Capital Hill MPs are buckling for a long government shutdown, something that experts say that the economy may have a significant impact on the economy and pressurize President Trump to negotiate a deal with Democrats.
Economic experts say the shutdown will not have immediate effect on the economy, but they predict the impact on the GDP (GDP) that will add after a few weeks and may be more pronounced due to other economic headwinds, such as uncertainty created by Trump’s global trade war.
“If the shutdown is one or two weeks, which is not a big deal, it is not a very much comprehensive economic impact. … If it lasts for a month, six weeks, it becomes a big thing. Government services are interrupted, with the fact that government workers are not being paid, start harming,” said the chief economist of Mark Zandi.
“It also has some effect on financial markets. Global investors will be surprised about the nation’s rule and what this means to pay the loan on time, but it will be a month or more before that the damage is important to have a significant mechanism,” he said.
This is not clear, of course, whether the democrats would feel the most pressure to deal, or if it would be Republican and Trump.
So far, no side is concerned about taking heat.
Zandi said that “Forcing Mechanism” is most likely to put pressure on the Congress and Trump, to make a deal on October 15, when the army members will recall their first salary during Shutdown.
Around 2.8 million people work for the US Army, including 1.3 million active duty soldiers.
Zandi said, “I would be surprised that if the shutdown moves beyond that, at least to any important degree, because then our soldiers are not being paid, and I think it would be politically difficult,” Zandi said.
Both Democrats and Republican feel that they have strong public arguments that the other side is guilty of shutdown.
Republicans indicate the fact that the GOP-controlled house passed a “clean” funding bill that would expand the current expenses through 21 November. They accuse Democrats of voting for shutdown.
Democrats have argued that the health care premium will increase the decline as the Congress has not increased the increased subsidy under the Affordable Care Act. They want to cut the medicade which were applied as part of Trump’s “large, beautiful bill” in summer. They say that shutdown is about these health care issues.
The GOP has control of both the White House and the Congress chambers, so the Democrats also hope that the blame will fall on Trump and Republican as they are seen holding power. If there is a shutdown-inspired hiccup in the economy, the Democrats see Republican as the possibility of taking blame.
The Congress budget office estimated that the 35-day government shutdown at the end of 2018 and the GDP declined by 0.2 percent in the first quarter of 2019 in 2019. Economic impact, however, when the government opened back and federal employees received back payments and started spending again.
“A proper good rule of the thumb is that the government has shutdown every week, it is tenth of the annual GDP growth in the quarter. Low in a week, less in a week, in two weeks. Three, four, five, in five,” Zandi explained.
Trump and Republic leaders in the Congress say they plan to wait for the Democrat until they cave the cave.
The Senate majority leader John Thyun (RS.D.) has planned another vote on Friday, which is on the funding bill of the seven-week government-the Senate Democrats have already rejected it three times.
GOP strategists say that the themes will continue to bring the bill to the floor as long as eight democrats vote for it, vote 60 votes, it needs to be made at Trump’s desk.
So far, two Democrats and Sen Angus King (I-Men), who Caucas with Democrats, have voted for the GOP bill. Republican has lost one of its own in Sen Rand Paul (Q.).
A democratic option that has also been brought for votes, has not won any GOP support and has not lost votes from Democrats.
Ford O’Connell, a Republican strategist close to Trump White House, said, “Republican is going to continue sending those expenses bills, CRS, over -over, unless Democrats say yes.”
He argued that “the ball is not in Trump’s court”, recently pointing to a recent voters of 1,313 registered voters of the New York Times/Sienna College Pol, showing that 65 percent of the respondents said that the Democrats should not shut down the government, even if their demands are not met.
Nevertheless O’Conel admits that Trump’s goal is “to bring back the country on order to work”, but predicted that “Democrats are now going to learn about the ‘art of the deal’ and were earlier in Go-Around.”
Speaker Mike Johnson (R-La.) Has adopted the Thune plan and said that he will not bring an alternative funding bill on the house floor, telling reporters, “There is nothing that we can do to improve this bill for them,” referring to democrats.
A significant difference between the current shutdown and the past is that Russell Wout, director of Trump and Office of Management and Budget (OMB), has threatened to use shutdowns to permanently shut down thousands of federal employees.
In a call on Wednesday, Republican said that this week the federal workers are sorting.
Jerid Bernstein, former chairman of the US Economic Advisors under President Biden, said that the broad economic influence of the shutdown is “somewhat conditional whether they actually intend to temporarily set fire to federal activists.
He warned whether thousands of federal workers are permanently placed, “So you have a economic problem later.”
“You are increasing an existing problem, which the job market is already showing some cracks,” he said. “It will be very problematic.”
The parole processor, ADP, announced on Wednesday that the US economy lost 32,000 jobs in September.
The Labor Statistics Bureau reported last month that the economy produced only 22,000 jobs in August, and revised data showed that employment in June fell from 13,000 jobs.
“If it is a specific shutdown and lasts for a few weeks, any minimal economic damage is made very quickly. Whatever is longer than normal, it is a problem in two senses: one, people can only go for so long without a salary. Generally,” Generally, ”said Bernstein.
The Trump administration announced this week that it would freeze $ 18 billion in funding for infrastructure projects in New York City as it would be canceled $ 7.5 billion in the funding of Biden-age for hundreds of energy projects due to shutdown and mainly in states with Democratic-Performance.
Democratic strategist and former Senate leadership Rodel Molino said that Trump wants to punish Democrats and pressurize them to make a deal, but action may also be “pain for American citizens” and potentially backfire on Republican.
Washington Post Polls of 1,010 people released on Thursday revealed that 47 percent of respondents convicted Trump and Republican for shutdown, while 30 percent convicted Democrats in Congress and 23 percent uncertain.
Seriously, 50 percent of the independents surveyed by the pole convicted Trump and Republican for shutdown, while only 22 percent convict Democrats.
Gabenga Ajilore, the main economist at the Center for the institute of the institute, the institute of a left-handed research and policy priorities, said that the main issue with the shutdown is the impact on the federal workforce and the impact on the federal services, such as delays on airports due to federal aviation administration and transportation safety administration.
The US Airlines warned that flights will be delayed during the shutdown.
Ajilor said that the big question is that the administration will “prioritize” the obligations to shape the impact of the shutdown on the wider public.
Even before the shutdown, Zandi stated that the possibility of recession in the next 12 months was uncomfortable.
“The economy is going to be the weakest this quarter, in the next quarter, in the early 2026. If the tariffs and immigration and dogs are going to be a recession. [cuts] And other policy, then it is going to be here in the near future, in the next three, six, nine months, “he said.” A government is closed by itself, I do not think it is not going to do so until it continues for one or more time. ,
He also said that the end of the increased subsidy under the cheap care act can result in an increased “weight” on the health care premium, because losing subsidies in homes will pay more for insurance and “less consumers will be reduced. ,
But he warned that the economic impact of low health care subsidy would be included in Trump’s One Big Beautiful Bill Act with economic incentives such as corporate tax deductions, enacted in July.
