US House passes bipartisan bill to avoid government shutdown

By David Morgan, Makini Brice and Moira Warburton

WASHINGTON (Reuters) -The U.S. House of Representatives passed a stopgap funding bill on Saturday with overwhelming Democratic support after Republican Speaker Kevin McCarthy backed down from an earlier demand by party hardliners for a partisan bill.

Time remained short to avoid the federal government’s fourth partial shutdown in a decade, which will begin at 12:01 a.m. ET (0401 GMT) on Sunday unless the Democratic-majority Senate passes it and President Joe Biden signs it into law in time.

McCarthy abandoned party hardliners’ earlier insistence that any bill pass the chamber with only Republican votes, a change that could cause one of his far-right members to try to oust him from his leadership role.

The House voted 335-91 to fund the government for another 45 days, with more Democrats than Republicans supporting it.

The move marked a profound shift from earlier in the week, when a shutdown looked all but inevitable. A shutdown would mean that most of the government’s 4 million employees would not get paid – whether they were working or not – and also would shutter a range of federal services, from National Parks to financial regulators.

Federal agencies had already drawn up detailed plans that spell out what services would continue, like airport screening and border patrols, and what must shut down, like scientific research and nutrition aid to 7 million poor mothers.

DEMOCRATS CALL IT A WIN

Some 209 Democrats supported the bill, far more than the 126 Republicans who did so, and Democrats described the result as a win.

“Extreme MAGA Republicans have lost, the American people have won,” top House Democrat Hakeem Jeffries told reporters ahead of the vote.

Democratic Representative Don Beyer said: “I am relieved that Speaker McCarthy folded and finally allowed a bipartisan vote at the eleventh hour on legislation to stop Republicans’ rush to a disastrous shutdown.”

McCarthy’s shift won the support of top Senate Republican Mitch McConnell, who previously had backed a similar measure that was moving through the Senate with broad bipartisan support, even though the House version dropped aid for Ukraine.

McCarthy dismissed concerns that hardline Republicans could try to oust him as leader.

“I want to be the adult in the room, go ahead and try,” McCarthy told reporters. “And you know what? If I have to risk my job for standing up for the American public, I will do that.”

He said that House Republicans would push ahead with plans to pass more funding bills that would cut spending and include other conservative priorities, such as tighter border controls.

CREDIT CONCERNS

The standoff comes just months after Congress brought the federal government to the brink of defaulting on its $31.4 trillion debt. The drama has raised worries on Wall Street, where the Moody’s (NYSE:) ratings agency has warned it could damage U.S. creditworthiness.

Congress typically passes stopgap spending bills to buy more time to negotiate the detailed legislation that sets funding for federal programs.

This year, a group of Republicans has blocked action in the House as they have pressed to tighten immigration and cut spending below levels agreed to in the debt-ceiling standoff last spring.

The McCarthy-Biden deal that avoided default set a limit of $1.59 trillion in discretionary spending in fiscal 2024. House Republicans are demanding another $120 billion in cuts.

The funding fight focuses on a relatively small slice of the $6.4 trillion U.S. budget for this fiscal year. Lawmakers are not considering cuts to popular benefit programs such as Social Security and Medicare.