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The US government shutdown crisis in the shadow of the negative credit rating

The US House of Representatives is considering adopting a temporary measure to prevent a government shutdown due to its negative credit rating.

– International news

According to the international group Tasnim News Agency

, Republicans in the US House of Representatives are considering adopting a temporary measure today to prevent a government shutdown due to its negative credit rating.

This decision was taken after Moody’s rating agency downgraded the government’s credit rating outlook to negative.

According to this report, an informed source who asked not to be named, stated that plans considered for the announcement of the Budget Allocation Bill or CR are still in flux. Of course, it is still not clear what exactly is going to be done.

Mike Johnson, the Speaker of the US House of Representatives, held several days of talks with the Republican majority of this House about CR has done various options.

The Modi Institute has announced the polarization of Congress as an important factor in reducing the government’s credit outlook and stated that it is possible Washington will not be able to reach an agreement to compensate for its growing budget deficit. According to this report, Republicans in Congress and Democratic senators in the Senate should Before the November 17 deadline for the temporary budget bill to avoid a federal government shutdown, they must pass the budget bill for the new fiscal year so that the bill can finally be signed by US President Joe Biden, otherwise until the representatives agree. And for the senators to approve this bill, various departments of the government will be shut down.

The US government faced a budget deficit of 1.7 trillion dollars last year. This figure was the largest budget deficit after the end of the Covid-19 pandemic, and the increase in interest rates means that the cost of services will continue to increase.

But hard-line conservatives are pushing for spending cuts, measures to tighten border security on the U.S.-Mexico border, and to address The unorthodox structure of the deadline for various parts of the federal budget continues.

Many lawmakers warn that the bipartisan battle over This temporary measure could prevent any congressional action to prevent a government shutdown.

This is while a few days ago The Secretary of the Treasury and the head of the Office of Management and Budget of the United States announced in their joint statement that the country’s budget deficit over the past year was 320 style=”color:#281e1e”> billion dollars increased to 1.7 trillion dollars.

The statement said that in fiscal year 2023, which ended on September 30, the US government budget deficit for fiscal year 2023 was recorded at $1.7 trillion, which is $320 billion more than the deficit of the previous year. It was before.

At the same time, the US Department of Treasury recently estimated the national debt of this country It has announced an unprecedented 33 trillion dollars.

U.S. debt rose after President Joe Biden passed a bill in early June that lifted the $31.4 trillion debt ceiling for two years, effectively allowing the government to allowed to continue borrowing without restrictions until 2024.

The cap was removed after repeated warnings from the Treasury that if the cap is not removed, the US government will default on its obligations.

As a result, Less than two weeks after the approval of this bill, the debt of the government of this country reached 32 trillion dollars and has been increasing ever since.

For comparison, four decades ago, the US national debt was about $907 billion. At the current rate, the U.S. national debt is on track to nearly double over the next three decades, according to projections by the Congressional Budget Office.

Also, the Bank of America (BoA) warned in a note, citing data from the Congressional Budget Office, that the country’s government debt may increase by $20 trillion over the next 10 years and reach about $54 trillion.

According to the Bank of America, one of the factors that lead to the increase of this debt is the jump in the federal budget deficit, which increased by 320 billion dollars this year. It reached $1.7 trillion, forcing the Treasury to sell trillions of dollars in new bonds.

US government debt will increase by 20 trillion dollars in the next 10 years
US budget deficit increased by 320 billion dollars

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