Vice President Vance said that he believed the US government was about to shut down and tried to shift the blame to the Democrats the day before federal funds were due to expire.
“I think we’re headed for a government shutdown because the Democrats won’t do the right thing,” Vance said Monday after meeting with congressional leaders at the White House. “I hope they change their minds, but we’ll see.”
Less than 36 hours before the government shutdown deadline on October 1, President Donald Trump met with top congressional leaders from both the Democratic and Republican parties. The two sides failed to reach an agreement on the Democrats’ demands to extend medical subsidies and reverse cuts to Medicaid funding, which were included in Trump’s landmark tax bill passed earlier this year.
“There are still significant differences between us,” Senate Democratic leader Chuck Schumer said after the meeting. “It’s in the president’s hands,” Schumer added.
However, upon returning to the Capitol, Schumer suggested that the Democrats could first address some priorities, such as extending the premium subsidies under the Affordable Care Act and preventing the White House from using fast-track and unilateral procedures to withdraw federal funds. But he ruled out the possibility of the Republicans passing this stopgap bill without taking action on the Affordable Care Act’s tax credits, and pointed out that millions of Americans would soon receive notices of significant premium increases.
Senate Republican Majority Leader John Thune said that the Democrats’ refusal to approve a short-term spending bill to keep the government running until November 21st was equivalent to “hostage-taking”, but he said that after resolving the current funding deadline issue, he would engage in dialogue with the Democrats.
Vance said the president believes some of the Democrats’ positions are “reasonable.” The vice president mentioned that addressing the funding issue for rural healthcare could be a potential area for compromise.
Although the Republicans hold a majority in the Senate, Republican leaders need at least eight Democrats to vote in favor of any funding measure to overcome procedural hurdles and the opposition of at least one Republican senator, Rand Paul of Kentucky.
Later on Monday, lawmakers were seeking ways to break the deadlock. South Dakota Senator Mike Rounds said he and others had been discussing a possible compromise: extending the ACA subsidies for several years but gradually reducing the benefits to near pre-pandemic levels in the second and third years.
Lance said he believed that if the Democrats agreed to keep the government running, such an agreement could be reached within a few days.
The government shutdown will delay the release of key economic indicators, including the monthly jobs report, which was originally scheduled for Friday, and will result in at least hundreds of thousands of federal workers being temporarily furloughed, while other government employees are forced to work without pay to continue providing essential services.
U.S. stocks pared gains after the Bureau of Labor Statistics announced late Monday morning that it plans not to release economic data during a possible government shutdown.
Trump threatened that if the government shuts down, he will permanently fire all federal workers, which will intensify the impact on the economy. In the past, employees on leave would return to work when the government reopened and receive back pay. However, despite Trump’s threat, no layoff plans have been mentioned in the shutdown plans of various agencies so far.
Vance told reporters that during any work stoppage, “essential services” would continue to operate.
This would be the first government shutdown since 2018-2019. During Trump’s first term, government funding was interrupted for five weeks, including New Year’s Day.
House Minority Leader Hakeem Jeffries told reporters on Monday that Democrats will not accept a mere promise of future cooperation on healthcare policy in exchange for votes on a short-term spending bill to keep the government running now.
“Nobody can believe what they say about health care,” he said, noting that Republicans have been trying to repeal Obamacare for more than a decade. “The American people know that it doesn’t make sense to do so.”
The Democrats hope to spend $350 billion to permanently extend the Obamacare tax credits covering middle-class families to avoid a premium spike on January 1. They also hope the bill will repeal the cuts to Medicaid in Trump’s huge tax bill, including new work requirements and crack down on accounting tricks that allow states to increase Medicaid reimbursement rates. They also hope to reverse cuts to medical research and prevent the White House from revoking previously awarded grants.
