It may finally be time for Trump’s ‘good shutdown’

Two deadlines in late April resulted in a punt to September, as Republicans attempted to avoid complicating their healthcare push.

The September deadline resulted in a punt to December because the bill was tied to a critical increase in the debt ceiling. The December deadlines were pushed back because of a combination of disagreements over key policy issues — and the holiday break. As the conservative House Freedom Caucus feared, lawmakers don’t like sticking around Capitol Hill on Christmas.

Why this time is different

Congress has been fine with punting on a long-term funding solution before — but now there is urgency to complete a longer-term deal. That means, however, that the chances of a shutdown are higher.

Greg Valliere, chief strategist at Horizon Investments, said the odds of a short-term punt don’t seem as great this time.

“Perhaps there will be another extension, but the ‘kick the can down the road’ strategy, which was so popular last fall, has fewer supporters now,” Valliere said in a note to clients. “We got a couple of emails yesterday from readers who think Congress is crying wolf once again on a government shutdown, but we think this time may be different.”

The January deadline seems opportune because no outside legislative issues that lawmakers want to attach to the funding bill — the Deferred Action for Childhood Arrivals immigration program, Children’s Health Insurance Program, and others — have a hard and fast deadline.

This could make ideological conservatives more likely to oppose any short-term bill — and Democrats more likely to push for their legislative priorities to be added.

Those same issues, however, are ideological sticking points for different factions of each party, and agreements won’t be easy to reach.

Chris Kreuger, an analyst at Cowen Washington Research Group, said in a note to clients Thursday that Trump may not consider a government shutdown a bad outcome for a few reasons. For one, Kreuger said, it would play to Trump’s “Drain the Swamp” narrative.

For another, Kreuger added, Trump may view the shutdown as a power play.

“Analogous to President Reagan firing the air-traffic controllers, this will make Trump look like a strong leader standing up for the core deliverables his base wants, i.e. The Wall,” the strategist said.

Additionally, Kruger wrote, a shutdown could play into the hands of both parties.

“The central irony in this standoff is that both Trump and Congressional Democrats believe they command the high ground,” he said. “Trump believes a shutdown over funding The Wall is good politics for him and the Congressional Democrats believe shutting down the government over DACA/Dreamer funding is good politics for them — they both may be right.”

Why this time isn’t different

A few factors in this round of negotiations, however, point to Congress either avoiding a shutdown with a large package or simply punting again.

Congressional leaders have been working on the same core set of issues as part of a funding package since September. Democrats are still insistent on codifying the DACA program, but the deadline to do so won’t come until March. They’ve already punted on items like CHIP before with short-term extensions in funding.

A shutdown would be a serious black eye for Republican leaders. It would also be the first time since 1979 that a party has allowed the government to shut down while controlling Congress and the White House.

And if employees are furloughed or sent on leave, it would be the first time that has ever happened under one-party control.

Maintaining the status quo is fairly simple in Washington, and punting on the deadline again could be the simplest solution — for now.

“Even if these issues are resolved quickly, which looks unlikely, still another enormous budget issue looms in March,” Valliere said. “Raising the debt ceiling, which cannot be accomplished without help from Democrats.”