September 1, 2014

After Much Procrastination, Budget and Debt Deadlines Loom

  • The national debt has grown significantly in recent years due to rising annual deficits. A deficit occurs in any year the government spends more...

With a possible government shutdown less than a week away, Republicans and Democrats still seem to be on a collision course over the budget for Fiscal 2014. In addition, today Treasury Secretary Jack Lew warned congressional leaders that unless the federal debt limit is raised, the “extraordinary measures” that the government has been using to avoid default “will be exhausted no later than October 17.”

The Concord Coalition urges elected officials to work together to avoid a shutdown that will waste millions of tax dollars and create needless public anxiety over the government’s ability to function. Concord also continues to urge elected officials to avoid panicking global financial markets again with another round of brinksmanship over the unavoidable task of raising the debt limit.

The issues are so intertwined that elected officials should take a comprehensive approach to negotiations, with all parts of the budget on the table. Altering sequestration to ease pressure on discretionary spending, for example, would mean finding cuts in entitlement programs, which Republicans have sought. But this would lead Democrats to insist on new revenues as well. So far, Congress has had little success this year in trying to deal with these issues separately.

Late last week House Republicans passed a stop-gap measure that would extend government funding through Dec. 15 but it included a provision to cut funding for the Affordable Care Act (ACA). After delaying efforts by some Republicans, Senate Democrats are expected to remove the ACA provision before sending the legislation back to the House within the next few days.

Democrats have also been considering shortening the length of the stop-gap funding in hopes of prompting quicker action on sequestration cuts they oppose. Meanwhile, federal agencies are working on plans to keep essential government services running if a shut-down begins on Tuesday, the first day of the new fiscal year.