U.S. Senate passes funding bill to avoid Oct. 1 govt shutdown

By David Lawder

A deeply divided and unproductive Congress wrapped up its final business before November’s elections early on Saturday as the U.S. Senate passed a stopgap measure to fund federal programs and avoid an Oct. 1 government shutdown.

The 62-30 vote on the funding bill, which now moves to President Barack Obama’s desk to be signed into law, was delayed by days of partisan bickering over votes on unrelated measures aimed at boosting both Democrats’ and Republicans’ political fortunes.

For the new fiscal year which begins on Oct. 1, the $524 billion measure slightly raises discretionary spending – which funds government agencies and everything from defense to national parks – from current levels.

It was needed because Congress’ normal process of appropriating money for government operations broke down amid disagreements between Democrat and Republicans over spending levels and funding was due to run out after Sept. 30.

“It is an inefficient way to fund the federal government but it is better than shutting it down next week,” said Democratic Senator Daniel Inouye, the Democratic chairman of the Senate Appropriations Committee.

Congress’ bitter fights over spending cuts and raising the debt limit last year led to threats of several shutdowns as temporary funding measures expired. The last time government funding actually ran out was late 1995 and early 1996, forcing then-president Bill Clinton to shut down non-essential services and furlough non-essential government workers for 28 days.

Saturday’s vote allows lawmakers to return to their home states for a final re-election campaign push, but they leave a huge to-do list for their return after the Nov. 6 election.

By keeping the government funded through March 27, Congress has somewhat lightened its post-election workload, which centers on dealing with expiring tax cuts, automatic spending cuts, a debt limit increase and other fiscal deadlines.

With relative peace over the budget, lawmakers will be able to takle more difficult difficult questions – how to avoid $109 billion in automatic budget cuts that start on Jan. 2, and whether to extend some or all of the tax cuts enacted under former President George W Bush, which expire Dec. 31.

Moody’s Investors Service has threatened to downgrade the U.S. credit rating if Congress’ deliberations do not reduce budget deficits in a meaningful way. Economists warn that the United States will slide back into recession if Congress fails to take action to mute the massive impact of tax hikes and spending cuts.

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