For the last several years, there has been a temptation on the part of US lawmakers to hold the overall budget process hostage to other political issues. Republicans famously did this a couple of years ago and the entire federal government came to a screeching halt as the political battle over the size of the budget was fought.
This backfired temporarily, as it seems that people may support budget discipline in theory, but not when it starts to really hit them personally. Since that debacle, there has been little support for taking budget talks to the brink. It was assumed that the process this year would be predictable with both parties making their points but supporting a compromise in the end. That eventually happened, but it came by a far narrower vote than had been expected.
The House vote was very close, with 139 Democrats voting against it and only 57 for it. It now moves to the Senate, where its fate is not at all certain given the control Democrats still have there. If there is a government shutdown this time, the blame will fall on the Democrats. That is not something the White House wants, nor is it the position that most Democrats want to be in.
The bigger issue is that there are now essentially four political parties in the US and two of them are very aggressive. The Republicans have their Tea Party wing and the traditional wing though, in the last set of primary elections, the traditionalists won many of the contests. The Democrats had been more unified, but that seems to end when the last election ended so poorly for them. Now there is an aggressive left wing that is pushing the traditionalists in the Democratic Party. With neither party able to project much in the way of unity, this setting up a very contentious couple of years and could usher in even more political paralysis than existed before.
- Chris Kuehl, PhD, NACM economist