Madison Kwiecinski 

News Editor

Mvk5945@psu.edu 

The budget for the National Government’s fiscal year  was set to run out if a new budget was not passed by September 30th, 2021. With only hours left to spare, President Joe Biden signed legislation late Thursday  in order to avoid a partial shutdown at least until December 3rd. Congress had passed the bill earlier the same day, which allowed for the extension on determining the federal budget. 

Avoiding the shutdown for now is an advertised crisis, but it is not the only budgetary crisis Congress is currently facing. Republicans and Democrats have been engaged in heated debate about how to best handle the U.S. being able to raise its borrowing cap, in order to avoid deferring on the national debt. 

The house approved the short-term funding measure by a 254-175 vote, and the Senate quickly passed it later that day in a 65-35 vote. The passage of this extension gives legislators more time to figure out how to best design the federal budget to fund agencies and the programs they offer. Many Republicans were against the extension, which was necessary in order to avoid the shutdown. 

“This is a good outcome, one I’m happy we are getting done,” said Congressman Chuck Schumer, the Senate Majority Leader. “With so many things to take care of in Washington, the last thing the American people need is for the government to grind to a halt.”

The short-term spending solution has funding set aside for a multitude of crisis going on domestically and abroad, with $6.3 billion set aside to help fund the resettlement of Afghanistan refugees, and about $28.6 billion in disaster relief funding, which will assist in situations like those suffering from Hurricane Ida and farmers who have lost crops due to drought and wildfires. 

On Monday September 27th, Republicans blocked a bill Democrats were attempting to pass that would continue funding the federal government at its current level for the next fiscal year, and suspend the debt ceiling. 

The controversy over raising the debt ceiling has been the largest problem the government has faced when passing a federal budget. At the current rate of spending, the National Government will run out of flexibility and surpass the federal debt ceiling on October 18th, 2021. To clarify, the debt ceiling is the legal national limit of what the Treasury Department is permitted to borrow. 

“There is only one viable option to deal with the debt limit: Congress needs to increase or suspend it, as it has done approximately 80 times, including three times during the last administration,” said Michael Gwinn, a White House spokesman. 

The funding issue and specifically the debt ceiling have become a highly partisan issue, with republicans insisting that this is an issue democrats need to deal with on their own, as it is them who wants to push forward their economically advantageous budget. 

“If to finance those spending and tax decisions, it’s necessary to issue additional debt,” Jannet Yellen, the U.S. Treasury Secretary said. “I believe it’s very disruptive to put the president and myself, the Treasury secretary, in a situation where we might be unable to pay the bills that result from those past decisions.”

The U.S. has never in history deferred on its national debt, and although they have been “shuffling around funds” to pay the bills since this issue arose at the end of August, they are running out of time. Dozens of social security payments, government loans, and more will be late if the budget and debt ceiling are not handled.

In addition, a government shutdown could be detrimental to the economy during this time of pandemic economic recovery, as it would place all non-essential government employees on leave temporarily without pay until the issue is handled.