Behind the Veil of Continuing Resolutions in the Government

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It’s only been two years since the last time the U.S. government officially closed its doors for an extended period of time, but the possibility of it happening yet again still looms.

Lawmakers narrowly avoided a closure this week, but the questions, concerns, arguments and possibilities are only being kicked down the road another two months.

The situation got murkier earlier this summer when videos surfaced of Planned Parenthood officials apparently casually discussing what they should do with remaining fetal tissues. While the officials have since apologized for their tone and heavily denied that any such illegal discussion took place, the issue is now front and center. Republicans are looking to strip the organization of $528 million in federal funds.

There weren’t enough votes in Congress for that to happen at this moment, so along with other factors still being debated, the result was a “continuing resolution” — a short-term funding bill — that was passed before the end of the government fiscal year on Wednesday.

Lawmakers now have until December 11 to come up with a long-term spending bill, so the possibility of a government shutdown is still on the table.

In fact, Minority Whip Steny Hoyer has said he is worried that fights over spending caps (Democrats are calling for increased domestic spending to match any additional spending allotted for the Pentagon), the funding (or defunding) of Planned Parenthood and government funding in general could lead to a shutdown in December.

But here’s the thing. I’m not afraid of a government shutdown. It’s time to stop hiding behind cowardly continuing resolutions.

It’s the prime moment to finally take a stand.

Yes, a government shutdown could pressure the market, but I think investors are knowledgeable enough to avoid selling all of their investments just because the folks on Capitol Hill can’t get their act together.

The U.S. government has shut down 18 times before, and the world didn’t end on any of those occasions. If it shuts down again in December, I doubt we’ll see the world end then, either.

Continuing resolutions are a cowardly way to ignore the issues that fester and become even more problematic over time. It’s more important to face those issues head on rather than simply kick the can down the street. And this is exactly why there is subdued confidence in America right now.

As you can see below, a June Gallup pool recently showed just how low that confidence is. As measured by “a great deal” and “quite a lot” in terms of confidence, all three branches of the government ranked poorly — the Executive branch at 33%, the Judicial branch at 32% and the Legislative branch at just 8%.

Congress as a whole came in at the bottom of the list.

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The fact of the matter is simply this: Our government is bloated and controlled by special interests. It’s forgotten about our nation as a whole and lawmakers have mastered the art of being re-elected by bringing home the bacon, even as our national debt level has soared past our annual gross domestic product (GDP).

Looking ahead, I believe this is what the 2016 Presidential Election is going to be all about. And it could be the ultimate moment of truth. How much more debt can we accumulate before reaching an inflation point of no return?

Moreover, how much longer will households that have made enormous sacrifices, including a reduced paycheck, accept reckless spending by the people elected to protect the nation?

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Article printed from InvestorPlace Media, https://investorplace.com/2015/10/behind-the-veil-of-continuing-resolutions-in-the-government/.

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