The U.S. House of Representatives passed a stopgap resolution on Tuesday aimed at preventing a partial government shutdown and securing federal funding through September 2025. House Speaker Mike Johnson (R-LA) led the push for the bill, successfully garnering support from the majority of Republicans. However, Representative Thomas Massie (R-KY) opposed the measure, while one Democrat, Representative Jared Golden (D-ME), crossed party lines to vote in favor.
The resolution includes a $4.4 billion increase in security spending, a $440 million boost for immigration enforcement, and a significant $20 billion reduction to the Internal Revenue Service (IRS) budget. Additionally, the bill prohibits Washington, D.C., from utilizing $1 billion of its own tax revenue and grants the Pentagon greater flexibility in acquiring new weapons, a provision insisted upon by Republican defense advocates.
Key Provisions and Political Implications
Beyond its budgetary allocations, the bill notably omits new restrictions on the Department of Governmental Oversight and Efficiency (DOGE) and does not prevent agency heads from dismissing federal employees or canceling federal grants and contracts. These actions are currently subjects of legal disputes, with critics contending that they amount to unlawful impoundments of congressionally approved funds.
The resolution passed the House with a narrow 217-213 vote and now moves to the Senate, where it requires at least 60 votes to advance. This threshold means that at least ten Democrats would need to support the measure for it to pass. Moderate Senate Democrats, including Jeanne Shaheen of New Hampshire, Jacky Rosen of Nevada, and Mark Kelly of Arizona, have yet to indicate their stance. However, Senator John Fetterman (D-PA) has publicly stated that he will vote in favor of the resolution.
Potential Consequences of a Shutdown
Should the bill fail in the Senate, a partial government shutdown could commence as early as Saturday. In such a scenario, the White House budget office would have discretion in determining which federal workers are furloughed with the promise of backpay and which essential personnel must continue working without pay. The military would remain on active duty but would not receive compensation until the shutdown ended.
The possibility of a shutdown has placed additional pressure on lawmakers to reach a resolution swiftly. A prolonged funding lapse could disrupt various federal services and government operations, affecting millions of Americans.
Support from the House Freedom Caucus
The House Freedom Caucus has thrown its support behind the stopgap resolution, describing it as a fundamental shift from previous continuing resolutions. In a statement, the caucus emphasized that the bill reduces and then freezes spending for the next six months, allowing a future administration to address inefficiencies and eliminate wasteful expenditures.
The caucus also underscored that the resolution prevents what they termed a “budget-busting, pork-filled omnibus” for the fiscal year and dismantles the longstanding practice of tying defense spending increases to non-defense expenditures. Additionally, the bill eliminates earmarks and rescinds major funding allocations to the IRS and the “Commerce slush fund.” The legislation also directs additional resources toward immigration enforcement and deportation operations, a provision seen as a victory for Republicans advocating for stricter border security measures.
Looking Ahead
With the six-month funding extension provided by the resolution, Freedom Caucus members have expressed their intent to collaborate closely with the Office of Management and Budget (OMB) and newly appointed cabinet secretaries to further streamline federal expenditures. They anticipate utilizing the reconciliation process to enact long-term spending reforms, aligning with broader Republican objectives to balance the budget and curtail government expansion.
As the Senate prepares to vote, the outcome of this stopgap measure will shape fiscal policy for the remainder of the fiscal year. The decision will also serve as a key indicator of bipartisan cooperation in addressing government funding challenges amid an increasingly polarized political climate.
Lance Jepsen is the senior personal finance writer for Guerilla Stock Trading who has spent more than 25 years covering the stock market and economics. In addition, Lance has worked as a private stock analyst for a number of high worth individuals.
