Written by Richard Cowan, Bo Erickson, Andy Sullivan, and Katherine Jackson
WASHINGTON (Reuters) – The U.S. Congress passed spending legislation early on Saturday in a sweeping flurry of activity that will avert a destabilizing government shutdown ahead of the busy holiday travel season.
The Democratic-controlled Senate approved by 85 votes to 11 a bill to continue government funding 38 minutes after it expired at midnight (0500 GMT Saturday). The government did not invoke lockdown measures at this time.
The bill will now be sent to the White House, where President Joe Biden is expected to sign it into law.
The package had previously been approved by the Republican-controlled House of Representatives with bipartisan support.
The late-night vote capped a frenetic week that saw President-elect Donald Trump and his billionaire ally Elon Musk defeated in the initial bipartisan agreement, throwing Congress into disarray.
The final version deleted some provisions supported by Democrats, who accused Republicans of giving in to pressure from an unelected billionaire with no experience in government.
Congress took no action on Trump's request to raise the debt ceiling, a politically difficult task, before he took office on January 20.
The federal government spent nearly $6.2 trillion last year and has more than $36 trillion in debt, and Congress will need to act to allow more borrowing by the middle of next year.
The legislation would extend government funding through March 14, provide $100 billion to disaster-hit states and $10 billion to farmers, and extend agricultural and food assistance programs scheduled to expire at the end of the year.
Some Republicans voted against the package because it did not reduce spending. House Speaker Mike Johnson said the party will have more influence next year, when it will gain a majority in both chambers of Congress and Trump will be in the White House.
“This was a necessary step to bridge the gap, putting us in that moment where we can put our stamp on the final decisions on spending,” he told reporters after the House vote. He said Trump supports the package.
A government shutdown would have disrupted everything from law enforcement to national parks and suspended the paychecks of millions of federal workers.
A travel industry trade group warned it could cost airlines, hotels and other businesses $1 billion a week and lead to widespread disruptions during the busy Christmas season. Authorities have warned that travelers may face long queues at airports.
Third attempt
The package is similar to a bipartisan plan that was abandoned earlier this week after a major online barrage from Trump and Musk, who said it contained too many unrelated provisions, such as raising lawmakers' salaries and cracking down on pharmacy benefits managers.
Republicans deleted most of these elements from the bill, including the provision limiting investments in China, which Democrats said would have conflicted with Musk's interests.
“It is clear that he does not want to answer questions about the extent of his plans to expand his business in China and how many American technologies he intends to sell,” Democratic Representative Rosa DeLauro said on the House floor.
Trump assigned Musk, the richest person in the world, to head a task force to reduce the budget, but he will not hold any official position in Washington.
Musk wrote on his social media platform X that he is happy with the package. “I went from a pound note to an ounce note,” he posted.
House Democratic Leader Hakeem Jeffries said his party is still achieving some of its goals and preventing Republicans from enacting a debt ceiling hike that would make it easier to cut taxes.
“We have succeeded in meeting the needs of ordinary Americans, but there are still things to work on, and we look forward to that fight in the new year,” he told reporters.
Trump's demand to raise the debt ceiling was met with a resounding rejection by the House of Representatives – including 38 Republicans – on Thursday.
Johnson said lawmakers will consider the issue in January.
Rep. Rich McCormick (NYSE:), one of 34 Republicans who voted against the bill on Friday, said it did nothing to change the country's fiscal trajectory and would only increase the debt burden.
“We will be the state of the past if we continue doing what we are doing,” he said.
The federal government was last shut down for 35 days during Trump's first term in the White House over a dispute over border security.
Previous battles over the debt ceiling have spooked financial markets, as a US government default would send credit shocks around the world. That limit has been suspended under an agreement that technically expires on Jan. 1, though lawmakers likely won't have to address the issue before the spring.
