You’ve undoubtedly come across the words ‘default’, ‘shutdown’, ‘disaster’, on the news in the past month. Fire and brimstone aside, there is a serious risk of a shutdown if the House and Senate can’t agree on a government funding bill by midnight tonight. If this does in fact happen, the federal government will essentially shut down and many functions and services will be suspended.

What won’t happen: Just because the government is ‘shutdown’ does not mean that everything will cease to function. Social security checks will still get mailed out and veterans will not lose their hospital benefits. Also to make one thing clear, Obamacare will not be affected. The private insurance marketplaces will still open on time. In short, anything that falls into the category of permanent law (Social Security), national security, or public safety will continue to function.

What will happen: If the government does in fact shutdown many federal agencies will close their doors and employees will not be able to come in.  This does not mean that everyone who works for the federal government will have to go home. A specific set of laws and regulations will kick in once the shutdown commences. Employees fall into two categories: Essential and non-essential, where the essential workers continue operations on an IOU basis and the non-essential workers will stay home.

Why is this happening (again)?

The short answer is that Congress sucks. This congress in particular sucks and everyone knows it. However when it comes passing budgets, our great lawmakers drag their feet even more than usual. The process for passing a budget by September 30th has been the same for over 30 years. However since 1977 Congress has only met this deadline four times. Amazing right? In order to buy time and bicker a bit more about nonsensical issues Congress passes something called a ‘continuing resolution’ which really just means ‘we’re working on it’. But this year the hyper polarity is at critical mass and Congress can’t even decide on a continuing resolution. This means the shutdown is probably imminent. Also you can probably guess that in the past few years that Congress has had to pass more and more continuing resolutions before they finally agree. Graphically brinkmanship looks like this:

Does anyone win?

Matthew Yglesias (of Moneyboxhad an interesting take on his blog last week where he talked about the ‘Winners From a Government Shutdown’. Read it here.

Some of the winners include:

1. D.C. area rat population– while you might think that street cleaning is handled at the city level, the District government actually does not have much autonomy when it comes to spending. As a result many garbage collection and street cleaning services will be suspended.

2. D.C. area bar owners– All those non-essential employees I mentioned above will have quite a bit of free time meaning they will be looking to go out and sleep in.  According to Yglesias many bar owners had ‘shutdown specials’ in 2011 when we were facing a similar crisis.

3. Regulatory bandits– With regulators such as the EPA closing their doors it quickly becomes a ‘polluters paradise’.

4. Netflix– Same principle as the bar specials. When furloughed employees are quelling their hangovers they can catch up on Orange is the New Black or watch the latest Mike Birbiglia stand-up

While I only scratched the surface of the effects of the shutdown, you can read a lengthy piece here which even goes into the contingency plans for many agencies which will be affected starting midnight tonight.

Can this Congress get anything done? Can you defend the actions in Congress? Is the method for passing budgets (continuing resolutions included) just inefficient? 

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