Republicans in the US House of Representatives plan measures to avoid a shutdown amid a credit warning

Newly elected US House of Representatives Speaker Mike Johnson in Washington

Newly elected U.S. House Speaker Mike Johnson (R-Los Angeles) walks from his office to the Senate chamber at the U.S. Capitol in Washington, U.S., on October 26, 2023. REUTERS/Sarah Silbiger/File image obtained by license

WASHINGTON (Reuters) – U.S. House Republicans aim to pass a stopgap measure to avert a partial government shutdown on Saturday, the morning after Moody’s lowered its outlook on the government’s credit ratings to “negative.”

A knowledgeable source, who spoke on condition of anonymity, said plans to issue a continuing resolution, or CR, are still in flux. It was also not clear what form this action would take.

US House of Representatives Speaker Mike Johnson spent days in talks with members of his small Republican majority (221 votes to 212 votes) about several options for the Czech Republic. The Republican-controlled House and Democratic-led Senate must agree on a tool that President Joe Biden can sign into law before current funding expires on November 17.

Moody’s cited political polarization in Congress as a factor in its decision to lower credit expectations, saying Washington may not be able to reach an agreement to make its growing deficit affordable for everyone.

The United States ran a $1.7 trillion deficit last year – the largest outside the worst of the Covid-19 pandemic – and rising interest rates mean the cost of servicing that debt will continue to grow.

Just a few months ago, Congress pushed the United States to the brink of default on more than $31 trillion in debt, a move that would have shaken global financial markets.

With a potential shutdown just days away, some Republicans have called for a “clean” economic restructuring that will last until mid-January, without spending cuts or conservative political frontrunners opposed by Democrats.

But hardline conservatives continue to push for action through spending cuts, policies that include tighter security at the U.S.-Mexico border, and an unconventional structure with overlapping deadlines for different parts of the federal budget.

Many lawmakers warn that a prolonged partisan fight over the temporary measure could prevent Congress from avoiding a shutdown.

As House Republicans debated their options this week, Senate Majority Leader Chuck Schumer took an initial procedural step toward moving his own temporary measure.

David Morgan reports. Edited by Daniel Wallis and Grant McCall

Our Standards: The Thomson Reuters Trust Principles.

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(tags for translation)NRLPA:OPUB

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