Sign posted in front of the Lincoln Memorial in Washington, D.C., Oct. 1, 2013. (AP/Carolyn Kaster)
The threat of a budget shutdown putting trillions of dollars of government spending in limbo has become almost an annual fixture in American government.
Democratic and Republican politicians divert attention from the business of governing to engage in political infighting and dogma in the week leading up to Oct. 1, when the new federal fiscal year begins.
The possibility of a government shutdown is growing more and more likely as House Republicans feud over a stopgap funding bill to keep the government running after the fiscal year ends on Sept. 30. The dispute between moderates and the hard right highlights the challenge before House Speaker Kevin McCarthy (R-Calif.), Washington Post reported.
Failure to pass a full-year spending bill or a stopgap has resulted in 14 federal government shutdowns since 1980. If Congress fails again, there could be another shutdown on Oct. 1.
Some federal agencies and programs that lack approved annual funding from Congress on Oct. 1 must stop all programs or activities not critical to national security or the protection of lives or property.
Not all parts of the federal government are affected by a shutdown. Major programs and benefits such as Social Security and Medicare are mostly unaffected because Congress has approved them to spend without an expiration date.
However, government shutdowns are expensive, bad for the economy and disruptive for scientific research, services for veterans and seniors, and health and safety inspections by FDA, FAA and NTSB, among others.
The Office of Management and Budget (OMB) estimated that the lost productivity of government workers in the 16-day 2013 shutdown cost the government $2 billion.
Mandatory spending makes up $7 of every $10 spent by the federal government, according to the Bipartisan Policy Center, a Washington, D.C. think tank that combines ideas from Republican and Democratic parties to address challenges such as national debt.
Jake Sherman, the co-founder of Punchbowl News, predicts an 80-percent-or-more chance there’ll be a government shutdown.
“I am extremely pessimistic that there is going to be some sort of deal that comes together,” Sherman told CNBC’s Squawk Box.
The impending potential shutdown of 2023 is different, Sherman said. This time, “there is no unifying thing that Republicans want that would get them out of the shutdown,” he said.
Many Republicans want border money and border policy and to secure the border, and this is one of Joe Biden’s biggest weaknesses right now, Sherman continued.
“If they actually wanted a deal on the border to get out of the shutdown, they could get one … there’s only a five-seat majority on the House of Representatives and there’s a large number of Republicans who want their way or the highway. So to the extent they could get a border deal, it’s not going to be acceptable to them. .. they can’t get out of their own way to get that done.”
Sherman predicts Rep. McCarthy will likely say that shutting down the government gives Biden the ability to look like an adult.
McCarthy knows Republicans will get blamed for a shutdown, and it’s hanging over his head that they could throw him out as speaker, Sherman said.
“If he takes a wrong step, they could schedule a vote on a snap referendum on McCarthy’s leadership. If Republicans shut down the government for an exptended period of time it is bad for them … it plays into all Joe Biden’s talking points that Republicans should not be trusted at the wheel of government.”
Even if the House does pass a short-term spending bill, the Democratic-controlled Senate is expected to reject it for leaving out key funding, Washington Post reported.
“GOP Rep. Tony Gonzales told me tonight: ‘I think we are headed towards a government shutdown with no end in sight'” tweeted Manu Raju, chief congressional correspondent at CNN and anchor of “Inside Politics with Manu Raju.”
The solution? Gonzales said, “What we have to do is to lock everyone in a room and nobody comes out until there is white smoke. Until we are willing to do that all we are doing is placing blame.”
