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Finally Over, Shutdown Showdown Tees Up New Battles

More fiscal fights are assured in the months ahead.

The debt-ceiling stalemate and 16-day government shutdown cost the economy billions, put tens of thousands out of work, made some little-known congressmen famous and tested the balance of power in Congress.

Yet as lawmakers ended the standoff with a hard-fought agreement, many pointed to a landscape left largely unchanged, with fiscal fights assured in the months ahead and long-standing political differences left unresolved.

“The battle is over,” said Rep. Austin Scott, R-Ga., a tea-party favorite who was president of the House GOP freshman class in 2011, “but the war has just begun.”

The agreement approved by both chambers late Wednesday night ended the government shutdown, and maintains government funding through Jan. 15. Federal agencies -- and the Congress -- reopened with employees expected back at work Thursday, according to the Office of Management and Budget. A provision for back pay is included.

The measure also extends the nation’s ability to borrow—which the administration said would be exhausted Thursday—through Feb. 7. The Treasury Department will be permitted to use extraordinary measures to borrow after that date, if it needs to, which could extend the deadline. There’s also a mechanism for Congress to vote in favor of a “motion to disapprove” any increase the president announces, but Obama can veto that and force an override effort.

The agreement paved the way for the House and Senate to conference on the budget, which Senate Democrats have been seeking for months. Headed by Senate Budget Committee Chairwoman Patty Murray, D-Wash., and House Budget Committee Chairman Paul Ryan, R-Wis., the committee will immediately begin debating large differences between Republicans and Democrats, starting with topline spending levels and whether those levels will include sequestration.

In fact, Murray, Ryan, Rep. Chris Van Hollen, D-Md., and Sen. Jeff Sessions, R-Ala., are scheduled to meet over breakfast Thursday to discuss the path forward. But many are pessimistic that the committee can resolve issues that have plagued Congress for years in time to report back for a mid-December deadline.

Van Hollen, the ranking Democrat on the House Budget Committee, was already laying down markers for Republicans on Wednesday. “They shouldn’t think they’re going to be able to use these new deadlines to make partisan demands,” he said.

Indeed, Democrats in both chambers emerge from the battle with some claim to the upper hand, with House Republicans, led by the conservative wing of the conference, having fallen short of their goals to waylay the Affordable Care Act, cut mandatory spending, and pursue other reforms.

The one Obamacare-related provision that made it into the agreement will require the Health and Human Services secretary to certify to Congress that proper income-verification procedures are in place before any subsidies are doled out to Americans who qualify for federal help buying insurance on the new exchanges. The HHS secretary will also be required to release a report on Jan. 1, the day the individual mandate to obtain insurance goes into effect, outlining how the health insurance marketplaces will verify that everyone who receives a subsidy qualifies. Finally, the HHS inspector general will be required to report on how well those verification procedures are working by July 1, 2014.

This is not a major change to the contentious 2010 health-reform law, although it will give Congress the opportunity for additional oversight as the reports are released—and perhaps additional fuel for Republican criticism.

In the Senate, Majority Leader Harry Reid held his Democrats together in a hardened defense against Republican demands, and was rewarded with a chance to negotiate from the high ground on the budget moving forward. “The unity was an important part of the ultimate outcome,” said Sen. Tim Kaine, D-Va.

There’s also no doubt that the standoff was tough on House Speaker John Boehner, whose management of the House majority was repeatedly called into question, but who ultimately won a standing ovation from his conference—and much praise from individual Republicans of all stripes—at a Wednesday meeting.

Indeed, many House Republicans refused to bow their heads, saying that the standoff was a learning experience that ultimately drew the conference together, even if the efforts resulted in what most experts are tallying as a loss.

“It’s pretty hard when he has a circle of 20 people that step up every day, and say, ‘Can we surrender today, Mr. Speaker?’ ” said Rep. Tim Huelskamp, R-Kan., who dismissed centrist Republicans as “the surrender caucus.”

He added: “All they do is whine about the battle, as if they thought being elected to Washington was going to be an easy job.”

But others said that the standoff, which was costly both in political and economic terms (the ratings agency Standard & Poor’s estimated on Wednesday that the shutdown took roughly $24 billion out of the economy), could impact the political climate moving forward.

Obama suggested Wednesday night that elected leaders “need to earn back the trust of the American people” and “get out of the habit of governing by crisis.”

Sen. Chuck Schumer, D-N.Y., also said there may have been lessons learned. As he put it, “Perhaps, moving forward, the politics of brinkmanship [and] of confrontation have reached their peak.”

Catherine Hollander and Ben Terris contributed to this article.

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