ROUNDUP: Showdown im US-Kongress

WASHINGTON (dpa-AFX) – The US Congress wanted to avert an impending partial standstill of government business in the last few minutes. On Thursday, the Senate should first vote on transitional funding for the government until the beginning of December, as the Congress Chamber announced on Wednesday evening (local time). A vote in the House of Representatives was planned shortly afterwards, in order to finally put the budget regulation into effect shortly before the end of a crucial deadline at midnight.

In the House of Representatives there was also a vote on a US President on Thursday Joe Biden planned large infrastructure package initiated. However, until the end it was unclear whether this would happen. The background to this is a difficult internal struggle among the Democrats for a second, even larger investment package that Biden has pushed. For the Democrat, the packages are central to his presidency, his legacy, so to speak. “If it doesn’t happen today, it will happen anyway,” said Energy Secretary Jennifer Granholm on Thursday of the vote.

The new fiscal year in the US begins this Friday. If no budgetary regulation has been adopted by then, parts of the government would “shut down”. This means that some state employees would have to be given compulsory leave or work temporarily without pay. Such “shutdowns” occur more often in the USA. But Biden absolutely wants to prevent this from happening to him.

The House of Representatives had already decided last week with the votes of the Democrats on a regulation for the temporary financing of the government. In the Senate, however, the Republicans resisted because it also provided for the debt ceiling to be suspended for the time being – which they reject. In the end, the Democrats were forced to separate the two questions and can count on the approval of the Republicans in order to prevent a “shutdown.” According to Treasury Secretary Janet Yellen, if this limit is not raised or suspended by Congress, the US government is at risk of default in mid-October. “America would go bankrupt for the first time in history,” Yellen last warned. The result would likely be “a financial crisis and an economic recession”. The US economy and financial markets around the world are threatened with “irreparable damage.”

Pelosi and the Democratic majority leader in the Senate, Chuck Schumer, also warned of an economic catastrophe and accused the Republicans to risk dramatic damage with their blockage. Typically, raising or suspending the debt ceiling is a bipartisan matter.

The House of Representatives, with the votes of the Democrats, passed a separate bill on Wednesday evening to suspend the debt ceiling by December. The Senate would also have to agree to this, which is currently not very likely in view of the resistance of the Republicans. With an increasingly breathless series of talks and negotiations, he is trying 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 huge package for social investments.

The infrastructure package, with which roads, bridges and other transport and energy networks in the USA are to be modernized, passed the Senate in August after long negotiations – with the support of Republicans. The final vote of the other Congress Chamber is still missing. Around 550 billion US dollars of new investments in infrastructure are planned over the next few years. Overall, including previously budgeted funds, the package is worth more than a trillion dollars.

The second package provides for a significant expansion of social benefits. Biden wants, for example, to invest more in education and childcare, to give families more support and tax relief, and to take money into the fight against the climate crisis. So far, this package is worth $ 3.5 trillion, also spread over several years. It is to be financed by tax increases for top earners and the more consistent collection of due taxes.

Since the Republicans do not want to go along with this, the Democrats are planning to bring this second package through Congress on their own with a special parliamentary procedure . However, they only have narrow majorities in both chambers, and their plans are also controversial. Some moderate Democrats are critical of the high spending, while some progressive Democrats would have liked more. The latter threatened to block the infrastructure package unless the larger second package was also secured. Breathless negotiations have been going on for days to organize majorities for both. But they don’t seem in sight yet.

The moderate Democrat Joe Manchin complained about the 3.5 trillion package that it was “financial madness” to spend more trillions on social programs if not even the current programs could be funded. Progressive MP Alexandria Ocasio-Cortez, on the other hand, fears that the larger package could fall by the wayside if the smaller infrastructure package is passed on Thursday./jac/DP/jha

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