US government shutdown could rattle fragile economy

(By Deutsche Welle) If the US House of Representatives fails to reach a compromise over budget cuts, the federal government will go unfunded and partially shutdown. A shutdown could shake global confidence in the fragile American economy.

Republicans and Democrats in the House of Representatives continued to lock horns over America’s budget deficit on Friday with a shutdown of the US government looming should the two sides prove unable to reach a compromise by midnight.

Republicans, buoyed by the fiscally conservative Tea Party movement, have called for drastic budget cuts over the next decade in order to reign in Washington’s ballooning debt. For the current fiscal year, Republicans are seeking some $40 billion (27 billion euros) in budget cuts.

Meanwhile, Democrats countered the Republican demand with $33 billion in reductions, arguing that deeper cuts could send America’s fragile economy into a tailspin just as it begins to work its way out of the worst crisis since the Great Depression in the 1930s.

President Obama met with Republican leader John Boehner and Democratic leader Harry Reid for emergency negotiations earlier this week. Although both sides of the political aisle said progress had been made toward compromise, a solution is outstanding.

“The only question is whether politics or ideology is going to get in the way of preventing a government shutdown,” Obama said in an unscheduled appearance in the White House press briefing room.

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Obama to give development a larger role in US foreign policy

(By Deutsche Welle) President Obama has declared development assistance vital to US national security interests. Some humanitarian organizations believe the president’s policy will end a growing trend toward the militarization of aid.

For the first time in American history, a US administration has issued a global development policy.

President Obama declared during his recent speech before the UN Millennium Goals Summit that development is not strictly an end in itself. Instead, it is a component of a wider national security strategy that defends US interests abroad.

“My national security strategy recognizes development not only as a moral imperative, but a strategic and economic imperative,” Obama said before the UN General Assembly.

In an era when the Defense Department is playing an increased role in development, some humanitarian organizations believe the President’s new policy will reverse the growing trend toward the militarization of aid.

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