Government Remains Funded, But What About The Budget and Infrastructure?

government news Oct 01, 2021

Thursday proved to be lively on capitol hill as lawmakers juggled three different challenges. President Biden signed a bill into law extending government funding through December 3rd, but the Infrastructure Bill and the Budget negotiations remain unsettled. Here are the details and what could transpire in the coming days.

Federal Government Remains Funded Through December 3rd

Thursday, President Biden signed H.R. 5305, the “Extending Government Funding and Delivering Emergency Assistance Act," which keeps the government funded through December 3, 2021. Government funding was set to expire at midnight, but the bill had bipartisan Congressional support and passed both chambers relatively quickly. This was the first challenge lawmakers had to tackle.

In addition to providing government funding for two more months, it also includes over $28 billion in emergency disaster aid and $6.3 billion for the resettlement of Afghan evacuees. Initially, Democrats tried to include a suspension of the debt ceiling until 2022, but it did not have Republican support, so it was removed from the bill.

Small Businesses May Benefit From the New Bill- H.R. 5305

H.R. 5305 contains promising language for small businesses. Under Title V, the bill apportions over $1 billion to the Small Business Administration. $620 million of that $1 billion "may be transferred to and merged with ‘‘Salaries and Expenses’’ for administrative expenses to carry out the disaster loan program authorized by section 7(b) of the Small Business Act."

This seems to suggest that the SBA will receive $620 million for "Salaries and Expenses" to help the Covid EIDL program. This could mean that the SBA will have more money to increase the number of staff working on EIDL applications, improve their processing, or a combination of both. This is welcomed news as tens of thousands of small businesses await their decision from the SBA.

House Delays Vote On Infrastructure Bill Until Friday

The House delayed a vote on the Infrastructure Bill for a second time this week, rescheduling it for Friday, October 1st. Democratic leaders and supporters of the bill state that this is a temporary setback. The vote was delayed to give lawmakers more time to negotiate on the $3.5 trillion budget plan.

Progressives in the Democrat party maintained their position today, that they would not vote on the Infrastructure Bill without the Senate passing the budget plan. Representative Pramila Jayapal, head of the Congressional Progressive Caucus, said “Nobody should be surprised that we are where we are, because we’ve been telling you that for three and a half months." President Biden and lawmakers have been in negotiations all week, trying to iron out their differences so both pieces can pass, but so far the differences have not been bridged.

The $3.5 trillion Budget Plan May Be Shrinking

Senator Joe Manchin has been clear on his position- he does not support spending anywhere near $3.5 trillion. Thursday, Manchin stated that he wants the budget amount cut down to $1.5 trillion, essentially reducing the current proposal by nearly 60%.

Progressive Democrats argue that the $3.5 trillion amount is already a large reduction from the $6 trillion that Senator Bernie Sanders originally proposed. Manchin maintains his position that the $3.5 trillion budget would be detrimental to the economy, but his proposed $1.5 trillion package is "basically what we could do and not jeopardize our economy.”

Manchin added that he is willing to get the priorities included in the $1.5 trillion amount and Progressives can run on the other items later. He said there are many ways Progressives could get what they are aiming for, "just not everything at one time." Negotiations are expected to continue Friday, especially as the House makes another attempt at passing the Infrastructure Bill, but discussions could continue for days or weeks.

Final Thoughts

The passage of H.R. 5305 is beneficial for everyone, as it keeps the government funded, prevents a government shutdown, and includes provisions that should hasten the EIDL process for small businesses. Negotiations over the budget and the Infrastructure Bill may continue for some time, as Democrats try to bridge the gap between the $1.5 trillion and $3.5 trillion proposals.

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