At the time of this article’s publication, the U.S. government is in a state of shutdown, and has been for almost a full week. While that may sound scary, and for many it is, the actual effects of a government shutdown are more specific than most might think. So with healthcare, government jobs, military paychecks and more on the line, one simple question is left in most Americans’ minds: “What does a government shutdown mean for me?”
One quick update, is that at the time of this article’s publication, in a massive breaking of convention the Trump Administration has stated that some federal employees do not “deserve” back pay, leaving thousands of workers unsure about if they will be receiving compensation for their furloughed time away.
How did it start?
Before we get into the effects of the shutdown, let’s briefly touch on the why of the whole situation. Congress is faced with the yearly task of passing an “appropriations” bill that dictates federal funding for a variety of government programs across the country.
When Congress is unable to come to a majority vote, which requires at least some level of bipartisan support, the bill is unable to be passed and federal funding is unable to be distributed to these aforementioned programs. This lack of funding distribution is the primary cause of a government shutdown, meaning the shutdown will continue to last until Congress can find majority support for a bill and unjam the flows of funding that are currently being withheld.
The reason that this year’s bill was unable to pass is that in a very divisive partisan split, almost every Democratic member of Congress voted against the proposed bill, with almost every Republican member of Congress voting in support, drawing a clear partisan line and making it impossible for a bipartisan majority vote to be garnered for the bill.
There are two main issues that caused such a wide partisan split on this bill. The first is whether or not this new bill will include an “extension” of multiple tax credit programs which if not extended would in some cases double the cost of health insurance for millions of Americans. The second is whether or not President Trump’s cuts to Medicaid will be upheld or reversed in the new budget.
The Democrats in congress are holding out for the extension, and for the reversal; Whereas the Republicans in congress want to discontinue the tax credit programs and uphold the cuts to Medicaid.
What are the immediate effects?
When the government shuts down certain organizations are hit harder than others. Museums and national monuments are most often the first to shut down, as many people who work at the sites are sent home without pay.
On top of this, federal workers stop receiving paychecks during the entire time the shutdown is in effect, with many essential workers being required to continue their jobs without pay. This leaves many government institutions either on leave or under smaller working staff.
What are the long term effects?
A prolonged shut down could have more harmful effects on the economy and institutions that would typically be able to maintain their services even during the first days of a shutdown. Many lower district courthouses could run out of reserves and have to temporarily close during a prolonged shutdown, significantly affecting the timeliness of court proceedings.
Government contractors could lose or regain backpay funding depending on how the organization they were contracted through decides to handle their payment once the shutdown is resolved. The longer a shutdown is in effect, the more these effects could be exasperated.
Economic data collection also stops during the duration of shutdown, which makes federal institutions like the Federal Reserve have to rely on outdated data and old estimates, which could have severe impacts on the economy if data collection is withheld in the long term.
How will it end?
The shutdown will only end if Congress is able to pass a version of the “appropriations” bill that is able to garner bipartisan support, something that could take as little as a few days or as long as a few weeks. As of the time of this article’s publication, the partisan split that caused the shutdown is still holding strong, and blame is being thrown in both directions by officials on both sides of the divide. There are no concrete estimates as to when this shutdown will end.
