Govt Shutdown Delayed- So Congressmen Can Campaign

[da_juice]

http://www.bbc.co.uk/news/world-us-canada-19687090

US Congress passed deal to avert shutdown and begin campaign

Bickering between the two parties has often brought the government close to a shutdown
Democrats and Republicans in the US Congress have agreed a compromise spending bill to avoid a government shutdown.

The 62-30 vote averts the possibility of US federal agencies shutting down because of a lack of guaranteed funding on 1 October.

The package must now be signed by President Barack Obama.

Saturday's vote allowed lawmakers to return to their home states to campaign for the 6 November election.

The $524bn package (£323bn) slightly raises the amount of money which funds government agencies - from defence to national parks.

The stop-gap measure was needed amid disagreements between Democrats and Republicans - and it ensures funding until March next year.

"It is an inefficient way to fund the federal government but it is better than shutting it down next week," said Democratic Senator Daniel Inouye.

Last year, a similar impasse was averted a similar threat for the third time in a year.

The issue became more polarised in the run-up to the presidential elections pitting Mr Obama - seeking a second term - against former Massachusetts Governor Mitt Romney.

I don't understand much about budgeting- does mean the fiscal cliff is also delayed until March? Or is this totally different? Either way, you gotta love this country. Threaten to bring down the economy and nobody cares. If something threatens to hurt re-election chances, then all of the sudden everyone's willing to work together.

[Major]

Originally Posted by da_juice I don't understand much about budgeting- does mean the fiscal cliff is also delayed until March? Or is this totally different?

No - this is totally different. The fiscal cliff is:

1. The sequester process which will slash spending on Jan 1 barring alternative legislation (this is from the debt ceiling debate)

2. Bush tax cuts expiring, which will raise taxes on everyone Jan 1 barring alternative legislation (this is from 2001/2003, and extended in 2010 lame duck session)

We also will have another debt ceiling debate early next year, most likely.

But yes, your overall point about how our government run is correct. One proposed solution to #2 is letting all the tax cuts expire, and then passing new tax cuts early next year for everyone except the rich. This would allow Republicans to maintain their stupid pledge to Grover Norquist to never vote to raise taxes.

[Joe Joe]

Originally Posted by Major But yes, your overall point about how our government run is correct. One proposed solution to #2 is letting all the tax cuts expire, and then passing new tax cuts early next year for everyone except the rich. This would allow Republicans to maintain their stupid pledge to Grover Norquist to never vote to raise taxes.

Why not just let tax cuts expire for everyone, besides those that can't afford taxes. Getting capital gains taxes back up would help.

[Major]

Originally Posted by Joe Joe Why not just let tax cuts expire for everyone, besides those that can't afford taxes. Getting capital gains taxes back up would help.

I totally agree - I think going back to Clinton era tax cuts would be a great thing for the country's fiscal health in the long-run. It's politically unpalatable, unfortunately, and our government doesn't like to make hard decisions for the most part. And I think there's concern about doing so in the midst of a weak job recovery - in that regard, I would think phasing them back in would be a way to go - pass a bill that raises taxes by 0.5% per year or something like that for each of the next 5-10 years or however long it takes to get back there for the various tax brackets.

[da_juice]

Originally Posted by Major No - this is totally different. The fiscal cliff is: 1. The sequester process which will slash spending on Jan 1 barring alternative legislation (this is from the debt ceiling debate) 2. Bush tax cuts expiring, which will raise taxes on everyone Jan 1 barring alternative legislation (this is from 2001/2003, and extended in 2010 lame duck session) We also will have another debt ceiling debate early next year, most likely. But yes, your overall point about how our government run is correct. One proposed solution to #2 is letting all the tax cuts expire, and then passing new tax cuts early next year for everyone except the rich. This would allow Republicans to maintain their stupid pledge to Grover Norquist to never vote to raise taxes.

They say that we'll have a double dip worse than the 1st recession if we go off the cliff. Would it be naive to assume that we could reach a deal preventing that without the president and congress being the same party?

[Major]

Originally Posted by da_juice They say that we'll have a double dip worse than the 1st recession if we go off the cliff. Would it be naive to assume that we could reach a deal preventing that without the president and congress being the same party?

The recession argument is probably true - you're talking about a pretty significant shock to a system that is already not very healthy. I'm pretty certain they will resolve the fiscal cliff in the lame duck session - but they will probably take until the very last second and create all sorts of unnecessary panic in the interim. How it's resolved will likely be determined in large part on how the elections go. Whichever party does well is going to get a lot of political leverage for their position on the issues.