As of: 09/28/2021 8:11 a.m.
Because the Republicans are blocking a budget vote, the USA is threatened with a new “shutdown” – and with it massive restrictions in public life. In addition, the US Congress is fighting for two gigantic investment packages.
The USA is once again threatened with a partial standstill in government business. The Republicans blocked a bill in the US Senate on Monday evening to secure government funding beyond the end of the fiscal year.
The new financial year starts on October 1st, this Friday. If no budget regulation has been decided by then, parts of the government will “shut down”. Hundreds of thousands of federal employees would then be sent on unpaid compulsory leave, and numerous public institutions would have to close.
The Democrats had already presented a transitional budget, but linked it to a suspension of the debt ceiling. This met with resistance from the Republicans, which is why they refused to approve the project in the Senate.
Government threatens insolvency
Without an increase in the debt ceiling by Congress, the US government faces another default in October, according to Treasury Secretary Janet Yellen. It is not possible to give an exact day, but the government will run out of money “during the month of October”, Yellen last warned.
The leading Democrats in the Senate and House of Representatives, Chuck Schumer and Nancy Pelosi, accused the Republicans of blocking their blockade as utterly irresponsible. Schumer announced “further steps” for the week to raise the debt ceiling.
In addition, Biden is currently fighting to push through two central projects of his term in office in Congress: a large-scale package for investments in the country’s infrastructure and a second package for social investments.
Government is fighting for reform packages
The Senate voted in early August for a $ 1.2 trillion infrastructure package that includes massive investments in roads, bridges, train lines, broadband internet, water pipes and climate change measures. In addition to Biden’s Democrats, some Republicans also voted for the project.
Now it has to pass through the House of Representatives – but there is resistance in the progressive wing of Biden’s Democrats. Left-wing MPs only want to vote for the infrastructure package if the social package makes progress at the same time. They fear that it could peter out in the Senate once the infrastructure package has been approved and they no longer have any leverage.
The social package is the heart of Biden’s reform plans and would be the largest expansion of the welfare state in the USA in decades. It provides $ 3.5 trillion for education, health care, families, and climate protection over a ten-year period.
Decisions expected this week
The measures are to be financed through higher taxes for companies and the rich. The opposition Republicans firmly reject the plans. However, Democratic senators also have reservations, especially the center politicians Joe Manchin and Kyrsten Sinema.
Because the Democrats in the Senate only have a wafer-thin majority, they cannot afford a single deviator – otherwise the social program will fail. Decisions on the two packages are expected this week.