Congress preview: debt ceiling, government funding and tax reform - Wells Fargo

Analysts from Wells Fargo, expect that the debt ceiling will be lifted before the projected September 29 deadline. They don’t expect major developments in the short-term regarding the tax reform. 

Key Quotes: 

“Congress returns from its August recess Tuesday, September 5 with a long to-do list of legislative deadlines, including lifting the debt ceiling, funding the government beyond the end of September, reauthorizing a number of federal programs and passing a budget resolution to serve as the vehicle for changes to tax law. For the House of Representatives, there are just 12 scheduled legislative days in September to accomplish the to-do list.”

“Our expectation is that the debt ceiling will be lifted before the projected September 29 deadline. Given the need for a bipartisan vote in the Senate to lift the borrowing limit, we expect the debt ceiling will be suspended for a period of time without being tied to budget cuts or other policy changes. The federal funding bill will also require bipartisan support and thus we expect Congress will enact a continuing resolution that maintains this fiscal year’s funding levels through the beginning/middle of December, buying policymakers more time to work toward a solution for the remainder of the fiscal year.”

“While tax reform discussions will be ongoing, we do not expect any major developments until late October or early November due to the numerous other pressing legislative priorities and the need to first pass a budget resolution.”