In the aftermath of the failed healthcare bill vote, Deutsche Bank now puts a U.S. Govt. shutdown at 40%
There is much speculation that 70 plus days into Donald Trump’s Presidency, the outsider who became Commander-in-Chief may have already spent his political capital. ¬†And we are seeing this right now in Congress’s opposition to discuss tax reforms, the debt ceiling, and even in finding a measly $4 billion to begin construction of a border wall.
And with the Republican led Congress once again mired in the legislature’s inability to get anything done due to even a basic cohesion within their own party, on March 29 Deutsche Bank analysts are now raising the odds on a government shutdown to 40% since they and the markets are believing more and more that a vote to raise the debt ceiling will not get accomplished in a timely manner.
With¬†rumblings growing¬†about a possible Washington shutdown on April 28 when the current continuing resolution expires, Deutsche Bank’s Washington expert Frank Kelly yesterday hosted a client call on the political implications of last week’s events.
He suggested that the surprise withdrawal of the Republican healthcare bill on Friday is a sign of the continued division within the Republican Party and is perhaps a precursor to growing political and policy risks in the US, and as¬†discussed yesterday, he notes that even before considering the difficulties involved in passing President Trump‚Äôs tax reforms, there exists a very real possibility of a government shutdown on April 28 when the current continuing resolutions set to expire.
According to Kelly, there is a significant chance that the Freedom Caucus will reject a new continuing resolution due to their opposition to the continued funding of Planned Parenthood and Obamacare, while Trump‚Äôs spending plans for a border wall will see opposition from both Democrats and Republicans in the Senate.
As a result, Frank estimates the probability of a government shutdown at roughly 40% and notes that the next 2 weeks will be critical to watch. – Zerohedge
Even when the Democrats ran Congress back in the 1980’s, opposition to Ronald Reagan did not spawn personal hatred against him as an anti-establishment President. ¬†And inevitably the two branches were able to reach consensus on numerous things because the needs of the country outweighed pure political ideology.
Additionally, we saw this happen once again in the early 2000’s when following the 9/11 terror attacks, both parties came together to work towards healing the economy, and fighting terrorism.
But the government is much different today, and ideology far outweighs the good of the people and of the nation. ¬†And as such both Republicans and Democrats see Donald Trump as a threat to their power and way of life. ¬†Thus perhaps even more than the healthcare vote debacle, the first real showdown could come very soon when the government finds itself out of money.
Kenneth Schortgen Jr¬†is¬†a writer for The Daily Economist, Secretsofthefed.com,¬†Roguemoney.net, and Viral Liberty, and hosts¬†the popular youtube podcast on Mondays, Wednesdays and Fridays.¬†Ken can also¬†be heard Wednesday afternoons giving an weekly economic report on the¬†Angel Clark radio show.