An Explainer of the Upcoming Government Funding Battle

The U.S. Capitol building in Washington on Aug. 18, 2023. Madalina Vasiliu/The Epoch Times

As Congress returns from the August recess, funding the government is lawmakers’ top priority.

But that’s set to be a challenge for Speaker of the House Kevin McCarthy (R-Calif.), who needs to wrangle an ideologically-divided caucus while balancing negotiations with the Democrat-controlled Senate and White House to pass the series of bills required to fund the government.

Every year, Congress must pass 12 spending bills to fund various programs and sectors of government.

Failure to pass these bills initiates a full or partial government shutdown—a situation under which only the most essential federal employees remain at work. Nonessential employees in unfunded government sectors are furloughed indefinitely without pay until their sector is again funded by Congress.

The last government shutdown—the longest in history—began in December 2018 at the end of the 115th Congress and lasted 34 days, by which point the 116th Congress had taken its seats amid a confrontation between President Donald Trump and Democrats over funding for a border wall. President Trump ultimately agreed to reopen the government despite not getting his way on the issue.

Over the past four and a half years, the country has avoided another government shutdown, in part due to Democrats’ consolidated control of the Capitol and White House.

But now, with power in Washington again split, this time between a Republican House and a Democrat Senate, the threat of government shutdown is again on the table.

Though a codified May 30 deadline exists for committees to submit rough drafts of their proposed appropriation packages, this is a deadline Congress has not met in over a decade. Instead, lawmakers have traditionally scrambled to overcome spending challenges in September after the month-long August recess.

House Republicans Cut Out of Prior Bill

During the lame duck session of the last Congress, much to the chagrin of the incoming Republican House, Senate Minority Leader Mitch McConnell (R-Ky.) negotiated and passed a 5,000 page, $1.7 trillion omnibus spending bill with the outgoing Democrat majority to fund the government for fiscal year 2023.

That measure included $858 billion in defense spending, a nearly 10 percent increase over the previous year that gained Republican support, plus $787 billion in nondefense spending, marking a nearly 8 percent boost. Also in the proposal was about $85 billion in supplemental funding for Ukraine and for disaster relief.

At the time, Republicans in both the House and Senate called on Mr. McConnell to pass a continuing resolution, a bill which allows the government to remain open at previously approved funding levels, in order to give House Republicans in the incoming 118th Congress a say in spending.

Rep. Chip Roy (R-Texas) at the time condemned the package as “a lame duck spending blowout.”

But despite a chorus of criticism, Mr. McConnell opted against allowing his own party to negotiate spending levels, instead forming the $1.7 trillion agreement with Democrats, almost certainly saving Democrats from having to negotiate a bill that met the wide-ranging spending cuts now demanded by Republicans.

Due to Mr. McConnell’s spending bill, Republicans in the 118th House of Representatives have had minimal say in crafting spending thresholds for the federal government during this term of Congress.

Debt Ceiling Battle

Nevertheless, Republicans have already been able to force some fiscal concessions from Democrats during their nine months in power.

Earlier this year in May, Republicans capped off a weeks-long standoff with Democrats over the debt ceiling, or the maximum amount the U.S. Treasury can legally borrow. Failure to raise the debt ceiling would have resulted in a default, an outcome which would have decimated the value of the U.S. dollar.

The product of those negotiations was the Fiscal Responsibility Act, a package that gave concessions to both parties, with neither fully satisfied.

That bill suspended the debt limit through January 2025, essentially meaning there are no congressional limits on how much money the Treasury can borrow until then. This was a clear win for President Joe Biden, as it meant he won’t face down another debt ceiling battle during the 118th Congress.

On the other hand, the bill instituted some spending cuts and caps. Mr. McCarthy marketed these aspects as a clear win for Republicans, trumpeting the cuts included in the bill as the largest spending cuts in U.S. history.

Additionally, the bill mandated a 1 percent cut in federal nondefense discretionary spending if a new spending agreement is not passed by the end of September, when current government funding runs out—a measure that ensured at least marginal spending cuts in nondefense spending, a key GOP target, moving forward.

Tension in the Republican Caucus

Nevertheless, many Republicans were sour about the deal, feeling that it didn’t go far enough to cut spending on social services and federal entitlement programs.

Of these Republicans, many of whom are in the House Freedom Caucus, several see the upcoming spending battle as a means to make more concrete gains toward their goal of balancing the budget, slashing government spending, and reducing the deficit.

Of the spending proposals released in the House and Senate, several have significant top-line price differences.

For instance, the Senate Appropriations Committee tentatively approved a bill for funding the Departments of Labor, Health and Human Services, and Education with a top-line price of $224.4 billion—which already represents a 7 percent cut over previous levels.

But House Republicans have requested a much more substantial cut, proposing a slash in the budget of the three agencies to $147 billion.

Still, any House-passed spending bill will also need to pass muster with the Democrat-controlled Senate and President Biden’s White House—both of which are unlikely to approve the most wide-ranging items requested by right-wing House members.

At the same time, Mr. McCarthy’s speakership has since the beginning rested on thin ice within his caucus. In order to gain the speakership, Mr. McCarthy was required to accept significant cuts to his power—including allowing a single member of the House to bring a motion to vacate the speakership to the floor, which could lead to another battle for the speaker’s gavel.

The threat that members of his own party will bring such a motion against him hangs over Mr. McCarthy’s upcoming efforts to negotiate spending packages.

Controversial Bills

So far, only one of the 12 spending bills, the Military Construction and Veteran’s Affairs funding bill, is on track for congressional approval.

Other important funding bills, including a House-version of a defense appropriations bill which tackles controversial cultural issues, remain highly disputed.

The bill funding the Department of Justice and FBI, two top targets of Republican scrutiny, also has yet to move forward as some members have called for substantial cuts to the budgets of both bodies.

An additional bill funding the Department of Homeland Security (DHS), which manages the southern border, is also up for consideration even as Republicans in the House hurtle toward impeachment proceedings against DHS Secretary Alejandro Mayorkas, who Republicans say has failed to secure the border amid an unprecedented influx of illegal immigrants.

Funding is set to expire on Sept. 30, and the government will go into a partial shutdown—a shutdown of all unfunded government sectors—at midnight on Oct. 1 if no deal is reached, meaning a frantic month of bicameral negotiations is ahead for lawmakers throughout the coming weeks.

Mr. McCarthy could authorize the passage of a continuing resolution to keep the government open as negotiations on these and other bills continue. However, he may be hesitant to advance such a move due to the ideological splits within his caucus and the threat of a motion to vacate.

Mark Tapscott contributed to this report.