U.S. Congress Averts Government Shutdown with Stopgap Bill

By Richard Cowan and Moira Warburton

WASHINGTON (Reuters) – The U.S. Congress passed a stopgap bill on Wednesday to avert a partial government shutdown beginning next week, despite a significant number of House Republicans revolting against their leadership for not securing new federal spending cuts.

The Democratic-majority Senate passed the bill by a margin of 78-18, shortly after the House of Representatives approved it. This measure will maintain the current government funding level of approximately $1.2 trillion in annual discretionary spending through Dec. 20, avoiding the furloughing of thousands of federal workers and the shutdown of numerous government services just weeks before the Nov. 5 election.

Republican House Speaker Mike Johnson was compelled to employ a parliamentary maneuver to bypass the House Rules Committee due to the internal opposition within his own party, which holds a narrow 220-212 majority. The measure ultimately passed the House 341-82, with all dissenting votes coming from Republicans.

The bill now awaits President Joe Biden’s signature before the existing funding expires at midnight on Monday. Congress moved unusually swiftly to pass the bill as members aimed to return to campaigning in their districts before the upcoming election.

A considerable number of House Republicans opposed their leadership and voted against the measure after Republican presidential candidate Donald Trump advocated for a shutdown unless contentious legislation was included to prohibit non-citizens from voting in federal elections, an act that is already illegal.

Hard-right House Republicans had been pushing for a six-month stopgap measure that included election-related provisions but failed to pass that bill last week, which would likely have been rejected in the Senate regardless.

Nevertheless, some of the most conservative Republicans believed Johnson and all rank-and-file Republicans should have fought more against a Democratic win, even if it resulted in a shutdown.

This week, Moody’s (NYSE:MCO) credit ratings agency indicated that it expects the politically polarized environment in the U.S. to deteriorate the federal government’s fiscal health. As of November 2024, it is the last major rating agency that has maintained a top rating for the U.S. government, though it has lowered its credit outlook to ‘negative.’

Speaker Johnson has frequently needed to bypass his restive caucus to pass vital legislation. In March, the House approved the current funding bill despite 112 Republicans voting against it. In April, nearly $61 billion in new aid for Ukraine was passed amidst opposition from 112 Republicans against Johnson’s initiative.

Johnson’s predecessor, then-Speaker Kevin McCarthy, was ousted by hard-line Republicans in an unprecedented vote, as they retaliated against him for reaching a bipartisan spending and debt ceiling agreement with Biden.

This conflict will return later this year when Democrats and Republicans must negotiate full-year government funding, facing a critical self-imposed deadline of Jan. 1 to either raise the national debt ceiling or risk defaulting on over $35 trillion in federal government debt.