Government Faces Potential Shutdown as House Republicans Demand Showdown over Federal Spending
The federal government is just days away from a potential shutdown that could have far-reaching consequences for various services, workers, and politics. House Republicans, driven by far-right demands, are forcing a showdown over federal spending, prompting concerns over the interruption of numerous services, the strain on workers, and political unrest.
While some government functions, such as Social Security benefit payments, will continue unaffected, many federal agencies will be forced to halt non-essential work. This means that millions of federal employees, including members of the armed forces, may not receive their paychecks during the closure.
A government shutdown occurs when Congress fails to approve legislation for funding, as promulgated by the president. Normally, lawmakers are expected to pass 12 different spending bills to fund various government agencies, but the process can be time-consuming. In such instances, temporary extensions, known as continuing resolutions (CR), are often approved to keep the government operational.
However, in the absence of enacted legislation, federal agencies are required to cease non-essential work and halt paychecks until the funding impasse is resolved. Essential personnel, such as air traffic controllers and law enforcement officers, are still required to report to work, but other federal employees are furloughed. According to a 2019 law, furloughed workers are typically retroactively paid once the funding issue is resolved.
The government’s funds are set to expire on October 1, which marks the start of the federal budget year. If Congress fails to approve a financing plan proposed by the president, the shutdown will effectively begin at 12:01 a.m. on Sunday. The duration of a government shutdown is uncertain, as the Democratic-controlled Senate and Republican-controlled House are pursuing different plans to avoid a closure, and House Speaker Kevin McCarthy is struggling to secure support from far-right conservatives to keep the government open.
The shutdown could potentially impact millions of federal workers, including around 2 million military personnel and over 2 million civilian workers nationwide. The Department of Defense, Veterans Affairs, and Homeland Security house nearly 60% of federal workers, while other federal agencies have employees stationed across all 50 states who interact directly with taxpayers.
Aside from federal workers, a government shutdown could have widespread effects on governmental services. People relying on government services, such as clinical trials, firearms permits, and passports, might face delays. Some federal offices may have to close or operate with reduced hours. Companies linked to the government, such as federal contractors and tourism services near national parks, could also experience disruptions and economic downturns. The American Travel Industry Association estimates potential losses of $140 million per day during a shutdown.
The financial markets could also be impacted, as Goldman Sachs projects a 0.2% reduction in economic growth per week of a government shutdown. However, economic growth is expected to rebound once the government reopens. Moreover, the disruption in essential government services may erode public confidence in the government’s ability to fulfill its basic duties. The US Chamber of Commerce emphasized that “a well-functioning economy requires a government that works.”
Despite a potential government shutdown, the cases handled by the judicial system will continue. The Supreme Court, which commences its new term on Monday, will not be affected due to its ability to draw on significant funds generated through court fees. The remainder of the federal judiciary will also continue operating for at least the first two weeks of October. However, each individual court will determine which activities can proceed during an extended shutdown. It is important to note that funding for special counsels, including those prosecuting former President Donald Trump and investigating Hunter Biden, will not be affected by a government shutdown.
Government shutdowns have been witnessed several times since the early 1980s. Prior to that, lapses in government funding did not result in significant shutdowns. However, legal opinions in the 1980s determined that government agencies cannot legally operate during a funding lapse. Since then, federal officials have recognized “essential” functions related to public safety and constitutional duties that may continue during a shutdown.
Ending a government shutdown requires Congress to fulfill its responsibility of funding the government. The House of Representatives and the Senate must agree on a funding plan, which the president must then sign into law. Currently, both sides remain divided and far from reaching an agreement. However, if the shutdown persists for weeks, pressure will mount to resolve the stalemate, particularly if active-duty military members fail to receive their pay on October 13 or November 1. Disruptions in air travel and border security could further encourage Congress to act.
Congress often relies on continuing resolutions to provide interim funding, keeping government offices open at current levels while budget negotiations take place. Funding for pressing national priorities may be included in temporary bills. However, hardline Republicans are unwilling to consider any interim measures and insist on negotiating the 12 bills that finance the government. Historically, this process is time-consuming and unlikely to be resolved before December at the earliest. Former President Trump, who is expected to contest President Joe Biden in the 2024 election, is urging hardline Republicans to maintain the government shutdown. If their demands are met, the shutdown could last for weeks or even longer.