Biden administration prepares for possible govt shutdown

U.S. President Joe Biden's administration is preparing for a possible government shutdown in the event that current funding runs out on September 30, White House press secretary Jen Psaki said on Thursday.

"It's consistent with longstanding practice across many administrations for OMB to simply remind agency senior staff of the need to review and update orderly shutdown plans," Psaki said at a press briefing, referring to the Office of Management and Budget.

She added the reminder was not a formal guidance, but a routine step. 

A government shutdown typically leads to hundreds of thousands of federal workers being sent home while parks, museums and other federal properties and services are closed.

Psaki noted that the Biden administration is taking steps to mitigate the impacts of a potential shutdown on U.S. pandemic response, economic recovery and other priorities.

"The fact is shutdowns are incredibly costly, disruptive and damaging. Direct public health efforts can generally proceed during a shutdown because they're exempt, and that is certainly our intention," she said.

Psaki's comments came after the Democratic-controlled U.S. House of Representatives on Tuesday night passed a bill that would prevent a federal government shutdown and suspend the debt limit on government borrowing into December 2022.

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The bill now heads to the Senate, where Republicans have vowed to block it. Senate Minority Leader Mitch McConnell signaled on Monday that Republicans would help pass a short-term government funding bill only if Democrats separate it from a plan to suspend the debt limit.

"Depending on what happens there, we will keep government open by September 30, which is our date, and continue the conversation about the debt ceiling," House Speaker Nancy Pelosi said Thursday at a press conference, adding that Congress will find a way to avert a government shutdown next week.

The House passed a "continuing resolution" on Tuesday that would keep federal agencies open until December 3, a move supported by Republicans. But Democratic leaders also attached the debt ceiling suspension following warnings that the Treasury Department will be unable to obtain new loans in October.

The debt ceiling is the amount above which the country cannot issue new loans to fund government agencies and make loan repayments. Republicans usually support raising the debt limit but have vowed to block any stopgap funding bill that extends the Treasury Department's borrowing authority this time around.

Economists estimate that failure to extend the debt limit would erase six million jobs and wipe out $15 trillion of household wealth, tanking the economy and threatening a global meltdown.

(With input from Xinhua, AFP)

(Cover: A tourist stands at the northern side fence of the White House in Washington, D.C., July 5, 2021. /CFP)

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