Just hours before the deadline, Republicans and Democrats agreed on a compromise for the US budget to prevent a government shutdown. However, further steps are still necessary.
A few hours before an impending shutdown, the draft of an interim budget passed the US House of Representatives. The federal government's interim funding until March 14th must therefore pass the second chamber of Congress, the Senate, on Saturday night in order to prevent an administrative shutdown. President Joe Biden signaled his approval and thus his signature.
The new draft is very similar to an earlier proposal that was rejected in the House of Representatives after sharp criticism from President-elect Donald Trump and his advisor Elon Musk. Most of the elements that they had criticized were deleted.
Trump demands Debt ceiling
However, it did not include an abolition or years-long suspension of the debt ceiling as demanded by Trump. It was initially unclear what he thought of the new draft. The upper limit is formally suspended until January 1st, but the issue is unlikely to become acute until spring.
Trump wants to maintain tax cuts in his second term from January 20th, but avoid certain cuts. According to experts, new debt will probably be necessary for much of the money that will then be required. As president, Trump is threatened with a constant and protracted dispute over the cap in Congress, which he could avoid by repealing it or suspending it for years.
Shutdown still possible
If Congress does not agree on transition funding, parts of the federal administrative and governmental apparatus would be shut down from midnight on Saturday (local time), as was the case most recently in 2018 and 2019 during Trump's first term in office. Shortly before Christmas, this would have an impact on flight operations. The paychecks of more than two million federal employees would also be affected.
