Johnson Rules Out Vote to Pay Troops During Shutdown
Good Wednesday evening! In a federal court in Virginia today, former FBI Director James Comey pleaded not guilty to charges that he lied to Congress five years ago. The case has raised concerns that the Justice Department is pursuing retribution against the president's perceived enemies. Comey's lawyers indicated they will argue that it is a vindictive prosecution "brought at the direction of President Trump" and, as such, the charges should be thrown out.
In a related development, Trump said in a social media post that Chicago Mayor Brandon Johnson and Illinois Gov. JB Pritzker, both Democrats, "should be in jail" for failing to protect immigration officers, escalating the clash over his push to deploy National Guard troops to Chicago. Pritzker responded by saying in his own social media post that he will not back down. "Trump is now calling for the arrest of elected representatives checking his power," he wrote. "What else is left on the path to full-blown authoritarianism?"
Here's your mid-week update.
Johnson Rules Out Vote to Provide Military Pay During Shutdown
With the shutdown in its eighth day, Speaker Mike Johnson said Wednesday that he does not plan to allow the House to vote on a standalone bill to pay military personnel.
Facing a potential missed payday for servicemembers on October 15, Johnson indicated earlier this week that he was open to the possibility of voting on a bill introduced by Republican Rep. Jen Kiggans that would provide military pay during shutdowns in the 2026 fiscal year. The bill has 122 bipartisan cosponsors in the House.
Johnson changed course Wednesday, telling reporters at a morning press conference that the House had already voted to pay troops three weeks ago when it passed a continuing resolution to fund the government until November 21 - a bill that has repeatedly failed to win sufficient support from Democrats to get through the Senate.
"The job in the House is done," Johnson said. "Hakeem Jeffries and the House Democrats ... are clamoring to get back here and have another vote, because some of them want to get on record and say they're for paying the troops," he added. "We already had that vote. It's called the CR."
Kiggans called on party leaders to reconsider. "I'm urging the Speaker and our House leadership to immediately pass my bill to ensure our servicemembers, many of whom live paycheck to paycheck while supporting their families, receive the pay they've earned," she said in a statement. "Military pay should not be held hostage due to Washington's dysfunction!"
A large group of Democratic lawmakers also called on Johnson to allow a vote on bipartisan legislation that would ensure servicemembers get paid during the shutdown. "There's no excuse for inaction, because when it comes to paying our troops, there is no room for partisan politics," reads a letter spearheaded by Reps. Derek Tran and Gabe Vasquez and signed by 75 other House Democrats.
In previous shutdowns, Congress typically provided for military pay ahead of time one way or another, shielding servicemembers from lost wages, but this time around is different. If the shutdown continues and Congress does not act, October 15 will mark the first time in modern history that all military personnel will miss a paycheck due to lawmakers' failure to fund the government.
White House considers options: The White House is reportedly looking into ways to ensure that the military gets paid on October 15. Politico's Meredith Lee Hill says the options include diverting existing funds to cover the cost and pressuring Congress to pass a standalone bill.
Asked Wednesday if he would call on Congress to pass a bill to pay servicemembers, Trump said, "Yeah, that probably will happen."
"We [don't] have to worry about it yet," Trump added. "That's a long time. You know what one week is for me, an eternity? One week for me is a long time. We'll take care of it."
Senate Rejects Funding Bills Again
The Senate on Wednesday again blocked a pair of bills that would fund the federal government. Needing 60 votes to pass, a Republican bill failed in a 54-45 vote. A second bill backed by Democrats failed 47-52.
Three senators in the Democratic caucus - John Fetterman of Pennsylvania, Catherine Cortez Masto of Nevada and Angus King of Maine - voted in favor of the GOP bill, as they have previously. One Republican, Sen. Rand Paul of Kentucky, voted against the GOP bill.
The vote marks the sixth time the Senate has failed to pass the bills, and there are no signs that the stalemate is coming to an end any time soon.
IRS Furloughs Nearly Half Its Workforce
The IRS said Wednesday that it is furloughing nearly half its employees due to the government shutdown. In an update to its shutdown contingency plan, the agency said that 39,870 of its 74,299 employees - 53.6% - will continue working during the shutdown. The agency's initial shutdown plan called for using funding from the 2022 Inflation Reduction Act passed by Democrats to continue operations for five business days.
US Budget Deficit Held Steady at $1.8 Trillion in 2025: CBO
The Congressional Budget Office estimates that the U.S. government's budget deficit for fiscal year 2025 totaled $1.8 trillion, just $8 billion less than the shortfall for the prior year. If not for shifts in the timing of certain outlays, the annual deficit would have been $80 billion less than in 2024, CBO said.
The annual total was also affected by the accounting for changes to the federal student loan program that resulted in a $131 billion reduction in outlays, a one-time adjustment based on expected future cash flows from outstanding loans. Without that change, the deficit would have topped $1.9 trillion.
How revenues changed: Federal revenues for the year grew by $308 billion, or 6%, to $5.2 trillion, driven by individual income and payroll taxes that rose a combined $260 billion. Customs duties, including tariffs, rose to $195 billion, up $118 billion, or 153%, compared with 2024.
Those gains were partially offset by a $77 billion (15%) drop in corporate tax collections, the nonpartisan budget scorekeeper said in its monthly report for September, marking the end of the fiscal year. CBO said the decrease was partly the result of President Trump's signature tax and spending law, which allowed corporations to take larger deductions for some investments, reducing estimated payments.
Where spending grew: Spending rose by $301 billion, or 4%, to $7 trillion, as spending on major safety net programs grew by 8% and net interest payments on the public debt surpassed $1 trillion for the first time. Spending on Social Security benefits rose by $121 billion while Medicare outlays grew by $72 billion and Medicaid outlays climbed $52 billion. Net interest spending increased by $80 billion. Spending at the Departments of Veterans Affairs, Defense and Agriculture was up by 12%, 5% and 14%, respectively. Outlays for the Department of Homeland Security jumped $25 billion, or 25%, mostly due to FEMA disaster-response spending.
CBO noted that congressional budget committees instructed it to publish its monthly report despite the ongoing government shutdown because the information it provides is necessary for Congress to carry out its constitutional functions.
Fiscal News Roundup
- "The House Is Done": Johnson Rules Out Stand-Alone Vote on Paying Troops During Shutdown – Axios
- Trump Says Bill Guaranteeing Military Pay During Shutdown 'Probably Will Happen' – The Hill
- House Dems Prep Letter to Johnson Urging Vote on Troop Pay Bill – Politico
- Military Families Brace for Missed Paychecks as Shutdown Impacts Are Already Accumulating – CNN
- Speaker Clashes With Dem Senators Over Epstein Files Amid Shutdown – Politico
- White House Draws Out Mass Federal Firings Timeline as GOP Grows Squeamish in Funding Fight – CNN
- The Trump Admin Said Furloughed Feds Were Not Guaranteed Back Pay. On Wednesday, It Sent Notices Saying They Were – Government Executive
- 'Do Your Damn Job': Federal Worker Union Leaders Slam Congress, Trump – Associated Press
- Trump's Off-Script Comments Cause Shutdown Headaches for GOP – Politico
- How Businesses Are Already Feeling Shutdown Pain – Wall Street Journal
- IMF Chief Warns of Economic Uncertainty and Offers This Advice: 'Buckle Up' – Associated Press
- Court Ruling Allows Medicare to Negotiate Prices for Larger Number of Drugs – STAT
- Health Agencies Lose 'the Backbone Folks Who Can Keep Things Running' to Indian Health Deployments – Politico
- These Activists Want to Dismantle Public Schools. Now They Run the Education Department – ProPublica
- California's Newsom Signs Bill to Curb Private Equity's Role in Healthcare – Wall Street Journal
- Treasury Department Defends Trump $1 Coin Plan – The Hill
- Bob Ross Paintings to Be Auctioned to Raise Money for Public TV Stations After Funding Cuts – CBS News
Views and Analysis
- Health Care Politics Bolster Democrats in Shutdown Fight – Catie Edmondson and Carl Hulse, New York Times
- What the Shutdown Is Really About – Ezra Klein and Neera Tanden, New York Times
- This Shutdown Is as Pointless as All the Others – Bloomberg Editorial Board
- Why the White House Might Dial Up the Shutdown Pain – Washington Post Editorial Board
- Russ Vought Is Going to Damage Trump Even More Than Elon Musk Did – Alex Shephard, American Prospect
- Will Air-Traffic Controllers End the Government Shutdown? – Jeff Wise, New York
- What Is the Price of Gold Telling Us? – Wall Street Journal Editorial Board
- The San Francisco Fed President's Case for More Rate Cuts – Courtenay Brown and Neil Irwin, Axios
- Medicare's Real Fiscal Crisis Is Much Worse than Trust Fund Insolvency – Romina Boccia and Ritvik Thakur, CATO Institute
- Can We Replace the Property Tax? – Jared Walczak, Kyle Hulehan, Dan Carvajal, Tax Foundation (podcast)
- Trump Labor Department Says His Immigration Raids Are Causing a Food Crisis – David Dayen, American Prospect