SEC shutdown averted – for now
Showdown on Capitol Hill put off for two weeks (Bloomberg News)
Next round of budget brinkmanship comes on March 19
The Senate overwhelmingly approved a bill on Wednesday that will keep the government running through March 18, averting a shutdown that loomed later this week.
The Senate passed the so-called continuing resolution, 91-8, attaining a comfortable margin similar to the House’s 335-91 approval of the bill on Tuesday. The measure would cut $4 billion from the fiscal 2010 budget which federal agencies have been operating on since October, when Congress failed to enact a fiscal 2011 budget.
The continuing resolution was scheduled to expire on March 4. If it had, federal agencies would have been forced to halt non-essential activities on March 5.
Last week, the Securities and Exchange Commission was doing contingency planning for a shutdown by determining which of its activities are essential. It’s unlikely that investment adviser exams would fall into that category, meaning that SEC audits or interviews would be postponed.
Although Congress has given itself a two-week reprieve, Democrats and Republicans could still be headed for a budget collision that would result in a shutdown on March 19.
The parties remain far apart on fiscal matters. The $4 billion in cuts in the two-week continuing resolution essentially represent low-hanging fruit on which the parties and President Barack Obama can agree.
Future compromise will be much thornier. Republicans, stoked by freshmen conservatives in the House, themselves spurred on by the Tea Party movement, approved a House bill last month that would cut $61 billion from the current budget for the seven months remaining in fiscal 2011. Democrats have called that approach “irresponsible.”
Mr. Obama is entering the fray to try to keep the government on its feet. He is calling on bipartisan congressional leaders to meet with Vice President Joe Biden and White House chief of staff William Daley to work out a long-term funding agreement.
“Living with the threat of a shutdown every few weeks is not responsible, and it puts our economic progress in jeopardy,” Mr. Obama said in a statement on Wednesday. A new budget “should be bipartisan, it should be free of any party’s social or political agenda, and it should be reached without delay.”
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