U.S. Republicans reject Senate bid to avoid government shutdown


* Conservatives still pushing for Obamacare delay

* House votes expected late on Saturday

By Thomas Ferraro and Caren Bohan

WASHINGTON, Sept 28 (Reuters) - The U.S. government edgedcloser on Saturday to a shutdown as Republicans in the House ofRepresentatives rejected an emergency spending bill approved bythe Senate and pushed instead for a one-year delay of PresidentBarack Obama's healthcare reform law.

In the latest round of high-stakes brinkmanship betweenDemocrats and Republicans, Republican leaders said after aclosed-door meeting, punctuated by loud cheering, that the Housewould vote later on Saturday on their latest plan to scuttle thehealthcare law, known as "Obamacare."

It would then return to the Senate. Democrats in the Senatehave already defeated one House proposal to derail Obamacare andSenate Majority Leader Harry Reid said they would do so again,calling the Republican move "pointless."

A Democratic aide said the Senate would "strip everythingout" of the House measure and "send them back a clean bill."

As of Saturday afternoon, the Senate was deciding on when tomeet, but the timing may leave only hours for it to act.

Neither side wants to be the last to cast the final votethat would lead to a shutdown, a concern that has turned thefunding measure into a hot potato being tossed between the twochambers until the last minute.

While polls consistently show the American public is tiredof political showdowns and opposed to a shutdown, Houseconservatives were jubilant about the fight ahead.

"This is a win-win all the way around," said ArizonaRepresentative Matt Salmon, who describe the mood of Republicansas "ecstatic."

Since the healthcare measure is attached to a must-pass billto continue funding the government when the fiscal year ends atmidnight on Monday, its failure would close down much of thegovernment for the first time since 1996.

For good measure, Republicans said they would also approve abill repealing a tax on medical devices that helps fund thehealthcare law.

In an effort to signal their seriousness about a shutdown,as well as cover themselves from political fallout, Republicanssaid they would separately approve a bill to ensure that membersof the U.S. military continue to be paid if government fundingis cut off.

In a government shutdown, spending for functions consideredessential, related to national security or public safety, wouldcontinue along with benefit programs such as Medicare healthinsurance and Social Security retirement benefits for seniors.

But hundreds of thousands of civilian federal employees-from people who process forms and handle regulatory proceedingsto workers at national parks and museums in Washington - wouldbe furloughed.

The healthcare law, set for launch on Tuesday, will provideinsurance coverage for millions of uninsured Americans throughexchanges.

Republicans object strongly to Obamacare, calling it amassive and unnecessary government intrusion into medicine thatwill damage the economy.

The last government shutdown ran from Dec. 16, 1995 to Jan.6, 1996 and was the product of a budget battle betweenDemocratic President Bill Clinton and Republicans, led bythen-Speaker of the House Newt Gingrich.

Republicans suffered a public backlash when votersre-elected Clinton in a landslide the following November, alesson never forgotten by senior Republicans, including HouseSpeaker John Boehner.

This time, Boehner tried to avoid a showdown but wasoverruled by his rebellious caucus, dominated since the 2010election by newcomers endorsed by the conservative Tea Partymovement.

With Boehner effectively sidelined, rank-and-fileRepublicans boasted of their unity. Members chanted "vote, vote,vote, vote," in their closed-door meeting, they reported later.

Afterward, Democratic Representative Louise Slaughter of NewYork, took to the House floor to accuse Republicans of throwinga "temper tantrum" about Obamacare under pressure from "TeaParty extremists."

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