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White House prepares for potential government shutdown


Treasury Secretary Janet Yellen, center, Speaker of the House Nancy Pelosi, D-Calif., and Senate Majority Leader Charles Schumer, D-N.Y., arrive for a news conference to announce a framework for President Bidens economic plan in the Capitol Visitor Center on Thursday, September 23, 2021.

Tom Williams | CQ-Roll Call, Inc. | Getty Images

Democrats in Congress scrambled Thursday to beat a string of deadlines that hold massive stakes for both the health of the U.S. economy and President Joe Biden’s sweeping economic agenda.

House Speaker Nancy Pelosi, D-Calif., and Senate Majority Leader Chuck Schumer, D-N.Y., aim to work their way out of multiple binds as they try to prevent a government shutdown, a default on U.S. debt and the collapse of Biden’s domestic ambitions.

They are first faced with the Sept. 30 deadline to pass an Appropriations Bill before funding for government lapses. On Thursday, the White House advised federal agencies that they should prepare for the Covid-19-era’s first shutdown.

White House Office of Management and Budget will be making efforts to notify department and agency officials that, barring any new appropriations bills, shutdown plans are likely to take place by next week. Many agency plans include sending employees home.

The office usually requests agencies to review their plans 7 days before the shutdown. It will then share a draft template with departments to allow them to provide updates to government workers on Congress’ efforts to pass funding bills and what number of furloughed employees they may require.

Although the communication doesn’t reflect any views of the office on whether a continuation is likely, it is more of an official duty.

Capitol Hill is attempting to approve a new budget. House Democrats passed earlier this week a bill to fund government, stop the debt ceiling and authorize emergency relief such as disaster aid.

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That proposal is expected to stall in the Senate, where Republicans are unanimous in their opposition to any bill that seeks to raise or suspend the debt ceiling. 

Democrats have tight deadlines. Pelosi has promised to vote on an $1 trillion infrastructure bill before September 27th. It has been passed by the Senate.

There are still other deadlines. To avoid a shutdown Congress will need to pass a budget before September ends. However, legislators must find a way for Congress to raise or suspend the debt ceiling at a “drop-dead date”.

Officials from Treasury estimate that Congress has until October to approve a budget. If the deadline is not met, the U.S. will default on its debt for a first time.

Schumer promised that he would take up the House debt ceiling bill and the funding bill for government. He also said that he will force Republicans to vote against the bill. The bill would allow Congress to fund legislation it has approved and keep the government open.

Although raising the debt ceiling or borrowing limit does not authorize federal spending increases, it allows Treasury to reimburse for bills that have been passed by Congress. The department would be able to pay bills related to the billions of dollars in Covid relief that was enacted by former President Donald Trump or Vice-President Joe Biden.

Pelosi is likely to be required to approve a new resolution that does not include the debt ceiling in order to maintain the government’s openness. Senate Minority leader Mitch McConnell from Kentucky has repeatedly stated that he will support such a bill in order to avoid a shutdown.

Pelosi, Schumer announced that they have reached an agreement regarding the “framework for taxes” required to pay the Democrats’ $3.5 billion package to transform the U.S. safety net.

Schumer stated that the White House, Senate and House have agreed on a framework to pay for any final agreement. We have reached an agreement regarding the revenue aspect of this. It is a framework. The framework has been agreed to.

Both moderate and progressive Democrats disagree over the scope and size of the framework. Schumer and Pelosi did not clarify whether negotiators made financial decisions to narrow down the options or were just in agreement about which option they would consider.