The United States has rejected 44 votes to end the government shutdown, causing economic deficits for federal employees and limited funding grants for research at the University of Rhode Island.
As the government shutdown enters week four, the House and Senate both need to pass a majority vote to end the shutdown which only the House has done, according to Leonard Lardaro, a professor of economics at URI. The senate’s eighth vote occurred on Thursday, ending with a 51-44 outcome. The senate needs 60 votes in order to pass.
Since the U.S. government shutdown began on Oct.1, 4,200 federal employees have been furloughed, or discharged from work, according to Liam Malloy, a URI economics professor. The only federal employees left are classified as essential workers. For URI, those employees are people who conduct research on campus. They come to work, but aren’t paid either.
To end a shutdown, Congress has to pass a continuing resolution or an eighth vote about funding the government, according to Malloy. It takes both the House and Senate to come to a settlement to re-open the government. If the eighth vote doesn’t pass, presumably, both parties will keep trying until they can reach an agreement.
“The longer it takes for bills to pass, the more economic negative impacts increase,” Lardaro said.
The federal government has canceled a large sum of spending, especially energy and transportation in democratic states, according to Malloy. This is part of the Republican party remaining politically sensitive around money. They reduce political costs by moving money around like paying the military, which is a controversial issue among both parties.
Indirectly, the shutdown impacts grant funding according to Lardaro. The government might impose research conditions such as cutting over a billion dollars like at Harvard University. Also, as access from research programs are closed, universities are unable to receive the money they need to complete research.
The main reason for the shutdown is the decision between both parties’ about whether the government should make changes to medical compensation, according to Lardaro. The dynamic of compensation is that the longer it goes, the higher the amount of medical bills people will receive. The amount of medical costs is above 50%, which could cause people to feel provoked.
The increase in workers who have been laid off is causing a ripple effect across the U.S., according to Lardaro. Restaurants who rely on employment will be understaffed and supply orders will decrease. The longer it goes on, the more dominant the issue.
When the government shuts down, it lasts as long as both parties feel the benefits outweigh the costs, which are usually political, according to Malloy. When people stop getting paid, there’s a lot of pressure to come to a compromise so employees can resume work and receive payment.
“Until [both parties] see it as hurting themselves, they won’t compromise,” Malloy said.
Even if the shutdown ended, it doesn’t mean the economy is set for good, according to Lardaro. The government will have to deal with Medicaid and backpay which could continue for months until they reach another debt ceiling. When that happens, they have to decide who finances the deficits.
“That’s the ironic part because eventually we’re going to have another budget crisis,” Lardaro said. “The big [beautiful] bill is adding a lot of deficits [to the economy].”
The one big question after a shutdown is if federal workers will receive missed paychecks, according to Malloy. In the 1990s, the Fair Labor Standards Act was passed where federal workers who were laid off receive back pay. However, the current administration said the federal workers may not receive it.
It would be devastating if federal workers didn’t receive back pay, according to Lardaro. If a worker was furloughed, the law states they would eventually get back pay. If the administration violates it, there will be court tests because the government can’t mass fire agencies. Depending on the impact, the case could go to the Supreme Court.
“Congress needs to do its job and the president needs to do his job.” Malloy said. “The federal government does important things and we shouldn’t mess around with [them].”
