The government of the United States is officially shut down.1 This is a scary and somewhat misleading statement, but let’s go through the steps of what it is, why it has happened, how it can be stopped, and how it will affect you.
The first and most obvious question we have to ask is what exactly is a government shutdown anyway? The US federal government operates on a fiscal year that goes from October 1 to September 30 of the next year. By the end of September 30, Congress is supposed to have a new budget out. In recent years, Congress has not met that deadline and used stopgaps to delay the budget making process without incurring a shutdown. This year, that process failed, but that’s an entirely different issue that we will not deal with here.2 All you have to know is that Congress is supposed to pass a budget by September 30, and this year they failed to do so. As a result, according to the Anti-deficiency Act of 1884, the government may not “make or authorize an expenditure or obligation exceeding an amount available in an appropriation or fund for the expenditure or obligation” or “involve either government in a contract or obligation for the payment of money before an appropriation is made unless authorized by law.” 3 In colloquial speak, that means that the government is not able to fund non-essential programs without having funds appropriated for them in a budget. No budget means that the government can’t spend money on things, even if it has the money to do so.
This means that the government as a whole shuts down because it’s illegal to use its money to fund government agencies. However, “essential agencies” are still open. That begs the question of which agencies and programs are being shut down? Essential agencies vital to national security, like the NSA, military, air traffic controllers, and the like, are all remaining open. Likewise, agencies that have their own independent source of funding, like the Postal Service and the Federal Reserve, remain open.4 However, most other agencies are being shut, and Federal employees are being “furloughed,” or being told to not come to work. Over 800,000 employees have been told to not show up, and are not being paid.5 NASA, the Federal Park Service, the Department of Veteran’s Affairs, the Centers for Disease Control (right in the middle of flu season, no less), the Environmental Protection Agency, the Commodity Futures Trading Commission (which regulates derivative markets), the Internal Revenue Service, and even half of the CIA, are all shutting down or drastically reducing their workforce (up to 97%, in the case of NASA).67891011121314
What does all of these agencies closing or drastically reducing their workforce temporarily mean? How does all of this affect you? The IRS won’t be performing audits or be able to help you file taxes over the phone. Veterans won’t be able to sign up to get new mental or physical health services. The CDC will have a much smaller ability to track flu outbreaks. Federal museums and parks are closed until further notice. If you want to get a new passport or buy a gun, you’re out of luck. And it may even delay one of NASA’s Mars rover launches for another 26 months due to the tight launch window for Martian rovers.15 Worst of all, having so many workers not receiving pay is bad for the overall economy. A shutdown of just a few days, which looks likely, could see overall US GDP in Q3-Q4 reduce by 0.3%, which is dozens of billions of dollars lost simply to governmental incompetence.16 If the shutdown lasts for longer, the consequences to the economy could be far more disastrous.
All of this seems very drastic and dire, so why in the world did it happen in the first place? What caused Congress to fail to agree on a budget this year? In one word: Obamacare. Already delayed countless times, Obamacare has been scheduled to begin coming into effect today, October 1, 2013, and indeed it has done so (the government shutdown does not affect the roll-out of Obamacame).17 Despite losing the initial voting, a Presidential election, and a Supreme Case fighting Obamacare, a significant radical minority in the Republican party viewed this budget battle as the last way they could successfully block Obamacare from happening. House Republicans, led by the likes of Ted Cruz, tied their version of the budget with an act that would entirely defund Obamacare, essentially making the law moot. The Senate rejected this budget on the basis that Obamacare, regardless of one’s objections to it, is an act signed into law by the President, widely supported by a majority of Americans, and upheld by the Supreme Court.18 Holding the government and indeed a nation hostage in an attempt to defund a law one does not like is simply no way to behave as a politician, at least in this lowly writer’s opinion. Regardless, the inability of both the Republicans and the Democrats to agree on funding the government with or without defunding Obamacare has caused this government shutdown.
The question now on everybody’s lips is what will it take to end the shutdown, and how long will it last? The longest shutdown ever lasted 21 days under Bill Clinton in 1995.19 It is virtually unimaginable that this shutdown will go on for any time longer than that. Anything more than a few days, really, would be highly unlikely, but still possible. What is needed to end this government shutdown is for Congress to simply do their jobs and pass a budget. The House Republicans and the Senate need to come to an agreement over what to do over Obamacare, which has been a law for years and is just coming into effect. That could take a while, given their general incompetence at governance. Perhaps this could be a wake-up call to the American people at the absurd partisanship and combativeness of the politicians in power. Or perhaps not. Regardless, the government is shutdown and will remain shutdown until our Congressmen can learn to compromise like adults.