Government funding expires Friday midnight. Congressional negotiators are vying to file bipartisan legislation to extend current spending through March, replenish exhausted disaster assistance accounts and hang several ornaments (such as revival of the expired Farm Bill) on the Christmas tree spending bill. The House passed a somewhat bipartisan Defense authorization last week while Senators confirmed five nominees. The Senate will approve the Defense authorization this week while awaiting House action on the spending proposal. If all goes according to plan, Congress will adjourn for 2024 at the end of the week.
When the 119th Congress convenes January 3, Republicans will try to pass a partisan budget resolution (budget resolutions are always partisan) authorizing multiple reconciliation plans and confirm cabinet nominees beginning January 20.
Some of the confirmations are controversial and President-elect Donald Trump’s allies are adopting a new, confrontational approach to threaten Republican Senators who express misgivings about any nominee’s qualifications or judgement. The effort to pressure Senators into submission could cost President Trump support later this year when he needs friendly relationships to pass reconciliation measures and make his final term a legislative success:
It seems likely the 119th Congress will pursue 2 or 3 reconciliation bills, the first dealing with spending for border security, immigration, the Pentagon, and energy A second would probably increase the debt ceiling that will be reinstated on January 1. The third would renew expiring 2017 tax provisions and exempt tip, overtime and Social Security income. The fiscal cost could explode the deficit, probably unnerving fiscal hawks and the bond market.
The Federal Reserve meets this week and is expected to cut interest rates 0.25 percent. Stubborn inflation above their 2 percent target and the incoming Trump Administration’s fiscal stimulus could encourage the Federal Reserve to slow or stop additional interest rate cuts in 2025.
