New House, New Discussion – Republican Party Preview Their Plans
After 14 grueling ballots for the Speaker of the House vote, Republican Kevin McCarthy won the 15th vote by receiving a majority of the votes, finally. The vote for the Speaker of the House provided the public with a preview as to how the next two years are going to look like for our government, and the cracks in the Republican Party are going to play a major role on how they navigate their majority in the House. Let’s preview some of the economic priorities the House has on their mind for the next 2 years.
First, Republicans look to nullify the billions of dollars President Biden spent on bolstering the IRS to increase employment and reduce the amount of dollars the government is losing when collecting taxes. The GOP has opposed this measure heavily, promising to their constituents that “they won’t let the Democrats send the IRS after them,” and the polarizing nature of this idea shows that Democrats will not jump the aisle to support this in any manner.
Second, and most importantly, is the upcoming debate on raising the debt ceiling. Analysts from Goldman Sachs project that the debt ceiling will need to be raised by sometime around August to prevent the US from defaulting, but the concessions Kevin McCarthy had to make to his own Republicans to win the vote is set to create a standoff. Republican ideals are against government spending, so they want him to force Democrats to cut spending instead of opting to raise the debt ceiling. This increases the chance of a government shutdown, if not default as there seems to be virtually no common ground, and McCarthy can’t go back on his concessions because all it takes is one member of Congress to create a motion for him to vacate, another concession he made.
This upcoming session will come with a lot of legislative chess being played from both sides as a fractioned Republican party means McCarthy might need to come to Democrats for help. Partisan politics from both sides is all fun and games, but it’ll be the citizens of the United States who suffer the most in the end.
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I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.
