House Republican hardliners’ efforts to stonewall a budget deal ahead of a looming government shutdown could risk triggering automatic spending cuts later this spring that may put pressure on the U.S. economy’s already fraught recovery.
The first funding deadline is Friday at midnight when several government agencies including agriculture, veterans affairs and transportation, are due to run out of money. The second is next Friday, March 8, after which a full government shutdown would take effect if there is no funding resolution.
President Joe Biden has a meeting Tuesday morning about the budget impasse with House Speaker Mike Johnson, R-La., Senate Majority Leader Chuck Schumer, D-N.Y., Senate Minority Leader Mitch McConnell and House Minority Leader Hakeem Jeffries, D-N.Y.
The Fiscal Responsibility Act, enacted in June of last year, mandated that if a permanent government budget was not in place by Jan. 1 of this year, then spending would automatically be cut by $4 billion on April 30, according to a Congressional Research Service analysis.
In addition to the topline number, there would a mandatory shift in the share of funding allocated to defense and non-defense purposes. This would have the effect of automatically adding $33 billion to the non-defense spending column, and slicing $37 billion from the defense budget.
The government has been running solely on temporary spending bills since its fiscal year began in October, putting the FRA’s spending cut mandate in play.
The looming FRA cuts raise the stakes for the coming round of funding expiration dates.
Capitol Hill is facing yet another week of government shutdown déjà vu. A full-year budget deal to avert the FRA cuts appears increasingly unlikely, amid staunch opposition from the House’s ultraconservative wing.
Freedom Caucus derailment
Members of the House Freedom Caucus, a coalition of hardline conservatives, have been working to derail a permanent budget. Instead, they want to extend the current temporary…
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