With Shutdown Deadline Looming, Funding Bill Bogs Down

Plus, the huge drop in child poverty ‘is a statistical blip’ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ [The Fisc](   By Yuval Rosenberg and Michael Rainey Welcome to the weekend! We’ve been waiting for this like David Beckham was [waiting]( to pay his respects to Queen Elizabeth. President Joe Biden will be heading to the U.K. tomorrow ahead of the queen’s funeral on Monday. Until then, here’s what’s going on: Senate Minority Leader Mitch McConnell (Reuters) Partisan Disputes Bog Down Bill to Avoid Government Shutdown Once again, the threat of a government shutdown looms at the end of the fiscal year, which arrives on September 30. Lawmakers have two weeks to provide funding to keep large swaths of the federal government open and functioning, and the most likely result at this point is a short-term bill called a continuing resolution that funds the government for about 10 weeks, or until mid-December. Lawmakers would then look to pass an omnibus spending package to cover the rest of the 2023 fiscal year. While Senate Majority Leader Chuck Schumer (D-NY) recently said that he would work with Republicans to "avoid even a hint of a shutdown," numerous unsettled issues remain. What will get bundled with a CR? The first set of questions revolves around the other items that could be included in the funding bill. According to Chris Krueger of Cowen Washington Research Group, there are five additional items in play that could be packaged with the continuing resolution: * Changes in the way energy projects are permitted, supported by Sen. Joe Manchin (D-WV); * A revision of the way electoral votes are counted; * A reauthorization of the user fee system that partially funds the FDA; * Another $13.7 billion in aid for Ukraine; * $22 billion for Covid-19 tests, treatments and vaccines. Not all of the items are expected to make it into the final bill. Republicans remain opposed to providing more funding for Covid-19 preparedness, which could be dropped. And the fate of the energy project permitting reform bill is uncertain, with dozens of House Democrats vowing to oppose it for being too generous to the fossil fuel industry. On Friday, Sen. Ed Markey (D-MA) said he, too, is opposed to the bill, joining Sen. Bernie Sanders (I-VT) in the upper chamber. "As a way forward is discussed, and especially as new anti-environment proposals are being brought to the permitting discussions, we should not attach the permitting overhaul package to the must-pass government funding legislation," Markey said in a statement. If Markey and Sanders stick to their guns and the permitting bill remains in the funding package, the continuing resolution would need 12 Republican votes to meet the 60-vote threshold in the Senate. But Republicans are having their own issues with the package — not least a strong desire to avoid helping Democrats pass any of their agenda items. Roll Call’s Paul M. Krawzak [reports]( that a group of House Republicans affiliated with former president Donald Trump, along with a handful of Senate Republicans, are pushing back against the idea of a short-term funding bill. Betting that Republicans will gain control of the House in the midterm election, they want the continuing resolution to run into early next year so that the new Congress can put its stamp on the final 2023 omnibus spending bill when it is seated in January. "Voters will have fired Speaker Pelosi, but she will still decide all government funding for" fiscal 2023, Republican Study Committee Chairman Rep. Jim Banks (R-IN) said last week. Sen. Rick Scott of Florida is one of the Republicans pushing for a "clean" funding bill. "If there are important issues, don’t just throw it on a CR and give it to us in the last hour," Scott told Roll Call. "Let’s vote on those. Let’s start acting like legislators." Trump has jumped into the fray, as well. "Finally, some Republicans with great Courage!" Trump said. "Rick Scott, Ted Cruz and Mike Lee are working hard to stop Chuck Schumer and his favorite Senator Mitch McConnell from ramming through a disastrous" short-term bill. In a separate statement, Trump took direct aim at McConnell, who he has clashed with in the past. "The Republican Senate must do something about this absolute Loser, Mitch McConnell, who folds every time against the Democrats — and he’s only getting worse!" The bottom line: At this point, nobody wants to cause another government shutdown, but internal divisions among Republicans over strategy could create some sparks as lawmakers hammer out a continuing resolution ahead of a month-end deadline. And the clash between a Trump-backed faction and the more establishment wing of the Republican Party led by McConnell could give us a glimpse of conflicts to come in the next few years. The Huge Drop in Child Poverty ‘Is a Statistical Blip’: Analyst We started the week by telling you about an ["astounding" decline]( in child poverty since 1993, as measured by one metric, the federal government’s Supplemental Poverty Measure. But over at the People’s Policy Project think tank, policy analyst Matt Bruenig greeted that data with some skepticism —and makes a compelling argument that the heralded gains aren’t real. "Whenever you see poverty reports like this, especially ones that seem to have a surprising conclusion, you should ask yourself whether something strange is going on with the poverty metric being used and how it compares to other ways of measuring the poverty rate," Bruenig [wrote]( earlier this week. "I hate debating poverty measurements because the whole thing is so arbitrary and the underlying data driving the analysis in the US is so patchy, but when something like this comes out, I have no choice." Bruenig on Tuesday noted that the Supplemental Poverty Measure data used in the study that found a dramatic drop in child poverty is an outlier compared to other measures of child poverty, which have not fallen nearly as much over the past few decades. Combined with other problems in measuring the benefit of key anti-poverty tax credits, Bruenig concluded that "it’s not clear we’ve reduced child poverty much at all, certainly not in the relative poverty measures typically used for these kinds of questions." He followed up that analysis with another, published Thursday, that argues that the tremendous reduction in child poverty described in the original report by Child Trends is simply the result of a "series break," or a change in methodology and questions by the Census Bureau, the source of the underlying data. "If you remove this obviously bullshit statistical blip from the report, there is basically no child poverty decline at all after the year 2000," Bruenig writes. You can read his analysis [here](. Inflation Reduction Act Will Make Clean Energy More Cost Competitive: Analysis Democrats’ Inflation Reduction Act, the big climate and health care legislation signed into law by President Joe Biden last month, will lead to dramatic declines in the cost of renewable energy over the next decade, according to a new analysis by ICF, a global consulting firm. "For mature technologies, such as wind and solar, these incentives have the potential to supercharge an already-rapid pace of development," the report says. "The IRA could make other emerging technologies, such as green hydrogen and carbon capture and sequestration (CCS) for power applications, economic for the first time." The analysis, first reported by The Washington Post’s Climate 202, notes that tax incentives for clean energy are not new. "What is new," the report says, "is the scale of the support in the IRA, providing potentially trillions of dollars of federal support over the next few decades, and its timing, coming during a period of strong momentum for clean energy and decarbonization." The bottom line: "At over 700 pages, the Inflation Reduction Act (IRA) is a dense piece of legislation," the ICF report says. "At the same time, its impact on the energy sector can be summarized succinctly: clean energy economics just got a whole lot better." If you want more details about the dense, technical new analysis, see [The Washington Post](. --------------------------------------------------------------- Send your feedback to yrosenberg@thefiscaltimes.com. And please encourage your friends to [sign up here]( for their own copy of this newsletter. --------------------------------------------------------------- News - [Pelosi Won’t Say if She Wants to Stay in Charge. 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