Congressional Factions Clash Over Federal Funding Strategy

Congressional Factions Clash Over Federal Funding Strategy

Lawmakers and the Trump administration are at odds over how to fund the government, with fiscal hawks and the White House pushing for static funding levels while Democrats and some Republicans advocate for delayed negotiations. The standoff centers on Speaker Mike Johnson’s willingness to pass a funding package aligned with Trump’s preferences, and whether Senate Democrats will yield to avoid a government shutdown. Tensions are escalating due to Trump’s unilaterally canceling $5 billion in foreign aid, prompting Democrats to warn of a funding lapse without a compromise. Bipartisan talks are ongoing, but major uncertainties and partisanship remain.

On one side of the debate, fiscal hawks are joining with the White House to keep federal agencies running on static funding levels, ideally into January or longer. This approach seeks to avoid a government shutdown without committing to new spending levels. On the other side, Democrats and some top Republicans want to punt no further than November to buy congressional negotiators more time to cut a cross-party compromise on fresh funding totals for federal programs.

Speaker Mike Johnson’s appetite for passing a funding package aligned with President Donald Trump’s preferences could determine the outcome. If Johnson decides to push for such a package, he would be aligning with fiscal hawks and the Trump administration but at the expense of Democratic support. Senate Democrats, led by appropriator Brian Schatz, are warning that a failure to reach an agreement could result in a government shutdown on October 1. Schatz, a top appropriator, warned during an interview that past attempts to force a deal were unsuccessful and that Republicans would need to recognize that they would not be able to push for unilateral action again without facing consequences.

Democrats are also signaling that they are willing to make concessions, such as extending the enhanced health insurance subsidies set to expire in January, to gain Republican support. They are cautious about making firm demands on funding totals or specific policy issues, but they are beginning to show more assertiveness by floating potential concessions Republicans could make in exchange for bipartisan support. This includes a deal to head off the expiration of the enhanced subsidies, which could result in premium hikes for millions of Americans come January.

Behind the scenes, bipartisan negotiations are taking place, but they remain fragile. Johnson and Minority Leader Hakeem Jeffries recently discussed passing a short-term spending bill until November or December, though no decisions have been made. Appropriators are also working on a hybrid approach, seeking a full-year funding bill for specific agencies like the USDA and the Department of Veterans Affairs, while keeping other agencies on a short-term extension to allow for further negotiations.

The situation, however, remains uncertain. Some Senate Republicans, including John Kennedy, are skeptical that a comprehensive bipartisan funding deal is possible. The odds of avoiding a government shutdown are estimated at “50-50, perhaps higher,” according to Kennedy. The top Senate leaders, John Thune and Chuck Schumer, have yet to engage in discussions about the funding deadline, further indicating that cross-party cooperation is still in its early stages.

Meanwhile, House hardliners, backed by some of their conservative Senate counterparts, are digging in to demand a lengthy stopgap bill, rather than a short-term patch meant to facilitate a more comprehensive bipartisan funding measure. One Republican, granted anonymity to share the conservative strategy, said fiscal hawks want a funding patch “to 2026” or for the entirety of the coming fiscal year “if we can get it.”

Continually running the government on stopgaps is part of White House budget director Russ Vought’s strategy to shrink federal spending as he roots for the government funding process to be “less bipartisan.” These kick-the-can funding bills give the White House more leeway to shift cash while depriving Democrats of any increases in non-defense funding and GOP defense hawks the military budget increases they seek. Then, using party-line measures like the domestic-policy megabill and the $9 billion clawbacks package Congress cleared this summer, Republicans can add or subtract funding without needing to rely on the votes of Senate Democrats.

The White House predicts that Trump’s more recent, unilateral cancellation of $4.9 billion will only help build support among GOP fiscal hawks for a “clean” continuing resolution, or CR, that simply drags out current funding levels for weeks or months more. In this scenario, Democrats will have to fall in line, a White House official told reporters late last month after Trump nixed the foreign aid funding.

“It’s very hard for me to believe that they’re going to oppose a clean CR that would cause them to be responsible for a government shutdown,” said the official, granted anonymity to speak candidly.

The Senate’s top Democratic appropriator, Patty Murray of Washington, has warned that it won’t work for Republicans to blame Democrats: If the GOP goes it alone, she said last week, “well, then, that is a Republican shutdown.”

Democrats are also still grappling with how the pocket rescission will factor into their government funding demands. Schatz called it a “point of friction” but added, “I’m not prepared to articulate any red lines to you.”

Notwithstanding the administration’s latest attempt to revoke funding, setting static funding levels for the government is seen as a nonstarter by many within both parties. Democrats fear that a lengthy stopgap bill would weaken their leverage and potentially leave them in a worse position should talks fail. Republicans, meanwhile, are divided on whether a full-year flat funding bill is feasible or if it would undermine the military. House Appropriations Chair Tom Cole is urging colleagues to negotiate a bipartisan deal rather than rely on a continuing resolution, but he has not yet secured leadership approval to do so.

These deepening divisions suggest that a timely and comprehensive funding agreement is unlikely, with the threat of a government shutdown looming as lawmakers continue to negotiate under intense pressure.