The is Senate back in session this week, meaning there there are only 3 weeks until September 30th- the deadline for a resolution to avoid a government shutdown. Greg Valliere Chief U.S. Policy Strategist, AGF Investments doubts a resolution will be reached due to “hardliners in the House who want to ‘defy’” House Speaker Kevin McCarthy with “unrealistic demands.” Nonetheless, Valliere does not think there will be any dire implications from the shutdown. As far as budgeting reform goes, Semafor Editor-at-Large Steve Clemons argues that it would only be possible if “those at the edge of power” can hold McCarthy “hostage.” Regarding a final solution, Valliere insists that either a temporary resolution will be put in place or shutdown will take place, but either way- “this thing is going to drag on until the middle of December.”

Video Transcript

JULIE HYMAN: Let's talk more about domestic politics for a moment. The Senate back in session tomorrow, which has about three weeks to pass spending legislation before September 30th or, we're talking about it again, the government shutdown. Greg, I'll go to you first on this. Do you think there will be a resolution before the deadline?

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GREG VALLIERE: Probably not. I think there are enough hardliners in the House who want to defy Kevin McCarthy. I think their demands are totally unrealistic. And I think there's a decent chance there will be a shutdown. I don't think it's a huge negative for the economy if there's a shutdown. I mean, if you want to go to a National Park, maybe you can't. But you know, the Fitch rating agency this summer talked about how dysfunctional our budget process is, and they'll get more ammunition for that argument probably at the end of this month.

BRAD SMITH: Yeah, and you sensed that in Julie's voice earlier as well. I mean, in all of us wanting to hit the "I'm tired, I got to go to bed now" on this discussion every time it comes up. You know, Steve, is there going to be-- is there likely to ever be any type of budgeting reform so that we don't always get to this impasse?

STEVE CLEMONS: Well, budgeting reform would mean that legislators who are right at the edge of power-- you know, the Marjorie Taylor Greens and the Chip Roys and others who can-- the Matt Gaetzes who can hold the Speaker of the House essentially hostage to whatever positioning they've got. It's-- when you have a narrow majority, you're not going to reform anything because someone in that equation has a lot of power.

So my answer is unequivocally no. I agree with Greg's assessment. But the other, you know, fly in the ointment here is that before you get to this, some of those holdouts and those hardliners are demanding, you know, an impeachment inquiry into President Biden. And so I think-- I think Kevin McCarthy is going to have an interesting month.