Impasse by federal lawmakers could result in a shutdown
September 2, 2013
A group of Senate Republicans that had been trying to work out a potential compromise with the White House on the federal debt and annual deficits suspended its efforts on Thursday, saying it had reached an impasse. [LATimes]
With a new federal fiscal year starting on Oct 1, conservative and liberal lawmakers are digging in their heals which could result in the shutdown of funding for some departments and agencies.
The GOP controlled house wants to abide with the Budget Control Act of 2011 which requires an equal split between defense and non-defense spending. The Democrat run Senate wants to revoke sequester cuts in the 2011 law and make sure domestic expenditures are not sacrificed to pay for defense spending.
If the two sides are unable to come to a compromise, economic fallout like that seen in 1995 is expected.
The Senate and House are approximately $100 billion apart on total spending for the coming fiscal year. Even if they compromise on the total spending budget, the sides are split on changes to health care and other mandatory spending programs.