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Explained: Why the US government could shut down this week and what would happen

Explained: Why the US government could shut down this week and what would happen

Explained: Why the US government could shut down this week and what would happen
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By CNBCTV18.com Sept 28, 2021 10:26:47 PM IST (Updated)

Besides closure of non-essential federal services like museums and parks, the COVID fight will also suffer a setback as 62 percent of CDC staff will be affected by the shutdown.

The US government will go into a partial shutdown if the Congress is unable to appropriate funds for some federal agencies by the end of this week.

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Most federal agencies came to a grinding halt when their funds expired on September 23 midnight. On September 27, the Senate Republicans blocked an emergency spending Bill proposed by President Joe Biden’s Democrats that was aimed at averting shutdown of non-essential federal services and a federal debt default by October.
If left unaddressed, the deadlines could lead to furloughs for thousands of federal workers, destabilising the US economy in the middle of a health crisis.
Impact of shutdown
If the government fails to appropriate funds, non-essential federal services such as museums and parks will shut down, while essential services such as police and fire services will continue to operate, the Centre for a Responsible Federal Budget said. This could mean that three in five of the roughly 2.1 million federal employees would be forced to stop working, the Bipartisan Policy Center told Reuters. They would, however, continue to receive their salaries if the government reaches a spending agreement.
Also, agencies like the Small Business Administration and Federal Housing Administration will stop processing new loan applications when the agencies halt work. Research organisations such as the National Institutes of Health will also not issue new research grants or enrol patients in clinical studies, Forbes reported.
Fight against COVID-19 to take a backseat
About 62 percent staff at the US Centers for Disease Control (CDC), the agency which is central to COVID-19 pandemic relief efforts in the country, could be furloughed without pay during the pandemic. Many would continue to work without pay until the funding is approved.
"The agency is certainly going to be operating at lower efficiency," David Reich, a former congressional staffer, now at the Center on Budget and Policy Priorities think tank, told Reuters.
“The worst time in the world we want to shut down the government is in the middle of a pandemic where we have 140,000 people a day getting infected and 2,000 people a day dying. That's the time when you want the government working full blast to address this. I think that would have a profound effect on things if the government shuts down. So, it should be avoided, if at all possible,” top medical officer Dr Anthony Fauci told The Early last week.
What’s the way out?
The Congress needs to pass a spending Bill that will keep the federal agencies afloat through December. Senate Republicans blocked the Bill on September 27 as it included a provision to raise the cap on federal borrowing, citing concerns over heightened inflation.
The Democrats could drop the debt ceiling measure from the funding legislation and pass the Bill swiftly to avert a shutdown.
Similarly, the Republicans could also place a standalone continuing resolution without the debt limit provision this week, Senator Pat Toomey told CNN on September 26.
In 2019, the US had faced a similar government shutdown when about 800,000 workers went without work and pay for 35 days. The shutdown resulted in major delays in flights schedules.
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