Sunday, September 26

US looms into paralysis over disagreements over economic stimulus


A US flag flies from the dome of the Washington Capitol

A US flag flies from the dome of the Washington Capitol
Reuters

Tension gripped the US Congress on Friday., where the negotiations against the clock to approve a new stimulus package The economy remained stagnant and threatened to end in a partial paralysis of the US Administration.

The law that allows financing the federal Administration expires one minute after midnight from this Friday to Saturday, and a few hours before that deadline, Congress still had no plans to pass a new spending law, and it was not clear that it would pass a temporary measure to avoid such paralysis.

The reason was the disagreement between Democrats and Republicans on the new stimulus package to mitigate the deterioration of the US economy due to the pandemic, valued at nearly $ 900 billion.

As the Administration funds expire this midnight, the objective of the leaders of Congress was to link the stimulus package to a new bill to finance the Government, thus giving a sense of urgency to the negotiations and reaching an agreement. However, for this Friday afternoon that plan seemed to have failed.

House Democrats planned to push for a temporary spending measure to extend the Administration funds for two more days and avoid paralysisBut it was not clear that the measure could be passed before midnight in the Republican-controlled Senate. “If the paralysis of the Administration only occurs for a short period of time, in a weekend, we hope it will not be something so damaging,” said the “number two” of the Republicans in the Senate, John Thune this Friday.

The leader of the Republican majority in the Senate, Mitch McConnell, has already ensured that the senators will not rest until they reach an agreement, so, in case the funds for the Government expire this midnight, it is likely that legislators spend the weekend negotiating about the stimulus.

If the Administration paralysis lasts only for the weekend, it will probably not have much impact, but if it extends beyond Monday, it could lead to the temporary suspension of some services and the salary of hundreds of thousands of federal workers.

That situation has not occurred since the beginning of 2019, when a disagreement over the financing of the wall with Mexico paralyzed a quarter of the Administration for 35 days, and harmed some 800,000 federal workers.

The main stumbling block in the stimulus negotiations is a proposal to restrict, as part of the package, the emergency borrowing capacity of the Federal Reserve, something that Democrats fear could constrain the future administration of President-elect Joe Biden.

The proposal, promoted by Republican Sen. Pat Toomey, would prevent the Fed’s emergency loan program – created under the pandemic’s first stimulus plan – from continuing next year, and would prohibit the central bank from initiating a program. Similary.

Another disagreement has to do with the demand of Republican Senator Josh Hawley to see clearly reflected in the bill a guarantee that there will be direct money transfers to citizens, which in his opinion should be of 1,200 dollars and not 600, as is planned now.


www.informacion.es

Leave a Reply

Your email address will not be published. Required fields are marked *

Share