Think a possible U.S. government shutdown is only bad news for federal workers? Think again. It could be a dramatic blow for the economy and lead to many private sector workers being shoved out the door.
Congress continues to be held hostage by those putting corporate interests above hard-working Americans and cannot reach consensus on a plan to fund the government going forward. As a result, the government could shutter beginning Oct. 1 and workers would feel the pinch in short- and long-term ways.
The immediate impact would be on millions of people whose jobs rely on the government operating. Those working for government contractors or suppliers would be hit first and would not be paid as long as the shutdown continues. But the reach goes well beyond them.
Economists made clear during a Sept. 24 Senate Budget Committee hearing that closing down the U.S. government, even for a short time, will hurt workers and the lingering effects would be significant for months if not years.
Mark Zandi, chief economist and co-founder of Moody’s Analytics, said political uncertainty related to ongoing sequester budget cuts has already stifled job creation even though companies are more profitable than ever. Add to that a three-to-four-week shutdown and you would have “significant economic damage” that could cause workers in many sectors to lose their jobs, he said.
Committee Chairwoman Patty Murray (D-Wash.) urged her colleagues to get to work and fix not only the immediate budget issues, but also the problems with sequestration cuts that uniformly and dramatically slash federal spending and put the nation’s middle-class workers and their families at risk.
“It really should go without saying, but instead of making it harder for families to find work, pay off their debts, send their children to school, to do the things that strengthen our economy now and over the long term, we should be doing everything we can to encourage continued and stronger growth,” she said.
But nearly lost in all of this debate is the colossal waste of time and resources lawmakers have invested into these discussions. While U.S. workers continue to struggle in the wake of the Great Recession and nearly 22 million people are unemployed or underemployed, elected officials are engaging in political posturing that jeopardizes even more jobs instead of trying to find solutions to get people back to work.
Beyond the short-term solution for averting a government shutdown, there needs to be a revelation across party lines that sequestration cuts are not a sustainable path that helps middle-class families. Even the bipartisan group Fix the Debt admits such a plan is not a good fix.
“There is widespread agreement that sequestration is not the optimal approach to deficit reduction,” the group wrote in a blog. “It front-loads cuts in the short term while the economy is trying to recover, as opposed to phasing in gradually over a longer period of time.”
Instead of finding solutions to the nation’s economic woes, however, sequester supporter Sen. Ted Cruz (R-Texas) spent more than 21 hours this week engaging in a quasi-filibuster and reading Dr. Seuss’ “Green Eggs and Ham” while the clock continued ticking towards a shuttering of the government.
Workers have a role to play in the coming days. Congress will first be debating solutions to keep the federal government up and running, followed by broader solutions to budgetary problems. Sequestration is widely seen by many as a failure. Lawmakers can’t be allowed to take the easy way out at the cost of the workers they represent who are being cheated out of the creation of better jobs.
Sen. Tammy Baldwin (D-Wis.) said during the Senate Budget Committee hearing there is a real need to give regular people a hand. “So many are working two jobs,” she said. “It’s incredible grit that I’m seeing. And I wanted to come here and see us in the Congress match that grit with a commitment to get out of these situations, like the one that’s unfolding right now.”