repaid even furloughed workers what they would have earned had the shutdown not happened.
This repayment, essentially increasing the size of their first post-shutdown paychecks, had significant and immediate effects on household spending. Sudden spikes in spending occurred in the days after the paychecks were disbursed, largely erasing some of the most dramatic declines in spending during the previous two weeks.
The government has usually paid all its employees, “essential” or not, back pay after other past shutdowns, such as those in the 1990s. While Congress is legally required to pay federal employees who worked during the shutdown, there’s no law requiring the same treatment for nonessential workers.
In addition, the longer the shutdown lasts, the worse its impact. Households might deplete savings or hit their credit card limits as the impasse stretches day after day, giving them additional time to adjust their spending in ways that they could not do with only a few days’ notice. For instance, in 2013, bills for health insurance or tuition payments were largely unaffected. Had that shutdown persisted, households may have started to cut back here as well.
So if Congress refuses to offer furloughed workers back pay and the shutdown lasts weeks rather than days, the economic impact could be severe. However, if a shutdown is resolved in a relatively short amount of time, with workers being paid back their regular income, the damage would likely be fairly contained.
The third federal government shutdown of Donald Trump's presidency began when a temporary measure to keep the funds flowing at current levels through Feb. 8 collapsed President Trump said he won’t sign a Senate-approved short-term funding bill because it doesn’t contain money for a wall along the nation’s southern border. The bill’s failure boosted the chances of a government shutdown.
The Office of Management and Budget posted instructions for those federal agencies that could be impacted by what they call a “possible lapse in appropriations from December 22, 2018.” Six of the federal departments, including Defense, already have had their budgets approved and were not impacted.
But nine other departments and dozens of agencies have been operating under a short-term spending plan that expired at 11:59 p.m. Friday. Funding for those departments will lapse unless Congress approves their budgets or provides another short-term extension. The partial shutdown means that all but essential operations in those departments will be closed and some 800,000 federal employees will be furloughed or forced to work without pay until the standoff is resolved.
The Departments impacted were Agriculture, Commerce, Justice, Homeland Security, Interior, State, Transportation, Treasury and Housing and Urban Development, as well as several smaller agencies.
State and local farm service centers operated by the Agriculture Department would close, which means that no staff would be available to answer questions or assist farmers in signing up for new programs under the Farm Bill recently approved by
Congress, according to a memo prepared by Democrats on the Senate Appropriations Committee.
National parks could possibly close or offer just limited services. During a shutdown last January, gates at national parks remained open for people to enter but few staff was on hand to protect visitors and park resources. Buildings, such as visitor centers, were shuttered, and sometimes that included restrooms, according to the National Parks Conservation Association.
More than 30 million small businesses would no longer have access to federally assisted loans and technical assistance since Small Business Administration guarantees to back loans would freeze. Americans looking to buy a new home or refinance a mortgage insured by the Federal House Administration would be put on standby. Civil litigation, payments to victims and training for state and local law enforcement would stop during a shutdown.
How will federal workers be affected?
More than 420,000 federal workers who provide essential services will be forced to work without pay, according to Democrats’ memo. That includes 41,000 federal law enforcement and corrections officers, such as prisons officials, FBI agents, U.S. marshals and Drug Enforcement Administration workers. Also affected will be most customs and border patrol agents, Coast Guard employees, Transportation Security Administration officials, federal firefighters and weather service forecasters.
Another 380,000 federal workers will be furloughed, including most of workers at Commerce, NASA, the National Park Service, the Forest Service and Housing and Urban Development. Roughly a third of federal transportation workers will be furloughed, as will some 52,000 Internal Revenue Service workers.
What won’t be affected?
The mail. The Postal Service is an independent agency and won't be impacted in any government shutdown.
Travel. Air-traffic controllers still will be on the job and customs and border agents will continue working at border crossings. Amtrak, a government-owned corporation, also will operate as usual.
Social Security checks. Social Security benefits still go out, as will Medicare services and benefits from programs such as the Supplemental Nutritional Assistance Program and Women, Infants and Children for at least as long as some carryover money in the states or the federal accounts are available.
Congress has two jobs to do: pass a budget and pay its bills. Congress failed to fulfill its responsibility to pass a budget and as a result, much of the Federal government was shut down. An overview of some of the government services and operations that were impacted until Congress passes a budget to fund them again.
Vital services that ensure seniors and young children have access to healthy food and meals may not have sufficient Federal funds to serve all beneficiaries in an extended lapse.
Call centers, hotlines and regional offices that help veterans understand their benefits will close to the public.
Veterans’ compensation, pension, education and other benefits could be cut off in the case of an extended shutdown.
Every one of America’s national parks and monuments, from Yosemite to the Smithsonian to the Statue of Liberty, was immediately closed.
New and unprocessed applications for small business loans and loan guarantees were immediately halted.
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