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Update on Shutdown & Debt Ceiling

Update on Shutdown & Debt Ceiling

Today marks the 11th day of Federal government shutdown, with no clear end in sight. As many expected, funding for FY2014 has been lumped in with discussions about the looming debt ceiling increase, which has an October 17 deadline. House Republicans have proposed a six-week ‘clean’ increase to the debt ceiling, which would push resolution of the matter back until Thanksgiving. However, this plan does not address the shutdown. Republican leaders have indicated they want to alleviate the pressure caused by the debt crisis in order to address the funding issue separately. While the White House has indicated it will consider the House proposal, Senate leaders are moving ahead with their own plan to address the debt ceiling, a proposal which would increase the debt ceiling through December of 2014. This strategy is not expect to go far, as it faces opposition from both House and Senate Republicans. However, in addition to the political posturing and ongoing blame game, it appears some actual progress is being made. A bipartisan group of Senators has begun working on an alternative solution that would address both issues. The discussions are in the early stages and nothing has been endorsed by either party’s leadership, however the fact that the two parties are talking and looking to negotiate a solution is certainly a step forward.