As the U.S. federal government’s new fiscal year approaches on October 1st, the budget proposal remains at a stalemate in Congress. Gina Raimondo, U.S. Secretary of Commerce, recently expressed the business community’s apprehension about potential economic challenges that could come from the delayed proposal.
Parties Point Finger at Each Other
Last month, the White House urged Congress to pass a short-term spending agreement to avoid a government shutdown. This workaround prevents federal operations from halting due to a lack of funding.
Partisan disputes have resurfaced as the deadline approaches, with Republicans accusing Democrats of refusing to negotiate on budget issues. Senate Majority Leader Chuck Schumer placed blame on Republicans for pushing the debt limit to the brink earlier in the year.
Gloomy Outlook in the Near Future
A dramatic September in Congress may well happen as senators worry about the budget’s timely approval. Government shutdowns have occurred over 20 times since 1980 due to partisan battles.
This uncertainty poses economic risks, especially that it affects the predictability of doing business. With the 2024 U.S. presidential election on the horizon, political sparring over budget issues is expected to intensify. This could add to the uncertainty in Washington.
