Shutdown and loan default loom as Congress stalls on $3.5 trillion infrastructure and budget bills
D emocrats and Republicans are in a standoff over raising the debt ceiling and passing a $3.5 trillion infrastructure bill, widening the path toward a government shutdown and an unprecedented default on the national debt.
The House passed a bill on Tuesday that would fund the government until December and suspend the debt limit until 2022, but GOP senators have been adamant that they will not support any bill that increases the debt. Republican Senate leadership said that it will block the 10 votes needed to bypass a filibuster on the bill.
If it doesn’t pass, the government will shut down on Oct. 1.
The only backup plan for the Democrats is to include the raised debt ceiling within the $3.5 trillion infrastructure deal championed by President Joe Biden. But Speaker of the House Nancy Pelosi signaled to colleagues in a letter on Monday that she will not move to vote on the bill in the House if her party cannot secure the votes of centrist Democrats in the Senate.
Sens. Kyrsten Sinema of Arizona and Joe Manchin of West Virginia have both publicly said they won’t vote for $3.5 trillion in spending but haven’t named a price they would support. House liberals, meanwhile, are pressuring for a vote regardless of Senate viability. A similar situation regarding a 2009 climate change bill that passed the House but never came to the Senate floor skewered centrist Democrats in their home districts, resulting in a lost bill and a lost majority in the following midterm elections.
Without a deal on the debt ceiling, which governs the money the Treasury Department can pay out, the department first relies on “extraordinary measures” for payments including Social Security.
These measures are expected to run dry in mid-October, after which the government would default on such payments and launch into uncharted fiscal waters.
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