It’s not Fall into Fall, it’s a Race over a Burning Tightrope

Hello, my favorite folks; it's that time.

The House returned to session, and Congress is firing back up at wheels again. On tap for this fall is the reconciliation bill. We talked about this before, but it is mainly the Biden economic agenda. It is an attempt to help transform our society by providing key investments in long-term programs over a ten-year period. It would represent an 8% increase in federal spending but providing things like universal child care, universal eldercare, more affordable healthcare, investments to fight climate change changing the tax code to be fairer. This big bill is all-consuming, and Washington is very focused on pushing to make this bill reach the finish line. This has been in the news all week, as the margins for making this happen are fragile. While this moves, DC has more work on its plate with a few additional big pieces of legislation that Washington has to deal with.

It's important to remember that the federal government has a fiscal year that ends on September 30. This means that all the funding passed last year technically ends on the 30th. New funding must be appropriated to continue funding the federal government. Now we have seen shutdowns before. And all makers will be trying their hardest to ensure that we do not see another shutdown this time. There must be a stopgap measure in place by at least September 30, or we risk a government shutdown. And we all remember that those are problematic for so many reasons and the harm they cost to communities when they happen. This will be a test of the Senate because they require 60 votes to make it through. It is believed that Nancy Pelosi can get all the votes into the House, and the House is started working on at least a continuing resolution next week. This means a piece of legislation that says we will fund the government at the levels that we funded it for the last fiscal year until a major bill is passed. But after moving through the House, it will have to have a much tougher path in the Senate. While likely, the Republicans will try to flex their muscles and demand cuts and retribution for things that they are unhappy with that don't necessarily be the ones to shutdown the government.

The next very large item that Washington will have to deal with this fall is the debt limit. Every year we spend money as a country, and we do a number if it was not financed or offset by revenues were taken. This results in deficit spending. And every so often, Congress must decide if they want to allow the country to spend more to make the difference between what we spend and what we take in. This debt is not all bad there are some things we think are worthy and can choose to spend for the good of our country. We also use that to finance and make relations with other countries in the financing of this debt.

On the off chance that the debt ceiling does get breached, this would be a massive issue. It causes major trouble for the financial market, which could trigger a global financial crisis. And but the republicans have said they would not be on board with raising the element. However, worrying about the debt ceiling and doing the work not to trigger benching it. During the last administration, the Democrats joined with Republicans to raise the debt ceiling. Now that the shoe is on the proverbial other foot, the Republicans had a different thought in mind. And are acting like they will not join to increase the debt limit for the country. Is it the height of hypocrisy, sure, but that's just how Washington rolls sometimes? However, this will require the Democrats to navigate tricky waters to ensure a deal can come together. Or make changes to the reconciliation bills to allow us to pass the deck ceiling increase along with a party-line vote in the Senate.

Next, we have everyone's favorite infrastructure. Yes, the bipartisan bill that the Senate passed in July has yet to be passed by the House. They're supposed to be a vote on it tentatively scheduled for September 27; however, that date might slip because Progressives in the House make up almost over a third of the House caucus said that they will not vote for the bill without a vote on the bigger reconciliation. This makes the timing of the next steps crucial, but once the House passes this bill, they make no substantive changes from the Senate. Or they can negotiate this quickly and send it back to the president for final passage.

Adding to the mix are emergency pools of money for disaster relief and for the settlement of Afghanistan refugees. Both of these situations will require additional support. The damage from the fires in California and the damage from hurricanes are two large items. Money has been requested for these items, and there is support to get this money out the door. These items will mean a lot of hard critical votes coming in the next few months for Congress. But floor time is precious, and the calendar is very tight.

What is this going to mean for you on the ground? First of all, given the delays they will not be any increased funding at any government program probably until December, but more likely not until next year. Furthermore, the money that gets unlocked in both the reconciliation and the president's budget will probably be delayed, meaning that those resources and new programs will probably not come online until the end of December or early January. In particular terms, programs like the child tax credit, which has cut rates of childhood poverty significantly down, might end at the end of the year.

It's going to be a wild fall ride, and we will buckle up and see what happens. Weigh in when things we know are being offered and make sure we understand what's happening in this crazy time.