It finally happened. Congress couldn’t agree on a budget in time, and now the government shut down is in effect. Some of you reading this may feel frightened, others may salivating at the thought of pure sweet anarchy. Either way, if you’re an American citizen you probably have a lot of questions about what a government shut down is and what it actually means. Don’t fret, ROI-Zone is here to help quell your fears and answer your biggest questions.
Why is the government even arguing about a budget in October? Shouldn’t this shut down have happened on January 1st or something?
The timing of the shutdown may seem strange to the majority of us, but it makes perfect sense to people who work for Uncle Sam. You see, the government’s fiscal year doesn’t follow the usual year marks we’re used to. For reasons no one really understands, the government’s fiscal year starts on October 1st and ends on September 30th. Usually the government has a yearly budget ready to go by the end of September, but that didn’t happen this year.
Wait a minute, if this is about a budget why is everybody screaming about Obamacare?
This is where it gets confusing. Essentially Republicans are very upset about certain stipulations in the Patient Protection and Affordable Care Act (the real non-partisan name for the health care law). Since the law requires that employers provide health insurance to their employees, the GOP believes that it’ll hurt small business owners and that the government shouldn’t be involved in how private businesses choose to handle insuring their employees.
The Patient Protection and Affordable Care Act pretty much has nothing to do with the budget, but because of political ideologies Republicans chose to incorporate their demands into the budgets they came up with. House Republicans insist that any new spending bill should include provisions to either make changes to the Patient Protection and Affordable Care Act, de-fund it, or take it away completely.
How did this become such a bizarre mess?
Essentially the House of Representatives is controlled by republicans and the Senate is controlled by democrats. Republicans would pass something in the house, democrats would deny it in the senate, and the whole thing repeats over and over again. Both sides refused to budge on certain issues, and also failed to reach a compromise.
What happened over the past few days?
On Sunday morning the House passed two spending bills, one would delay the Patient Protection and Affordable Care Act for a year, and another would repeal the plan’s medical device tax. When the bills went to Senate on Monday they were rejected, which caused the House to approve another spending plan that would remove the individual mandate clause of the Patient Protection and Affordable Care Act. The Senate also rejected that plan. Both the House and the Senate failed to reach an agreement before the midnight deadline that day, and as a result the government shutdown went into effect at midnight on October 1st.
What happens now?
The Senate will meet again and probably decide if they want to negotiate with the House. Senate majority leader Harry Reid said he wouldn’t consider meeting until the House strips the Patient Protection and Affordable Care Act amendments from the spending bill, so don’t expect a fast resolution.
OMG has this ever happened before?!
In before times in the long long ago in the ancient and mystical year of 1995, the federal government experienced a shutdown. While Americans were enjoying TGIF and guzzling Fruitopia, democratic President Bill Clinton and the republican controlled Congress clashed over funding for Medicare, education, public health, and environmental programs. The government was shut down after Clinton vetoed the spending bill Congress sent him, and non-essential government workers were put on a furlough while non-essential government services were suspended. The shut down occurred from November 14 through November 19, 1995 and from December 16, 1995 to January 6, 1996, culminating to 28 days of government chaos.
So, who gets kicked out of their office?
Out of 3.3 million workers the government employs, only about 800,000 employees will be temporarily out of work. Most of the furloughed federal workers were supposed to be out of their offices four hours after the official start of the business day on October 1st.
How is this going to affect the economy?
Depending on who you’re talking to, it’ll either barely have an affect or it’ll completely bring us to financial ruin. Most economists do agree that the affect it’ll have on the economy depends on how long it goes on for. Brain Kessler, an economist with Moody’s Analytics, estimates that a 3-4 week shut down could cost the economy about $55 billion.
Is this going to affect me?
That kind of depends. National zoos, parks, and monuments will be shut down (there were a lot of confused and angry tourists at the Statue of Liberty Tuesday). Last time the shutdown occurred over 200,000 applications for passports went unprocessed, but according to the State Department that won’t happen this time. Social security recipients will still be receiving benefits, but people who are looking for federal money through loans will have to wait. The garbage men will still pick up your trash, but not if you live in DC since they currently don’t have a budget since that also must be approved by Congress. So the answer is, yes?