- The House rejected a bill that would have slashed spending and put restrictions on immigration and border security.
- The impending shutdown comes only four months after a similar impasse.
- McCarthy was successful in passing three of the four proposals he had introduced to fund four federal agencies.
It is almost inevitable that federal agencies will partially shut down starting Sunday as a result of the House of Representatives’ rejection of a measure put forth by House Speaker Kevin McCarthy to temporarily fund the government. To allow members more time to talk, the House rejected a bill that would have slashed spending and put restrictions on immigration and border security.
This measure was supported by the Republican Party but had no chance of passing the Democratic-majority Senate. A similar plan, known as a continuing resolution, or CR, to fund the government through November 17 has been advanced by the Senate on a largely bipartisan basis.
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A government shutdown, according to U.S. Treasury Secretary Janet Yellen, would “undermine” economic growth in the country by suspending crucial initiatives for kids’ welfare and small enterprises. It may also cause significant infrastructure upgrades to be put off.
The impending shutdown, which would be the fourth in a decade, comes only four months after a similar impasse that had the federal government on the verge of going into days-long default on its more than $31 trillion in debt. The nation’s creditworthiness may be harmed by the repeated brinksmanship, according to a warning from the ratings agency Moody’s on Wall Street.
Hardliners who reject the proposal would prefer that Congress move on with comprehensive spending legislation for fiscal 2024. Democrats cautioned that the Republican CR would result in budget reductions of 57% for fighting wildfires and 30% for programs for low-income women and children. Defense and homeland security budgets would be increased.
Late on Thursday, McCarthy was successful in passing three of the four proposals he had introduced to fund four federal agencies. The legislation, which was drafted to satisfy fervent conservative demands, has little chance of passing the Democratic-controlled Senate.
Hardline House Republicans are calling for more savings of $120 billion as well as stricter legislation to halt the flow of immigration at the Mexican border. A shutdown would postpone the release of crucial economic data, which might cause financial market volatility, as well as the announcement of retirees’ Social Security payout increases for the following year.
