House GOP pursuing two-step plan to avert government shutdown

(CNN) — House Republicans are pursuing a two-step plan for funding the government, three sources familiar with the matter told CNN, as Congress barrels toward another spending deadline next Friday.

Newly elected House Speaker Mike Johnson announced the plan on a GOP conference call with members Saturday afternoon and argued “I wasn’t the architect of the mess we are in,” according to a source on the call.

While Johnson embraced the right wing of his conference by pitching the two-step approach, he didn’t fully cave to their wishes. The package does not include the deep spending cuts that his right flank pushed for but instead extends funding at its current levels.

“This two-step continuing resolution is a necessary bill to place House Republicans in the best position to fight for conservative victories,” Johnson said in a statement Saturday.

Extend funding

The first bill would extend funding until Jan. 19 and would include military construction, Veterans Affairs, transportation and housing as well as the Energy Department. The second part of the bill, which would extend funding until February 2, would include funding for the rest of the government.

Neither bill includes additional aid for Israel or Ukraine.

The two-step approach was widely pushed by Republican hardliners but dismissed by many senators as a complicated solution that was hard to implement and execute. Still, given that funding for the agencies would stay at current levels, it could be harder for Democrats to reject.

Ahead of the conference call Saturday, Republicans had been weighing multiple options, including a more straightforward stopgap bill with some added sweeteners along with the more complicated two-step approach that Johnson is pitching.

The conference has been divided over which option to pursue, with appropriators in favor of a clean stopgap and members of the Freedom Caucus pushing the laddered approach.

Critics of the plan

Still, GOP Rep. Chip Roy, who is part of the far-right House Freedom Caucus, said on X that he is against Johnson’s plan because it does not have the deep spending cuts that the right wanted.

House Minority Leader Hakeem Jeffries previously slammed the prospect of a two-step continuing resolution as a nonstarter, calling it a ”right-wing joyride which would crash and burn the economy.”

If lawmakers fail to pass a spending plan by next Friday, many government operations will grind to a halt until Congress acts. Government functions that are deemed essential, however, will continue.

Each federal agency comes up with a contingency plan that outlines which of its functions will continue during a shutdown and which will stop, as well as how many of its employees will continue working and how many will be furloughed until the shutdown ends.

On a national scale, government shutdowns can have far-reaching economic consequences, hampering growth and promoting uncertainty, especially if they drag on. Some of these costs include raising the unemployment rate, lowering the growth in gross domestic product, and raising the cost of borrowing.