How we doing hard-chargers!!
Today we’ll discuss a situation we’ve all heard about the last few weeks, and that is the Governmental shut-down.
The United States government is on the brink of a shutdown as we all know. I’ll try my best to give you a better understanding of this fiasco.
There are groups of individuals in the House of representatives (Republicans) who have passed a stopgap measure that would fund the US government for four weeks, known as a continuing resolution, or CR.
President Donald J. Trump will support the measure.
The Republicans now need the backing of some Democrats for the bill to pass the Senate by midnight on Friday, when funding for the US government runs out.
This disagreement could cause the shut-down – a costly political move for either party – comes after the collapse of bipartisan talks on a US spending bill. Which hinged on continued protections under the DACA programme for undocumented immigrants, which Democrats support.
With less than 24 hours left for tactics, the shut-down appears very possible. People seem to forget that the last shutdown was in 2013 and lasted 16 days.
What will be the impact of shut-down?
The direct impact, would be an immediate loss of productivity from about 700,000 government employees deemed “nonessential”. That’s very unsettling in the eyes of governmental employees.
These workers will be furloughed, meaning they will be put on leave until the government resumes functioning but for how long???
While there is no guarantee government workers will be paid for this leave, historically they have been paid retroactively in the case of a shutdown.
It’s been estimated that even if they are paid, the US government will experience lost productivity from almost a million people.
Who will be affected?
National parks, museums and monuments will shut down, as well as the processing of passports and visas, if the shut-down continues beyond a few days.
This will impact tourism. National parks in the west and the Smithsonian Institute museums in the east will not be open to the public
Another indirect loss will be to contractors – government employees are not the only ones waiting for a paycheck from Uncle Sam.
Over $43 billion has been awarded in contracts for the fiscal year 2018, according to government figures. None of this money will be paid as long as the shut-down continues.
That will remove a fair amount of money from the pockets of private citizens throughout the country. Some even suggest retail sales will drop, It’s no longer considered the holiday season but holidays sales continue into January.
Government services that will continue?
Those related to national security and domestic safety, including the military, law enforcement and air traffic control.
Certain entitlements, such as hospitals for veterans administered by the government and food stamps for families in need, would be unaffected.
Federal courts, where the Trump administration is currently battling an order to undo his decision to end the DACA programme, will continue but are subject to disruption.
Timeframe of shut-down?
In the case of the 16-day 2013 shutdown, Republicans and Democrats were at odds over funding then-President Obama’s landmark healthcare law, known as Obamacare. Which was the debt ceiling, for the US which allows the US Treasury to continue borrowing to pay debts.
There was a 27-day shutdown from December 1995 to January 1996, resulting from a clash between Republicans and Democrats over funding a health insurance programme for the elderly. That came a month after a November shut-down that lasted four days.
Before these examples, shut-downs were seldom.
The US government typically only experienced funding gaps over the weekend, not impacting the economy in any major way.
Will US economy be hurt by shut-down?
The 2013 shut-down cost the US economy $24 billion, according to estimates from S&P. While costly, GDP was over $16 trillion that year.
The firm estimates a shut-down would cost the US economy about $6 billion per week in 2018.
Any losses this early in the fiscal year could be regained later.
There are those who are hopeful feeling that the shut-down is not likely.
People think the government will come to its senses. As they understand it’s pretty touch and go right now in Washington, however, it doesn’t seem like a shutdown is in the government’s interests.
Only time will tell, however, as far as the military, speaking in terms of active, reserve and veterans. If this does actually happen you will not be affected. I repeat you will not be affected.
Lets hope they can come to an agreement in order to prevent this from happening for the others that possibly will be affected.
Isaac J. Hall II