Congress aims to pass funding bill
On Wednesday, October 6, 2021, the U.S. Capitol was opened in Washington, D.C.
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Wall Street and Washington expressed optimism Monday about the possibility that Congress would pass legislation to fund government and avoid a partial shutdown by Friday.
Uncertain how long the lawmakers would keep trying to run the government was what it meant. Democrats are preparing a list to prioritize their priorities as they attempt to prevent a shutdown and pass legislation. $1.75 trillion Build Back Better billApprove a new bill to fund the defense and increase the debt limit.
CNBC’s Monday interview with Washington policy experts and congressional staff expressed optimism over the prospects of Congress passing a temporary spending bill, also known as a continued resolution. If legislation is not passed before Friday, furloughs could be triggered for federal workers as well as a suspension of certain federal services.
According to CNBC, Democrats and Republicans were apparently coming together around a bill which would finance the government until late January or early Februar, according to a source familiar with the talks. According to another source, the chief negotiators feel confident that they can come up with a compromise and avoid a government shutdown.
These people requested not to be identified in order to talk openly about private and ongoing talks between the party leaders.
Wall Street also shared this optimism.
“The good news? Both sides are keen to avoid government shutdown, and Republicans don’t seem willing to put up a filibuster which could delay a spending bill. In an email, Tom Block, Washington policy strategist from Fundstrat Global Advisors wrote that Friday’s open question must be addressed.
He said that Democrats would like to increase government funding for a few weeks in order to get Congress to make significant spending changes during the current fiscal year. It would secure spending at the current level if lawmakers passed a continued resolution that lasted longer.
However lawmakers decide to proceed, Senate Majority Leader Chuck SchumerD-N.Y. will have to persuade the Senate Minority leader Mitch McConnellR-Ky. will pass a continuing solution by the end the week. The short-term funding bill is not likely to face opposition from the Senate Republicans, just as they are about to enter recess for the year.
Schumer’s Office declined to comment. McConnell representatives said that negotiations were ongoing.
House Speaker’s spokesperson Nancy PelosiD-Calif. did not respond to our request for comment. Monday’s report from Punchbowl NewsThe Democrats in the chamber could propose a bill to fund a temporary funding gap Tuesday, and then vote on Wednesday.
Despite the fact that the government was shut down twice by former President Donald Trump’s administration, Republicans as well as Democrats generally agree that Congress must continue to run the federal government.
Both parties are often divided on additions to “clean” funding bills. These generally don’t include related provisions. In September, Democrats attempted to connect government funding legislation with a higher debt limit.
Shutdowns can often force the Departments of Housing and Urban Development, Education, Interior, Labor, and Commerce to let most of their employees go home until Congress approves another funding bill.
Negotiations for government funding differ from more strenuous debates over how to raise or suspend the U.S. national debt limit. Treasury Secretary Janet YellenThe government has warned legislators that it could run out of money to pay its bills by Dec. 15th.
The U.S. will default for the first-time if the Treasury Department fails to make its regular debt payments. Yellen warned that a default is possible, although it seems unlikely. would lead to a recessionIt could also lead to a rise in interest rates. This could undermine the U.S. Dollar’s status as the world’s reserve currency.
Recent months saw bitter fighting between Republicans and Democrats over attempts to raise the debt ceiling.
Republicans are refusing to vote for the increase. The Republicans argued that Democrats should lift the limit since they hold Congress and have taken control of their $1.75 trillion package, which would include education, climate and health policy.
Democrats point out that increasing the debt limit does not allow for additional expenditure of taxpayer money. Yellen explained in September thatEven though the Biden Administration had not approved any spending by the end of the Biden presidency, Congress would have to raise the borrowing limit.
The debt limit was suspended three times by Congress during Trump’s administration.
NBC News reported that McConnell had met Schumer earlier in the month to discuss legislation for year-end, which included the debt limit. McConnell said that McConnell and Schumer had “a great discussion about many different topics” and they were happy to continue “talking and working together.”