By Caren Bohan
ORLANDO, Florida (Reuters) - Texas Senator Ted Cruz, who is leading a conservative push to eliminate funding for President Barack Obama's new healthcare law, took his fight on Saturday to a forum of Republican activists where he challenged lawmakers in his party not to "surrender" on Obamacare.
Cruz, a potential 2016 Republican presidential candidate, used a speech to an Americans for Prosperity conference in Orlando, Florida, to take to task those in his party who are wary of risking a possible government shutdown in an effort to fight Obama's signature healthcare law.
"Right now, the people who are fighting the hardest against our effort to defund Obamacare, sadly, are Republicans," Cruz told several hundred activists. "Well, you know what: you lose 100 percent of the fight if you surrender at the outset."
To loud applause, he added that Republicans should "stand up and win the argument."
Congress, which returns to Washington on September 9 after a summer break, faces two budget fights in quick succession.
Lawmakers must pass a spending bill by October 1 to avoid a government shutdown. By mid-October, they must pass an increase in the country's borrowing limit or risk a default on the debt.
Cruz is among a group of conservative lawmakers who want to use the first showdown - over a bill to keep the government funded - to try to block Obamacare.
But many congressional Republicans, including House of Representatives Speaker John Boehner and Senate Minority Leader Mitch McConnell, disagree with that approach even though they too oppose Obamacare.
Republicans, who control the House of Representatives, have repeatedly tried to repeal the 2010 healthcare law.
Implementation for a major part of the law will begin on October 1, when healthcare insurance marketplaces, known as exchanges, will be rolled out in the states.
Obama's Patient Protection and Affordable Care Act is expected to extend federally subsidized health coverage to an estimated 7 million uninsured Americans in 2014 through the marketplaces. Republicans contend the law will be a burden on businesses and cost jobs.
The two-day gathering in Orlando of Americans for Prosperity, a conservative group backed by billionaire brothers Charles and David Koch, was titled "Defending the American Dream."
Three other possible 2016 White House contenders addressed the forum on Friday: Florida Senator Marco Rubio, Louisiana Governor Bobby Jindal and Texas Governor Rick Perry.
Rubio also focused his speech on a call to eliminate funding for Obamacare. He got strong applause for that view but faced some heckling over his support for immigration reform, even though he did not raise that issue in his speech.
'RUN, TED, RUN'
Jindal and Perry got enthusiastic welcomes from the crowd but Cruz seemed to generate the most excitement, with the activists chanting, "Run, Ted, Run."
At the conference, Obamacare was a top issue and proved a contentious one for another Republican senator, Ron Johnson of Wisconsin, who led a session on federal spending.
Johnson, who won his seat in 2010 with the backing of the Tea Party, was heckled when he said using the spending measure to try to stop Obamacare would not work.
Even if Congress did not appropriate any new money for the health law, the program would continue because it is a so-called mandatory program in which benefits are not subject to annual appropriations, Johnson said.
"We've got to be smart and strategic in terms of something we can win on,' said Johnson, who called instead for trying to force a delay in the healthcare law.
One woman in the audience stood up and told Johnson to "have backbone" and 'be strong."
Mirroring divisions among Republicans in Congress, the room was divided on the issue, with some in the audience cheering on the woman and others showing support for Johnson.
"Oh, please," said one man, when the woman interrupted Johnson.
"I am fighting hard to repeal this thing," Johnson said, his voice rising. "Nobody in Congress wants to repeal Obamacare more than me."
(Corrects name in third paragraph)
(Reporting By Caren Bohan; Editing by Sandra Maler)
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