Win some lose some: US Congress compromises to avert government shutdown

Congress is trying to avert one crisis while staving off another with the Senate poised to approve legislation that would fund the federal government into early December.

The House is expected to pass the measure after the Senate vote Thursday, preventing a partial government shutdown when the new budget year begins Friday.

Also read: Democrats, Republicans agree on government funding resolution: Sen. Schumer

Democrats were forced to remove a suspension of the federal government’s borrowing limit from the bill at the insistence of Republicans. If the debt limit isn’t raised by Oct. 18, the United States probably will face a financial crisis and economic recession, Treasury Secretary Janet Yellen said.

Republicans say Democrats have the votes to raise the debt limit on their own, and Republican leader Mitch McConnell of Kentucky is insisting they do so.

Also read: Can the US government avoid the shutdown on October 1?

But the most immediate priority facing Congress is to keep the government running once the current budget year ends at midnight Thursday. The bill’s expected approval will buy lawmakers more time to craft the spending bills that will fund federal agencies and the programs they administer.

Democrats, meanwhile, are struggling over how to get President Joe Biden‘s top domestic priorities over the finish line. There’s a bipartisan infrastructure bill that contains $550 billion in new spending for roads, bridges, broadband and other programs, as well as a $3.5 trillion package of social, health and environmental programs.

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“This is a good outcome, one I’m happy we are getting done,” Senate Majority Leader Chuck Schumer, D-N.Y., said before the vote. “With so many things to take care of in Washington, the last thing the American people need is for the government to grind to a halt.”

The short-term spending legislation will also provide about $28.6 billion in disaster relief for those recovering from Hurricane Ida and other natural disasters, and help support Afghanistan evacuees from the 20-year war between the U.S. and the Taliban.

Action in the final hours to avoid a partial government shutdown has become almost routine in recent years, with lawmakers usually able to fashion a compromise. The funding bill was slowed this time by disagreement over allowing the government to take on more debt so that it could continue to meet its financial obligations. Currently the borrowing cap is set at $28.4 trillion.

The U.S. has never defaulted on its debts in the modern era and historically, both parties have voted to raise the limit. Democrats joined the Republican Senate majority in doing so three times during Donald Trump’s presidency. This time Democrats wanted to take care of both priorities in one bill, but Senate Republicans blocked that effort Monday.

Also read: US House passes bill suspending debt ceiling as shutdown deadline looms

Raising or suspending the debt limit allows the federal government to pay obligations already incurred. It does not authorize new spending. McConnell has argued that Democrats should pass a debt limit extension with the same budgetary tools they are using to try to pass a $3.5 trillion effort to expand social safety net programs and tackle climate change. He reiterated that warning as the Senate opened on Thursday, even as Democrats have labeled that option a “nonstarter.”

“We’re able to fund the government today because the majority accepted reality. The same thing will need to happen on the debt limit next week,” McConnell said.

House Democrats pushed through a stand-alone bill late Wednesday that would suspend the debt limit until December 2022. Schumer said he would bring the measure to the Senate floor, but the bill is almost certain to be blocked by a Republican filibuster.

The arguments made in both chambers about the debt ceiling have followed similar themes.

“You are more interested in punishing Democrats than preserving our credit and that is something I’m having a real tough time getting my head around,” House Rules Committee Chairman Jim McGovern, D-Mass., told Republicans. “The idea of not paying bills just because we don’t like (Biden’s) policies is the wrong way to go.”

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Undaunted, Republicans argued that Democrats have chosen to ram through their political priorities on their own and thus are responsible for raising the debt limit on their own.

“So long as the Democratic majority continues to insist on spending money hand over fist, Republicans will refuse to help them lift the debt ceiling,” said Rep. Tom Cole, R-Okla.

The Treasury has taken steps to preserve cash, but once it runs out, it will be forced to rely on incoming revenue to pay its obligations. That would likely mean delays in payments to Social Security recipients, veterans and government workers, including military personnel. The Bipartisan Policy Center, a think tank, projects that the federal government would be unable to meet about 40% of payments due in the several weeks that follow.