How a Federal Government Shutdown Affects You

Here We Go Again.

News reports have been chattering about a possible government shutdown since July. Both Democrats and Republicans have been posturing and saber-rattling and making a lot of noise, but none of them bother to explain what that means for the public.

First, some background. Each federal fiscal, or budget, year begins on October 1 and ends on September 30. Fiscal year 2013 began on October 1, 2012 and ends on September 30, 2013. Fiscal year 2014 will begin on October 1, 2013. Federal law requires Congress and the president to agree on a final budget before each fiscal year begins. They couldn’t reach that agreement in 2012, so the United States government has been operating on a series of continuing resolutions since October 1. That means that the government can keep operating and paying its bills temporarily. When there is no funding, federal law requires the government to cease all non-emergency activities. The current resolution ends on Monday, September 30.

While it’s possible to operate on continuing resolutions, and without a real budget, indefinitely, it has been unlikely until now. The politicians usually make noise until one side or the other blinks. It appears that the Democrats have finally grown a spine and won’t give in this time.  But I could be wrong. Contrary to what many believe, the Constitution does not give all budgetary power to the House of Representatives or require budget bills to begin in the House. It doesn’t even require that Congress produce an annual budget. The Congressional Budget Act of 1974 does that, but not the Constitution.

Until we have a budget, the Republicans threaten to block new continuing resolutions and shut down the federal government unless the Democrats agree to eliminate all funding for the Affordable Care Act, also called Obamacare. President Obama has said that he will veto any bill which does that.

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How a Federal Government Shutdown Affects You

News reports have been chattering about a possible government shutdown since September. The demodupes and republithugs have been posturing and saber-rattling and making a lot of noise, but none of them bother to explain what that means for the public.

First, some background. Each federal fiscal, or budget, year begins on October 1 and ends on September 30. Fiscal year 2011 began on October 1, 2010. Congress and the president are supposed to agree on a final budget before each fiscal year begins. They couldn’t reach that agreement in 2010, so the United States government has been operating on a series of continuing resolutions since October 1. That means that the government can keep operating and paying its bills temporarily.  When there is no funding, federal law requires the government to cease all non-emergency activities. The current resolution ends on Friday, April 8.

While it’s theoretically possible to operate on continuing resolutions, and without a real budget, for an entire year, it is unlikely. The politicians will make noise until one side or the other blinks. Considering past performance, my bet is that the demodupes will once again roll over and appease the republithugs. Contrary to what many believe, the Constitution does not give all budgetary power to the House of Representatives or even require budget bills to begin in the House.  

Until we have a budget, the republithugs threaten to block new continuing resolutions and shut down the federal government. Forcing a shutdown is a political stunt intended to make the president look bad. It serves no financial purpose. It doesn’t save any money. In fact, it actually costs more money to shut down the government than to keep it running. I won’t go into the details, but you can read them here.  Former House Speaker Newt Gingrich and his merry band of republithugs shut down the government twice – from November 13 – 19, 1995 and December 16, 1995 to January 6, 1996.

Since 1980, the White House Office of Management and Budget has required all federal agencies to submit plans for operating in the event of a shutdown. Even the Congressional Research Service can’t determine how much of that planning is, or should be, available to the public. There are no clear-cut rules about what happens in a shutdown, but President Obama, as leader of the executive branch of the U.S. government, has the final word as to which activities stop and which continue.

So what does this mean for you? There is no easy answer to that question. Much of the answer rests with the problem of definitions, but the government will most likely follow the pattern set during the Gingrich shutdowns.

Federal spending falls into two broad categories – mandatory and discretionary. Federal staff positions are classified as essential and non-essential. Generally, essential personnel will remain on their jobs and mandatory spending continues.  

The following activities, and the employees who provide them, will continue to function and will be paid:

The president, White House executive office, members of Congress, and presidential appointees (upper-level cabinet officials, judges, ambassadors, etc.)

Personnel engaged in managing shutdown operations

National security, foreign relations, law enforcement and prisons

Public health and safety such as medical care of hospital inpatients and emergency departments, food and drug safety inspection services, and hazardous materials handling

Air traffic control and other transportation safety functions

Multi-year benefit programs such as Social Security, Veterans Disability, and federal pensions

Border and coastal protection

Protection of all federal property

Emergency and disaster assistance

Tax collecting and other functions which manage the banking and money systems

Public utilities and power distribution systems

Post offices and mail delivery. The U.S. Postal Service operates on its own revenue and doesn’t take money from the federal budget.

All employees not directly involved in those activities will be furloughed. Most will not be paid until the budget is resolved. 

The following activities, and the employees who provide them, will probably stop: 

Applications for student loans and grants, visas, passports, government employment, Social Security, Medicare, veterans’ benefits, and alcohol, tobacco, and firearms licenses will not be processed.

Routine trials and court activities will be curtailed.

Government contractors and suppliers will not be paid.

Federal parks, museums, libraries, and historic sites will be closed.

Custodial and maintenance functions at federal buildings and properties will stop.

Some activities fall into a grey area. Their fate is unclear.

Some military operations, such as national defense, are essential, but defense department spending is discretionary. So some military activities, but not all, will continue. We don’t yet know which will stop.

Public benefits programs such as TANF, SNAP (food stamps), WIC and other food assistance programs, Medicaid, and many others operate through state and local government employees. So they will continue to process applications. However, the federal budget funds those programs and benefits will most likely be suspended for the duration.

If you are a government employee, or rely on government services or programs, you can watch government websites for updates. The White House and OMB sites will contain general information. Each department and agency will post specific information on their sites. Look at USA.gov for links to every government department, agency, and office – federal, state, local, and tribal.

And contact your legislators. Tell them how you feel and what you want them to do.

For More Information

Congressional Research Service Report: Shutdown of the Federal Government: Causes, Processes, and Effects

Center on Budget and Policy Priorities: Introduction to the Federal Budget Process

White House Office of Management and Budget

Congressional Budget Office

President Obama’s 2012 budget proposal

Read the U.S. Constitution