Just a few days remain for the US Congress to approve a fresh stopgap measure before funding expires on November 17. Despite a new compromise plan by Speaker Mike Johnson that excludes hardline conservative demands like cutting spending and restricting immigration, the US is still at risk of a government shutdown at the end of this week and because of this “US Faces Shutdown Of Risk Despite New Compromise Plan“.
A government shutdown would put the US credit rating at risk of being downgraded by Moody’s Investors Service, which has warned bond investors about the increased likelihood of political dysfunction. Both parties would suffer politically with a stoppage in government funding.
After Nov. 17, Congress will have just a few days to approve a new stopgap measure before funding expires. On Sunday, Johnson made the suggestion that his idea might afford Congress some time to work out the specific spending legislation that fiscal conservatives have been insisting upon.
“It will take time to overcome Washington’s addiction to spending,” he stated on the social media platform X. “But I will not allow end of year megabus spending packages to continue under my leadership” for US Faces Shutdown.
The White House, which is dissatisfied with the plan’s omission of Ukraine aid and the fact that it extends funding for some agencies through January 19 and others through February 2, may combine to oppose Johnson’s idea.
On Tuesday, the House will vote on the proposal. With conservatives’ hostility and his small majority, Johnson will require some Democratic votes.
Conservatives could obstruct the idea even before that stopgap vote, either on a procedural vote that sets up debate or before the matter reaches the floor.
US Faces Shutdown
“I can only be as courteous as disappointing. Conservative Ohioan Warren Davidson declared on X Saturday, “I will vote no.”
Although Democrats’ response to Johnson’s idea has been subdued, there were some early indications that it would get support from both parties.
Senator Chris Murphy of Connecticut stated on NBC’s Meet the Press, “I’m willing to listen, even though I don’t like what the House is talking about.”
But according to the White House, Johnson’s proposal will just cause more shutdowns in the future. Later on Monday, President Joe Biden might formally threaten to veto the bill.
But the bill lacks the strings that many Democrats had feared, and a veto threat could allow Republicans to blame the shutdown on the president.
Political Dysfunction
This year has seen the US almost go into default on its debt, caused Fitch Ratings to downgrade the country’s sovereign debt, and resulted in the resignation of Johnson’s predecessor. Speaker Kevin McCarthy was forced out of office by Republican hardliners after he presented a similar non-strings stopgap.
The US’s top credit rating agency, Moody’s, was the only one to downgrade the country’s rating on Friday. It did so due to political divisiveness in Congress and threats to the country’s fiscal stability. Because of this “US Faces Shutdown Of Risk Despite New Compromise Plan“.
A Bloomberg News/Morning Consult poll conducted from October 30 to November 7 revealed that Republicans’ standing in battleground states suffered as a result of the disorderly three-week process to choose a new speaker.
Swing-state voters who said the chaos surrounding the Speaker made them more likely to vote Democratic in 2024 over those who said the process made them more likely to vote Republican by a 9 percentage point margin. The Democratic lead among independents was seven points.
Just before Thanksgiving, a shutdown that starts on Saturday would cause government contracts and vendor payments to be delayed, resulting in the furlough of hundreds of thousands of federal employees. Until the deadlock is addressed, essential employees such as law enforcement officers, military people, and others would continue to work without receiving compensation.
The mounting potential of a financial market shutdown has not yet been taken seriously by investors, who are more concerned with high interest rates, bond market volatility, declining consumer spending, and the Middle East conflict.
US Government Faces Shutdown
A government shutdown would have an insignificant initial effect on the economy, but it would gradually worsen as millions of workers lose their pay, private contractors don’t get paid, and consumer concern rises. In its preliminary November reading, the University of Michigan Consumer Sentiment index fell to a six-month low.
According to Johnson’s proposal, the departments of Veterans Affairs, Energy, Agriculture, Transportation, and Housing and Urban Development would continue to receive financing through January 19; the remaining funds would be extended until February 2.
Republicans in the House of Representatives might take action as early as Monday night to stop Democrats from beginning work on their competing proposal else “US Faces Shutdown“.
New York senator and majority leader Chuck Schumer has scheduled a procedural vote for Monday afternoon to move placeholder legislation forward for short-term financing, probably through January.
Additionally, lawmakers from both parties have been debating how to proceed with the $106 billion in security funds that Biden requested for Taiwan, Israel, the US border, and Ukraine. Republican demands for asylum and other changes to immigration law have delayed the package.
Given the complex nature of the immigration issue, the likelihood of striking a settlement this week that includes the immediate security help is decreasing.
Johnson pleads for a break from his hardliners
Similar to the White House, Johnson’s language makes his plan clear. Speaking on a GOP conference call on Saturday, he stated, “I wasn’t the architect of the mess we are in.”
This strategy can be interpreted as a request to Republicans, who supported him despite their weariness and annoyance following weeks of conflict for the speakership, to allow him some time and leeway as he is still new to the position.
Johnson also serves as a warning to his soldiers about the potential disorder that might break out again if they leave him by bringing up his poisoned inheritance.
Johnson Speech
Johnson must navigate a challenging range of circumstances to bring his proposal to a vote on the floor this week.
There isn’t much time left before Friday’s deadline since the Senate is probably going to take a different tack and pass a clean extension bill, even if lawmakers from both parties don’t really like Johnson’s strategy.
On Sunday, Connecticut Democratic Senator Chris Murphy stated, “We are going to proceed in the Senate on a clean CR, without tricks, without ladders,” on NBC’s “Meet the Press.”
The fact that the House process calls for you to return and handle half of the budget on one date and the other half on a different date worries me.
That seems like a formula for disaster to me,” Murphy remarked. Murphy acknowledged that Johnson’s strategy was still a possibility and said he was prepared to “listen to the case that they’re making.”
However, it might already be too late to listen given how difficult it will be to outline government financing that even the most radical members of the GOP majority will accept. Once more, the US government is dangerously close to collapse.
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