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The Republican-dominated U.S. House of Representatives passed legislation on Friday that would prevent a midnight government shutdown, defying President-elect Donald Trump’s calls to also greenlight trillions of dollars in new debt.
Next, the Democratic-controlled Senate must pass legislation to ensure the U.S. government is funded beyond midnight when current funding expires. If approved by the Senate, President Joe Biden intends to sign it into law, the White House said.
The bill would extend federal funding through March 14, provide $100 billion for disaster-hit states and $10 billion for farmers. However, the debt ceiling would not be raised – a difficult task that Trump imposed on Congress before he took office on January 20.
House Speaker Mike Johnson said Republicans would have more power to influence government spending next year if they had majorities in both chambers of Congress and Trump was in the White House.
“This was a necessary step to bridge the gap and bring us to the moment where we can leave our fingerprints on final spending decisions,” he told reporters after the vote. He said Trump supports the package.
A government shutdown would disrupt everything from law enforcement to national parks and pause paychecks for millions of federal workers. A travel industry trade group warned that a shutdown could cost airlines, hotels and other businesses $1 billion a week and cause widespread disruption during the busy holiday season. Authorities warned that travelers could expect long lines at airports.
The package, approved by a bipartisan vote of 366-34, was similar to a bipartisan plan that was abandoned earlier this week after Trump and his billionaire adviser Elon Musk criticized online for having too many independent provisions, such as a Salary payment, includes increase for legislators and crackdown on pharmacy benefit managers.
Republicans stripped most of those elements from the bill — including a provision limiting investments in China, which Democrats said would have been at odds with Musk’s interests.
“He obviously doesn’t want to answer questions about how much he wants to expand his business in China and how much American technology he wants to sell,” Democratic Rep. Rosa DeLauro said on the House floor.
Musk is happy with the deal
Trump has tapped Musk, the world’s richest person, to lead a task force on budget cuts, but Musk holds no official position in Washington.
Musk wrote on his social media platform X that he was happy with the package. “It went from a bill that weighed pounds to a bill that weighed ounces,” he posted.
House Democratic leader Hakeem Jeffries said the package still achieved key goals such as providing disaster relief, averting a shutdown and preventing Republicans from raising the debt ceiling, which would make tax cuts easier.
“We have successfully advanced the needs of everyday Americans, but there are still things to work on and we look forward to that fight in the new year,” he told reporters.
Trump’s call to raise the debt ceiling was soundly rejected by the House of Representatives – including 38 Republicans – on Thursday.
The federal government spent about $6.2 trillion last year and has more than $36 trillion in debt. Congress must take action to authorize more loans by the middle of next year.
Rep. Rich McCormick, one of 34 Republicans who voted against the bill, said it doesn’t change the country’s fiscal trajectory and would only increase the debt burden. “We will be the country of the past if we continue the way we are doing,” he said.
The federal government recently closed for 35 days during Trump’s first term because of a dispute over border security.
Previous disputes over the debt ceiling have unsettled financial markets as a U.S. government default would trigger credit shocks around the world. The limit was suspended under an agreement that technically expires Jan. 1, although lawmakers likely wouldn’t have had to address the issue until the spring.
