December 21st 2024.
On Saturday, President Joe Biden signed a bill into law that effectively avoided a government shutdown. This came after a chaotic few days, where Congress barely managed to approve a temporary funding plan just moments before the deadline. However, this plan did not meet President-elect Donald Trump's demands for addressing the country's debt, causing further upheaval.
The newly passed bill will maintain the government's current funding levels until March 14, while also allocating $100 billion in disaster aid and $10 billion for agricultural assistance to farmers. House Speaker Mike Johnson, R-La., had assured the public that they would "meet our obligations" and prevent a government shutdown. There was uncertainty surrounding the outcome, as Trump had insisted on an increase in the government's borrowing limit, threatening to initiate closures if his demands were not met.
Johnson's revised plan was eventually approved by a vote of 366-34 in the House and 85-11 in the Senate after midnight. By then, the White House had already called off all preparations for a shutdown. Senate Majority Leader Chuck Schumer, D-N.Y., declared confidently that there would be no government shutdown.
After the House vote, Johnson spoke with Trump, who was reportedly pleased with the outcome. Johnson himself described it as "a good outcome for the country" and acknowledged that the president-elect was also happy with the result. This was the third attempt by Johnson to fulfill one of the fundamental responsibilities of the federal government - keeping it open. However, the challenges he faced raised concerns about his ability to maintain his position as speaker, especially with dissatisfaction brewing among his Republican colleagues. Working alongside Trump and his ally Elon Musk, who was calling the shots from a distance, may prove to be a difficult task for Johnson.
The next speaker will be elected on Jan. 3, 2025, when the new Congress convenes. With a slim majority of 220-215, Republicans will have little room for error as they try to secure the speaker's gavel. One Republican representative, Andy Harris of Maryland, criticized the party for their deficit spending and expressed hesitancy towards supporting the GOP leadership. There are also indications of dissatisfaction among other members of the party.
Trump's last-minute demand for an increase in the debt limit was almost impossible to fulfill, leaving Johnson with very few options. He knew that he would not have enough support from the Republican majority alone, as many of them are deficit hawks who would not approve of further borrowing. This highlights the need for Republicans, who will have control of the White House, House, and Senate in the new year, to rely on Democratic votes for routine government operations.
With a national debt of approximately $36 trillion, the rise in inflation due to the pandemic has led to an increase in the government's borrowing costs. This has resulted in debt service surpassing national security spending for the upcoming year. The last time the debt limit was raised was in June 2023, but instead of setting a new limit, lawmakers suspended it until Jan. 1, 2025. At the moment, there is no urgency to raise the limit, as the Treasury Department can use "extraordinary measures" to prevent a default. However, these measures can only delay the deadline until the summer of 2025, which is something that Trump wanted to avoid during his presidency.
GOP leaders have stated that the debt limit will be addressed as part of tax and border packages in the new year. They have made a verbal agreement to raise the limit while cutting $2.5 trillion in spending over the next ten years. This is essentially the same deal that failed on Thursday night, with the only difference being Trump's demand for an increase in the debt limit. However, this new deal is much smaller than the original one that Johnson had negotiated with bipartisan leaders, which was rejected by Trump and Musk, forcing him to start over. This new bill includes a long list of other measures, including pay raises for lawmakers that have been heavily criticized. It also contains other bipartisan initiatives that may now face more obstacles in becoming law.
As Trump, who has not yet been inaugurated, continues to wield his influence in Congress from Mar-a-Lago, it is becoming evident that he has both power and limitations in his sway over the legislative branch. He is closely involved in orchestrating affairs alongside his ally Musk, who is leading the new Department of Government Efficiency. The Associated Press writers Kevin Freking, Stephen Groves, Mary Clare Jalonick, Darlene Superville, and Bill Barrow contributed to this report.
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