Democrats and Republicans failed to reach a funding agreement on October 1st, leading to the US government shutdown, which has now passed one month. American people’s daily lives are becoming more and more sluggish.
According to data from the Bipartisan Policy Center, 73, 000 federal employees (32 percent of the workforce) have been without pay, while 670, 000 have been fired because government departments are unable to pay them. As the government departments become inoperable and the shutdown drags on, that number will increase.
A number of services, including essential food assistance, have been interrupted or even completely stopped as a result of the shutdown.
How long has the shutdown been in effect?
After Democrats refused to approve a spending bill supported by Republicans without important amendments that would restore funding for public health programs, US President Donald Trump threatened to launch massive federal layoffs in the weeks leading up to the shutdown in October.
The shutdown, which is now the second-longest in US history, was caused by neither side’s backs.
Government shutdowns have rarely occurred over the course of a few days, but they occasionally occur.
Trump’s first year as president of the United States was the shutdown’s last one. The longest in US history, lasting 35 days from December 22, 2018 to January 25, 2019, was despite only a partial shutdown. The conflict began with a row over the construction of a wall along Mexico’s border, and it only came to an end when Trump made a tentative agreement with congressional leaders to reopen the government for three weeks while negotiations raged.
The government has experienced 20 funding gaps, which have led to 10 shutdowns since 1976, the beginning of which was the process for establishing and approving government budgets.
What transpires during a shutdown, and what services are impacted?
Non-essential federal services like those offered by regulatory bodies and museums are temporarily suspended or reduced, and many government employees are furloughed and taken on unpaid leave.
Before funding is restored, essential personnel like military personnel, law enforcement personnel, air traffic controllers, and agents for the Federal Bureau of Investigation (FBI) and US Immigration and Customs Enforcement (ICE) must continue to work, frequently without compensation.
How many people are employed by the federal government?
The federal government employs more than two million people nationwide.
Just over seven percent (162, 489) of all federal workers are based in Washington, DC, followed by 6.7 percent (150, 679) in California, 6.5 percent (147, 358) in Virginia, 6.4 percent (144, 497) in Maryland and 5.8 percent (130, 686) in Texas.
The locations of 276 and 235 employees are not made public.
How many people work unpaid or furloughed?
The Bipartisan Policy Center’s most recent estimates indicate that about 730, 000 federal employees are paid untrained, and about 670, 000 have received furloughs.
97 percent of the Department of Veterans Affairs employees still carry out their duties. The majority of the department’s funding is being paid because it is not funded by annual appropriations, or Congress-approved budgets.
Secret Service agents, border control officers, airport security, Coast Guard workers, and emergency workers in disaster relief are among the department’s 271, 000 employees still employed, the majority of them without pay.
Law enforcement, FBI agents, criminal prosecutors, and prison guards are among the Department of Justice’s 115, 000 current employees, and 90% of them are still employed, largely without pay.
Conversely, 91% of its 4,300 employees are being laid off. Only those who continue to monitor markets and deal with urgent fraud problems work.
The Environmental Protection Agency’s 15, 000 employees have received furloughs, or about 89 percent. The work of security guards, criminal investigators, and emergency response personnel continues.
2,450 government employees at the Department of Education have been furloughed, or about 87 percent of them. Workers who still provide grants and student aid to schools are among those who are still employed.
What effects do federal programs experience?
Some vital government programs will completely lose funding when November 1st.
On October 10, the US Department of Agriculture (USDA) announced that it would not have enough funds to pay food benefits by the month’s end.
By the end of this week, the USDA will no longer have funding for the Supplemental Nutrition Assistance Program (SNAP). Food assistance is a necessity for more than 42 million Americans.
SNAP has access to a $5 billion contingency fund that could provide benefits for a few weeks; it costs the government $ 9.8 billion annually, or roughly $ 8.3 billion per month. However, Reuters claims that the USDA won’t use these for November-slated assistance that will expire.
The Trump administration has stated that it won’t fund the program with emergency funds.
The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC), which provides food, breastfeeding assistance, and education to more than six million pregnant women, young mothers, and children, is also in need of funding.
What will be the economic consequence?
The economy’s shutdown is typically temporary and has little to no impact. When a shutdown is over and funding is released, unpaid and furloughed employees’ pay is typically retroactive.
That doesn’t imply that it is insignificant. Contract workers are typically more negatively impacted than others because they only receive back pay from their contracting employers.
The Trump administration has also threatened to terminate workers altogether or not provide back pay, which would mean that the shutdown could have a bigger impact on the economy.
The Congressional Budget Office (CBO) estimates that the partial shutdown in 2018-19 slowed the growth of the country’s GDP by about 0.1 percent in the fourth quarter of 2018 ($3 billion) and by about 0.2% in the first quarter of 2019 ($8 billion). This was primarily due to delayed spending on goods and services as well as the loss of furloughed workers’ pay.
Since about $3 billion of these losses were not anticipated to be recovered, GDP is thought to be 0.2 percent lower than it would otherwise be in 2019.
Analysts predict that the shutdown will cut GDP by 0.1% to 0.2% for each week it lasts, which would be equivalent to about $15 billion per week.
The impact, according to economist Michael Feroli in a JPMorgan briefing note, “could be worse this time due to the looming layoffs and actual job losses, which could put a risk on both the labor market and consumer spending.”
