01 October 2013
US federal government shuts down
The U.S. government began a partial shutdown at midnight for the first time in 17 years, putting as many as 800,000 federal employees out of work today, closing national parks and halting some government services after Congress failed to break a partisan deadlock.
A partial federal government shutdown would cost the U.S. at least $300 million a day in lost economic output at the start, according to IHS Inc. (IHS) That's a fraction of the country's $15.7 trillion economy, and the impact is likely to grow over time as skittish consumers and businesses stay on the sidelines.
During the partial government shutdown, many essential government operations would cease. Internal Revenue Service call centers would close and more than 90 percent of Environmental Protection Agency workers would stay home. National parks and museums would be shuttered.
Other services continue uninterrupted. Social Security and Medicare benefits would be paid. U.S. troops would remain at their posts around the world and would get paid under a bill Obama signed yesterday. Air traffic controllers and airport security screeners would keep working.
Delaying Obamacare
Twice yesterday, the House voted to send a bill delaying Obamacare to the Senate. Twice, the Senate rejected the House's plans.
Debt Ceiling
Congress and Obama have been at loggerheads on fiscal policy since Republicans won control of the House. They took several disputes to the brink, including a potential government shutdown in April 2011, the debt ceiling in August 2011 and the expiration of tax cuts in December 2012.
In each case, lawmakers reached an agreement to prevent the worst possible outcome. Most recently, the House passed a tax bill Jan. 1, hours after income tax rate increases took effect.
Boehner and Majority Leader Eric Cantor tried to avoid this fight, offering a first proposal last month that would have let the Senate send a spending bill without conditions right to Obama.
They faced an uprising from Republicans, urged on by Senator Ted Cruz of Texas, who insisted on language that would defund Obamacare.
The House scaled back its demands twice, each time running into a party-line blockage from Senate Democrats and Obama, who increasingly saw the spending bill as a prelude to the debt-ceiling negotiations.
The House's latest volley, passed yesterday evening, would delay for one year the mandate that individuals purchase health insurance and would end government contributions to the health insurance of lawmakers, congressional staff members and political appointees.
Democrats see a quick path out of this crisis. They want Boehner to allow the House to vote on the Senate's version, which would extend government funding through Nov. 15 and exclude any Obamacare conditions.
Republicans said they want to force Obama to accept some concessions on his signature health care law.
Political Fallout
Some strategists expect the shutdown to drive both parties deeper into their respective fighting corners as they assess the economic and political fallout, hardening positions at least temporarily before any resolution can be reached.
A partial federal government shutdown would cost the U.S. at least $300 million a day in lost economic output at the start, according to IHS Inc. (IHS) That's a fraction of the country's $15.7 trillion economy, and the impact is likely to grow over time as skittish consumers and businesses stay on the sidelines.
During the partial government shutdown, many essential government operations would cease. Internal Revenue Service call centers would close and more than 90 percent of Environmental Protection Agency workers would stay home. National parks and museums would be shuttered.
Other services continue uninterrupted. Social Security and Medicare benefits would be paid. U.S. troops would remain at their posts around the world and would get paid under a bill Obama signed yesterday. Air traffic controllers and airport security screeners would keep working.
Delaying Obamacare
Twice yesterday, the House voted to send a bill delaying Obamacare to the Senate. Twice, the Senate rejected the House's plans.
Debt Ceiling
Congress and Obama have been at loggerheads on fiscal policy since Republicans won control of the House. They took several disputes to the brink, including a potential government shutdown in April 2011, the debt ceiling in August 2011 and the expiration of tax cuts in December 2012.
In each case, lawmakers reached an agreement to prevent the worst possible outcome. Most recently, the House passed a tax bill Jan. 1, hours after income tax rate increases took effect.
Boehner and Majority Leader Eric Cantor tried to avoid this fight, offering a first proposal last month that would have let the Senate send a spending bill without conditions right to Obama.
They faced an uprising from Republicans, urged on by Senator Ted Cruz of Texas, who insisted on language that would defund Obamacare.
The House scaled back its demands twice, each time running into a party-line blockage from Senate Democrats and Obama, who increasingly saw the spending bill as a prelude to the debt-ceiling negotiations.
The House's latest volley, passed yesterday evening, would delay for one year the mandate that individuals purchase health insurance and would end government contributions to the health insurance of lawmakers, congressional staff members and political appointees.
Democrats see a quick path out of this crisis. They want Boehner to allow the House to vote on the Senate's version, which would extend government funding through Nov. 15 and exclude any Obamacare conditions.
Republicans said they want to force Obama to accept some concessions on his signature health care law.
Political Fallout
Some strategists expect the shutdown to drive both parties deeper into their respective fighting corners as they assess the economic and political fallout, hardening positions at least temporarily before any resolution can be reached.
Labels: News
