Maloney: Trump Shutdown is Bad for the US Economy
WASHINGTON, DC – Congresswoman Carolyn B. Maloney (NY-12), House Ranking Member of the Joint Economic Committee and Ranking Member of the Subcommittee on Capital Markets, Securities, and Investment, released the following statement explain the economic consequences of the Trump Shutdown.
“If President Trump and Republican congressional leadership continue to refuse bipartisan compromises to reopen the federal government, it will not only continue to disrupt the lives of millions of Americans, it likely will have significant economic costs.
“Economists broadly agree that shutting down the government is likely to have a negative impact on GDP. The nonpartisan Bureau of Economic Analysis studied the 2013 Republican shutdown and found that it lowered real GDP growth by 0.3 percentage points on an annualized basis. Economic forecasters, including those at Moody’s, Standard and Poor’s, and Goldman Sachs, found that the 16-day shutdown in 2013 may have cost our economy $24 billion – about $1.5 billion per day.
“This shutdown will likely hurt consumer confidence and in turn, weaken spending. Consumers spend less so businesses sell less. Because consumer spending accounts for more than two-thirds of the U.S. economy, a loss of confidence could have a significant ripple effect. Confidence could be slow to recover. This shutdown is also likely to weaken business confidence, which could result in slower job growth. During the 2013 shutdown, business confidence fell to a seven-month low.
“This shutdown is directly impacting the hundreds of thousands of federal government employees who have been furloughed. In 2013, about 850,000 federal workers per day were affected, causing considerable stress on families. They eventually received back pay—for an estimated $2 billion for work not performed.
“In the past, our Republican colleagues have been cavalier about the likely effects of a government shutdown, perhaps hoping that the resulting chaos would weaken public confidence in Congress and the federal government and thus support their efforts to slash government spending. However, they are playing with fire, not only because our nation depends on faith in our democratic institutions, but because the economy depends on it as well.”