Financial News
Crunch time: Congress kicks off 2024 staring down potential shutdown
The sheer crush of time is extraordinary. Congress returns to session this week after a lengthy holiday recess – much longer for the House than the Senate. And lawmakers face an immediate shutdown by the end of next week.
This is the perfect way to initiate 2024 in Congress. A flirtation with a shutdown in the opening days epitomizes what 2024 may be like on Capitol Hill.
That said, President Biden and bipartisan, bicameral leaders just forged an agreement on a "topline" for all discretionary spending for the remainder of fiscal year 2024.
This is not a bill. This is not a "continuing resolution," an interim bill to keep the government afloat.
But it’s a start. And there is a lot to do to avoid shutting down the government in just a few days.
With 2024 being an election year – and both the House and Senate controlled by narrow majorities – it could well end with contretemps over election recounts and certifications of House and Senate contests as they sort out which party controls each body heading into 2025. That’s to say nothing of possible debates over who won the presidential election. Naturally, that could tee up yet another set of challenges in the House and Senate on Jan. 6, 2025, to decide who heads to 1600 Pennsylvania, Ave.
So the next 12 months are going to be a doozy in Congress. Hope everyone had a nice vacation.
If Congress struggles to fund the government, one could envision a scenario where lawmakers are marooned in Washington for weeks on end – ala the 10-plus week stretch in the fall. That involved a dalliance with a government shutdown in October, the dethroning of former House Speaker Kevin McCarthy, R-Calif., and an epic, internecine GOP battle before the House finally elected House Speaker Mike Johnson, R-La.
We don’t believe there’s any immediate threat to Johnson’s grasp on the gavel. But once (and if) lawmakers get through the Jan. 19 funding deadline, that only douses the fiscal flames temporarily. There’s another deadline on Feb. 2. The House is scheduled to be out of session the week of Jan. 21. Then back for three weeks. Then out of session the weeks of Feb. 18 and Feb. 25. That’s followed up by three weeks in Washington in early March. Then out at the end of March and first week of April.
HOUSE GOP MAJORITY TO SHRINK AGAIN IN TIME FOR POTENTIAL GOVERNMENT SHUTDOWN SHOWDOWN
A government shutdown crisis could pulverize the congressional schedule. The same with efforts to advance a plan to address border security and fund Ukraine and Israel.
House Republicans are focused on other things, too. They’re looking at impeachment for President Biden, impeachment for Homeland Security Secretary Alejandro Mayorkas and a contempt of Congress citation for Hunter Biden. Throw in some serious, bipartisan questions about why Defense Secretary Lloyd Austin and the Pentagon apparently failed to notify anyone that he was hospitalized, and you have a staggering amount of legislative and political traffic on Capitol Hill.
All of this hinges on the decisions of key players. Whether they negotiate. Whether they stumble. Whether they produce legislative miracles. Success and failure are the quintessence of Congress. So here’s a thumbnail look at some figures to watch in 2024 – and what it could mean for 2025.
Let’s start with the speaker.
Johnson’s immediate future appears to be secure. But if Johnson falters? Or if the GOP loses the majority in the fall? Does Johnson stick around? Divining a potential Johnson successor might be as challenging as it was to forecast the speaker’s rise to power. House Republican Conference Chairwoman Elise Stefanik, R-N.Y., is the only current member of the GOP brass who emerged unscathed from this fall’s battle for the gavel.
Rank and file Republicans rejected both House Majority Leader Steve Scalise, R-La., and House Majority Whip Tom Emmer, R-Minn., for speaker in October. Would Stefanik be in the mix? It’s also possible that President Trump could consider Stefanik as his running mate this year.
Of course, Johnson may be fine. That’s certainly the case if the GOP holds the House, and Johnson placates rambunctious conservatives and demonstrates substantial fundraising prowess.
JOHNSON SPARS WITH WHITE HOUSE OVER BORDER FUNDING CLAIMS: ‘DESPERATE'
Johnson is also just liked better than Kevin McCarthy.
The Freedom Caucus once again commands the spotlight. Pay attention to Rep. Chip Roy, R-Texas, and new Freedom Caucus leader Rep. Bob Good, R-Va.
House Judiciary Committee Chairman Jim Jordan, R-Ohio, and Oversight Committee Chairman James Comer, R-Ky., also bear watching. What do they do with impeachment? And if they don’t impeach, was this duo just making a lot of noise?
House Minority Leader Hakeem Jeffries, D-N.Y., could very well be speaker of the House this time next year if Democrats flip control. But Jeffries is starting to see some fractures in his caucus between progressive, pro-Palestinian Democrats and others who align themselves with Israel. How Jeffries wrestles with those divisions will test his leadership skills.
Another name to keep an eye on: Rep. Suzan DelBene, D-Wash. She chairs the Democratic Congressional Campaign Committee (DCCC). DelBene will benefit big time if Democrats run good races and seize control of the House.
Also watch Rep. John Duarte, R-Calif. He’s one of the most vulnerable Republicans facing re-election this fall, squeaking out a win in 2022 in a district carried by President Biden.
Rep. Don Bacon, R-Neb., is also one of the most bipartisan members of Congress. But Biden won one of the electoral votes in Bacon’s district in 2020 thanks to Nebraska’s proportional distribution system.
In the Senate, the odds certainly favor Republicans flipping that chamber. Democrats are defending way too many seats in swing states. Republicans are facing re-election in states which are already ruby red. However, will Senate Minority Leader Mitch McConnell, R-Ky., return as the top Republican – either in the majority or the minority? McConnell faced a leadership challenge in late 2022 from Sen. Rick Scott, R-Fla. The level of antipathy between former President Trump and McConnell is palpable. Could a second term for former Trump undo McConnell as leader – even though the Kentucky Republican is the longest-serving party leader in history?
Also, McConnell experienced several health scares in 2023. Some Republicans might push for McConnell to step aside if he suffers from additional health concerns.
Granted, McConnell could get credit if the GOP wins the Senate.
This brings us to Sen. Steve Daines, R-Mont. Daines chairs the National Republican Senatorial Committee (NRSC). He’ll win plaudits if Republicans win the Senate – even though it’s an easy map for the GOP. Plus, Daines and McConnell have tried to draft more "electable" Republicans this year. McConnell has spoken at length about how "candidate quality" undercut the GOP’s chances to win the Senate in 2022.
However, don’t underestimate chances for Senate Republicans to botch what could be a layup this autumn. Senate Republicans certainly stole defeat from the jaws of victory in 2022, 2020 and 2010. That’s why there could be hell to pay if Republicans don’t win Senate control. Some Republicans will look directly at McConnell and Daines.
Sen. Joe Manchin, D-W.Va., is retiring. But Manchin is likely to be central to any battles over spending or other major legislation for the duration of his term. There is still buzz about whether Manchin could run as an independent or third party candidate for president.
There is also attention on Sen. Kyrsten Sinema, I-Ariz. Sinema is a central player in the border security talks. She’s outraged some liberals for working as a centrist and abandoning the Democratic Party. If Sinema runs and wins re-election and Republicans flip the Senate, look for the GOP to court her to become part of their prospective majority.
While 2023 was a doozy on Capitol Hill, 2024 could even be doozier. And then there is 2025. Congress punted the debt ceiling until early next year. The congressional certification of the presidential election also falls on Jan. 6, 2025.
The debt ceiling and certifying the results of the Electoral College may be the only big issues with which Congress won’t have to wrestle in 2024.
As I say, I hope you enjoyed your vacation.
Perhaps for the next couple of years.
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.