US House Republicans Unveil Shutdown-Averting Measure in Response to Credit Warning

By David Morgan

WASHINGTON (Reuters) – U.S. House of Representatives Republicans are working on a stopgap measure to prevent a partial government shutdown following the Moody’s credit agency lowering its outlook on the government’s credit ratings to “negative.”

An anonymous source revealed that the release plans for the continuing resolution, or “CR,” are still uncertain. The form of the measure is also unclear at this time.

U.S. House Speaker Mike Johnson has been in talks with members of the Republican majority about various CR options. Both the Republican-controlled House and Democratic-led Senate must collaborate on a solution that President Joe Biden can approve before the current funding expires on Nov. 17.

Moody’s cited political polarization in Congress as a factor in its decision to lower the credit outlook, expressing doubts about Washington’s ability to reach an agreement to make its growing deficits more manageable.

The U.S. recorded a $1.7 trillion deficit last year, and rising interest rates mean that the cost of servicing that debt will continue to increase.

Previously, Congress brought the U.S. close to defaulting on its more than $31 trillion in debt, which could have had severe impacts on world financial markets.

With a potential shutdown just days away, some Republicans are pushing for a “clean” CR running until mid-January and containing no spending cuts or conservative policy riders that Democrats oppose.

However, hardline conservatives are advocating for a measure with spending cuts, policies such as tighter security at the U.S.-Mexico border, and an unusual structure with staggered deadlines for different segments of the federal budget.

Many lawmakers are warning that a prolonged partisan battle over the stopgap measure could lead to a shutdown.

While House Republicans deliberated their options this week, Senate Majority Leader Chuck Schumer took an initial procedural step towards moving his own stopgap measure.

(Reporting by David Morgan; Editing by Daniel Wallis and Grant McCool)


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