Democrats in the House of Representatives reluctantly supported the bill from Republicans, who hold a slim majority of seats. The decision should give some time to reach agreement on a long-term federal budget. According to McCarthy, the interim budget should contain money for humanitarian aid and border security, but no budgetary component for Ukraine.
McCarthy previously called on Republicans and Democrats to resolve their “political differences” for the benefit of US citizens. For McCarthy, it is also about his own political survival. Right-wing hardliners among conservatives threatened to remove McCarthy from office. “If someone wants to dump me because I want to act like an adult, then they can try,” McCarthy said.
Senate endorsement questionable
However, it is more than questionable whether the project will be approved in the Senate. Democrats have the majority there. Furthermore, the time is very short. McCarthy’s new project could simply serve to blame the Democrats for the shutdown.
Getty Images/Bloomberg Creative The decision on whether to strike or not must be approved by the Chamber of Deputies and the Senate
The deadline for the budget approved by the US Congress at the end of last year ends on Sunday night (local time). At that time, a new federal budget or a transitional budget would have to be decided to avoid insolvency. A strike means that millions of public employees will no longer receive a salary. Many ministries and authorities have emergency plans for this eventuality. Thus, the majority of soldiers continue to work – but for now without pay. The severity of a shutdown’s impact on daily life and the U.S. economy depends on its duration.
Debt ceiling decoupled from the budget
In 1917, the debt ceiling was introduced in the US – it was originally a relief for the government, which previously had to obtain Congressional approval for each individual issue of government bonds. Budget creation and debt limits are legally separate processes. Expenses are regulated in different laws, in particular the Budget Law. The debt ceiling therefore does not directly limit the budget deficit, but rather the servicing of existing debts.
AP/Manuel Balce Ceneta Biden had already reached an agreement with McCarthy
Only when the spending cap set by Congress is reached does this debt ceiling go into effect – and the Treasury Department cannot issue new bonds to further enable government spending authorized by previous laws. For years, there has been a dispute among experts over whether the maximum limit is even constitutional.
Number 15 threat
Congress has shut down the work of the federal government 14 times since 1981, but usually only briefly. This time, none of this – hectic, late-night negotiations and warnings of consequences, including an international financial crisis – was supposed to happen. US President Joe Biden and McCarthy agreed in May on spending for the fiscal year that begins October 1. The tax year in the US always runs from October 1st of one year to September 30th of the following year.
However, the radical right-wing Republicans of the House Freedom Caucus reject this and demand – also with their radical clientele in mind – cuts of 120 billion US dollars (113 billion euros) on politically controversial issues. The sum itself seems comparatively small compared to a total budget of 6.4 billion US dollars (about six billion euros).
However, access to abortion will be made more difficult, climate measures will be reversed and construction of the wall with Mexico will resume – a central project of former Republican President Donald Trump, who wants to be re-elected next year.
Fine line between winner and loser status
In the USA, not only the President, but also the entire House of Representatives and a third of the Senate will be re-elected in November 2024. Politically, it is also about who is to blame for a shutdown. As a rule, those responsible for the strike will be punished in the elections. All Republican representatives who come from electoral districts with a narrow or variable majority have to fear for their re-election due to the stubbornness of the radical wing. The mood within the Republican faction is now correspondingly tense.
But McCarthy cannot ignore dissent, despite there being no partisanship in the US. Because the Republican majority in the House of Congress is extremely narrow, at 221 to 212 seats. McCarthy also finds himself in a dilemma for another reason: If he doesn’t take the Freedom Caucus into account, he will face impeachment. To be elected president of the House, McCarthy granted the radical faction a simplified impeachment procedure. A simple majority in the Chamber of Deputies is enough.