Shutdown Will Be Worse for Economy Than First Thought, White House Says

https://www.npr.org/2019/01/16/685845545/shutdown-will-be-worse-for-economy-than-first-thought-white-house-says

by craftyguy • 8 years ago

78 151 8 years ago

npr.org

matte_black• 8 years ago

How are the shutdown’s effects on the economy being measured? Where did they come up with 0.1% loss every 2 weeks?

ams6110• 8 years ago

Good question. As will all previous shutdowns, I have not noticed any impact whatsoever.

ceejayoz• 8 years ago

I'm curious about what indicators in your personal life you'd use to judge the difference between a country-level 2.7 and 2.8% GDP growth rate for the year.

guidedlight• 8 years ago

There has been no guarantee of back pay for furloughed workers.

This is also the first shutdown where military servicemen have not been paid.

BucketSort• 8 years ago

Using yourself as a measure of these things is a horrible idea. Most impact is long term and not immediate to our personal lives. These shenanigans are deteriorating people's faith in the government and the country. This will have incredible consequences. Society runs smoothly when people feel their government is taking care of things. When people have reason to doubt their government, it naturally instills a sense of panic and self-preservation which I would expect hurts the economy in many subtle ways.

SolaceQuantum6• 8 years ago

I noticed the shutdown of last year. In particular, my advisor(I was a doctorate student at the time) was informed he won a significant award by the NSF with guaranteed funding and was unable to recieve it until two months or so after the shutdown. (As a side note we were also disrupted by the immigration ban, and were unable to bring on excellent scholars to pursue research at our facility.)

I'm no longer in research, but of my companions who are, this is definitely being felt.

jedberg3• 8 years ago

The impact at this point is mostly on government workers and the poor. I assume you're lucky enough not to be in one of those groups.

Most of the effects aren't immediate. The government does a lot of long term work, things that wouldn't otherwise be profitable. For example, with the shutdown, they've stopped inspecting our food supply. This will affect no one immediately. But in a few weeks, when we have our first e.coli outbreak, assuming we even hear about it (because that's something the CDC, another government org, tracks) then you can talk to those people about how it affected them, assuming they haven't died.

The government is currently missing their training and drills for hurricane preparedness. So in June-October, when a hurricane devastates some part of the US and everyone is screaming, "why aren't they helping people!?", the answer will be, "because they didn't get their training in January".

And right now NOAA isn't doing their climate research. So in 10 years, when there is a hole in the data that we need to fill out climate models, they won't be there. And no one will even remember why.

But no one thinks long term like that.

zorpner• 8 years ago

This federal employee has to choose whether or not to use her small amount of remaining insulin: https://www.nbcnews.com/news/us-news/federal-worker-forced-r...

Her blood sugar rose to a high level last week, but she said she felt forced to ignore it. Instead, she went to bed.

“When it gets that high you can go into diabetic ketoacidosis, you can go into a coma,” she said. “I can’t afford to go to the ER. I can’t afford anything. I just went to bed and hoped I’d wake up.”

theplague42• 8 years ago

The original estimate that the partial shutdown would subtract 0.1 percentage point from growth every two weeks has now been doubled to a 0.1 percentage point subtraction every week, according to an official who asked not to be named.
The administration had initially counted just the impact from the 800,000 federal workers not receiving their paychecks. But they now believe the impact doubles, due to greater losses from private contractors also out of work and other government spending and functions that won't occur.

https://www.cnbc.com/2019/01/15/source-white-house-believes-...

the_mitsuhiko• 8 years ago

I presume extrapolation from a million of people not receiving paychecks. I assume it's not too different from how you normally estimate GDP.

gniv• 8 years ago

I was curious too, and I found this paper discussing the effects of a 2.5 week shutdown in 2013: https://apps.dtic.mil/dtic/tr/fulltext/u2/a589972.pdf

(8 pages, I haven't read it all yet, but does seem to have some insights).

x0054• 8 years ago

It’s not about the wall being immoral. It’s about it being monumentally stupid and a waste of money. There are much better solutions.

baron816• 8 years ago

I think the more important thing is to keep a single branch from using a shutdown as a tool to get their way. Government via hostage taking is not democratic.

sigfubar• 8 years ago

Both branches of the government are holding the country hostage.

adwf• 8 years ago

Exactly. If the president vetoes everything unless he gets his way, then you might as well get rid of the other branches of government entirely and have him write/pass all the bills himself.

Otherwise known as a dictatorship.

eumenides1• 8 years ago

I actually think Government via hostage taking is fine. The Government won't be hurt in the end, it is a non-corporeal entity. The people who work for the government won't be fine.

What I think needs to happen is that the hostage takers have to be brought to justice or made to pay for utilizing such tactics. I think the hardest part is that the people have to remember this transgression at a personal level.

jasonlotito3• 8 years ago

Not just one branch, but one part of the branch: The Senate. The ball is literally in their court. McConnell already passed the bill. He voted for it. That he's not voting on it again is shameful.

masonic9• 8 years ago

Does that apply to the shutdowns under Obama and Clinton?

manfredo4• 8 years ago

Granted, the other way of thinking about it is that spending 5 billion on the wall is a lot less expensive than continuing the shutdown.

shereadsthenews2• 8 years ago

Negotiating with hostage takers never makes sense.

murph-almighty2• 8 years ago

We could have also spent 1.7 billion on other forms of security instead!

SolaceQuantum6• 8 years ago

IIRC money has already been offered to boosting border security and have been turned down explicitly in desire to a wall. This is an uncomfortable situation that my first impression is to see it as a hostage situation, but I try to avoid such extreme descriptions.

I'm struggling to find other, more neutral depictions of the situation, though.

omegaworks3• 8 years ago

Senate Democrats asked for a report justifying the $5b after they had already passed a bill allocating $1.6b. What they got was an outdated report for the $1.6b.

There's no way $5b will be the end of it. We're talking about a wall along a 2000 mile long imaginary line. A wall dividing a literal continent.

pavlov• 8 years ago

Also, the $5B number that Trump is hung up on seems to be completely arbitrary. Every estimate — including by the White House — suggests that any border wall even close to serving its stated purpose would cost at least $20 billion, probably way more.

drak0n1c• 8 years ago

The plan is to build in increments, starting with the areas that see the most traffic.

jfengel• 8 years ago

Ah, but the question is, are you willing to stand up for that fact, at the total cost of the economy, as well as the individuals directly affected? There is a person with a literal veto who believes that the wall is a good thing, and who seems resistant to persuasion. How long are you willing to risk damaging the economy before you give in to that person?

At this point, it's not really about just how bad or good an idea it is. (And, of course, I agree with you that it's a monumentally bad idea.) It's about perception: how much suffering you can stand (and stand to watch), and how much you're willing to risk being perceived as causing that suffering by failing to knuckle under.

Also take into account the fact that this unpersuadable veto-holder seems to genuinely enjoy watching that suffering, and that his supporters appear to agree with him on that.

In terms of the facts, the choices seem fairly obvious. But our choices are often made primarily not on the facts at hand, but the fact that people disagree despite that.

CodeSheikh• 8 years ago

Spend that money on increasing border patrol personnel, give them pay raises, ask American companies to make cheap drones and give them tax breaks, install motion based security systems. That $5B is going to get a 100 mile worth long wall which is not going to solve the "BIGGER" problem. Trump is a builder and he thinks like one. Sometimes concrete is not the solution.

thatoneuser8• 8 years ago

Why do you think it will be a waste of money? What are the better solutions?

Walls are typically effective, hence their ubiquity. I have yet to see a counter proposal that would guarantee the long term security in implementation (read: something the next president can't just come in and yank out) that a wall provides.

I'm not a fan of the wall, but it seems to me to be more effective than what most people give it credit.

acchow• 8 years ago

Aren't most "illegal immigrants" crossing the border legally (such as entering as a tourist) and then just never leaving?

matt40772• 8 years ago

First of all, the problem as such does not exist: illegal border crossings are at there lowest in decades, and what remains is a stream of young, eager people as easily integrated into the economy as previous generations of (Irish/Italian/Jewish/etc) immigrants.

And even if, serious conservatives point at far better uses for the money, such as shoring up the system of immigration judges.

dragontamer9• 8 years ago

Walls are typically effective, hence their ubiquity.

What is this? The middle ages?

Drug Dealers are buying drones for $1000 to smuggle cocaine into our country by air. 1-kilo of Cocaine makes $20,000 once it crosses the boarder, they can certainly afford $1000 drones.

A concrete wall does literally nothing in the modern era. Spend it on radar, more men, and judges (judges to process all of those asylum seekers).

orwin5• 8 years ago

I've heard that most illegals arrested at the borders (airports too) or when detected are supposed to wait until judgment (hence cages last year i guess?), but the justice Dpt is so underfunded that it take a really long time to pass judgment, and people end up staying.

It was in a meetup around 2015, a French man who overstayed his visa to launch his company in Florida (something about autofilling paperwork for tutition and taxes). He got arrested 6 month before the launch date, still launched the product in time, then paid a lawyer to get away since his first visa was tied to an abusive company.

Why not giving those 5 Billion to accelerate those judgments, see what happens? I might be more effective.

And if you think a wall is effective, you should see how gibraltar handle border security, and ask them why they don't just build a wall. It may be less true now than when i visited northern morocco in my teens, but i have the feeling than people in charge of border security there might be puzzled by the idea.

khawkins3• 8 years ago

The National Border Patrol Council, a labor union with over 18,000 members and represents the US Border Patrol, fully endorses congress funding the border wall [1]. It's the solution that the people who are actually there, on the ground, are asking for.

And in terms of money, the American Recovery and Reinvestment Act of 2009 spent $831 billion since it was passed. The border patrol is asking for a pittance of that amount.

[1] https://bpunion.org/featured/why-congress-should-fund-trumps...

kss238• 8 years ago

Previously it was against the wall. What happened?

https://motherboard.vice.com/en_us/article/59v7k3/border-pat...

xwvvvvwx• 8 years ago

It’s also gonna make it way harder for the gov to attract talent for a while.

thatoneuser8• 8 years ago

Eh. Most government positions are really "big talent" kind of ordeal. Most are a stable way to make decent money with great benefits and retirement. The ones that are valuable will still get their talent I'm sure.

JTbane• 8 years ago

I, for one, am very glad to not be a government worker. Imagine getting a free month-long unpaid vacation, or worse, a month of work without pay!

twunde• 8 years ago

Even worse, there's no known end date. You can't go traveling, visit your family or anything else you'd do on vacation because the shutdown _could_ end tomorrow and then you'd have to go back.

assblaster5• 8 years ago

If the wall is immoral and ineffective, should the United States destruct the existing portions of the wall already built at the US-Mexican border?

jrochkind12• 8 years ago

I mean, I'd say yes, but you don't have to think so to not want to spend billions on more of it.

cenal• 8 years ago

Watched this video from CBS News recently and it looks like portions of the wall in place are sticks with wire: https://youtu.be/5o4d6Wp3u2Q

assblaster5• 8 years ago

What about the wall at the border by San Diego? That's a much better fortified structure, and if immoral and against the principles of the United States, wouldn't this portion be worth getting rid of?

atoav• 8 years ago

The wall is symbolic. It is completely useless for the proclaimed purpose.

jasonlotito3• 8 years ago

If walls are effective, why isn't the plan to build one around all of the US?

The reason is simple: walls aren't effective everywhere. The walls and fences that are up now? They weren't just randomly placed. They were put where they were to do the most good. Some have been more effective than others, but all together, the problem is no longer along the souther border.

As for the plan for the wall being immoral: it's not right to waste money on things that 1) don't have a real plan, and 2) we have solid evidence suggesting it won't be effective doing what we want it to do.

If you want to stop people from entering the US illegally and living here, you would do well to cut off their supply of jobs. This means going after organizations like the ones Trump runs that hire these people.

Not only will that be less expensive, it will be more effective, and have more of an immediate impact.

assblaster5• 8 years ago

If you want to stop people from entering the US illegally and living here, you would do well to cut off their supply of jobs.

However, if illegal aliens do not have jobs, then they will need to be on welfare, which would definitely mean more than there are already currently.

If the existing unsecured border was truly secure, then there would not be 22 million illegal aliens living in the United States, so obviously something has to change since the status quo is unsustainable.

Illegal immigration from Canada is not a major problem, especially since it's so hard to get into Canada, both from an asylum/immigration standpoint, but also geographically (surrounded by water).

TomMckenny2• 8 years ago

Putin sure got his money's worth.

khawkins3• 8 years ago

"Citing an unnamed official."

This headline is misleading. It suggests that Trump administration officials are publicly reporting this, when the question of who is saying this cannot be confirmed.

war10252• 8 years ago

The way I've been thinking about it is that shutdown a couple years ago was really a game of chicken where neither side thought it was actually going to happen.

This time around it's more of a siege tactic where the idea is to hunker down until one side feels enough pain that they will yield. It's really a case of which side's base can tolerate the pain longer without either flipping sides or losing faith in the leadership.

Plus it's Trump's power tactic at letting the Dems know he's the boss even now that they have the House. He has zero problem playing the bad guy to get what he wants and come out on top.

khawkins3• 8 years ago

It's just as much Pelosi and Schumer playing politics. They don't want to give him any money, despite this being a fairly small request, because they know that if he can't deliver on his central campaign promise it will tear his base away from him and secure his 2020 defeat.

war10252• 8 years ago

Like I said, it's seige tactics on both sides. Which base is willing to starve for longer basically.

odorousrex• 8 years ago

because they know that if he can't deliver on his central campaign promise it will tear his base away from him and secure his 2020 defeat.

This is not true.

Trump could capitulate on the wall and he wouldn't lose a single voter in his "MAGA" base. He's basically a personality cult.

Sure the conservative talking heads will rant and rave for a while, but by 2020 it will all be forgotten. All of his supporters will find internal justifications to support him again even if it's a simple as "never supporting a 'libtard'". (They would rally around Gorsuch/Kavanaugh, low taxes, et al...) Trump will blame democrats (ofc) and his base will see it that way. "He didn't surrender it's the 'DEEP STATE' that got him!"

Pelosi/Schumer base is not so cultish - They won't forgive nor forget. They have everything to lose.

thatoneuser8• 8 years ago

I have to agree. Trumps political career will consist of 4-8 years. He doesn't have any reason to care about anything but doing what he promised.

And like you say - it's really not a big ask. It's around .1% of the US spending last year.

Edit: Sigh. Downvoted for stating pretty obvious truths. 5 billion to the US govt is very little. Trump isn't a lifetime politician, he's just in it for a term or two. If anyone has a valid criticism of those two statements please write it down.

yellowapple5• 8 years ago

Correction: his base will blame Pelosi and Schumer for standing in the way of border security and vote in droves for Trump Term 2: Electric Boogaloo.

scruple• 8 years ago

"We defeated him on the wall, we'll defeat him in 2020!" Yes, I have had the same thought for the last week or two. I'm no fan of Trump but I'm also no fan of Pelosi. These are ultra wealthy people playing games with each other at the expense of Americans.

vikingcaffiene3• 8 years ago

Ugh what a mess. It's not just that we are lighting money on fire, it's also that the reason for all of it is so pointless. Those poor furloughed workers are having very real damage inflicted upon them. Damage that will take years to recover from if they ever do. It's cruel, its pointless, its stupid. At this point the shutdown has cost more than a wall ever would.

Then of course there's the more disturbing thought that if I were a Russian asset looking to sow chaos and economic instability in the country, a shutdown (and a trade war, and alienating our allies abroad) would do a pretty good job...

nopriorarrests2• 8 years ago

Damage that will take years to recover from if they ever do.

Can you please elaborate? From my limited knowledge, furloughed workers haven't got a paycheck (yet) for a one month. Is this kind of damage they will be recovering from for years?

dragontamer9• 8 years ago

In the 2013 Shutdown, a number of government experiments (ie: Flu Experiments) were destroyed due to neglect from the shutdown. Which ended up having the worst Flu Vaccination success rate in the last 10 years or something (like a stupid low 30%).

Etc. etc. Government projects are stopped during shutdowns. It literally takes years to recover from a shutdown (another year or two before Flu Vaccination experiments were back up and running at full potential)

vikingcaffiene3• 8 years ago

Well something like 50% of the country (I don't have the actual stats in front of me but I recall its more than half) lives paycheck to paycheck and has no savings. I remember what that was like before I got lucky enough to find a career in software development. Back then $100 was at TON of money (honestly I still think of it that way but I digress) and missing a paycheck would have been a disaster. One time my car broke down in the desert for instance and I had to leave it there for months so I could save up enough money to get it towed and repaired. It was an unexpected expense of a few hundred dollars but I remember breaking down in tears about it because I knew how much of a blow to my bottom line it was. I nearly lost my job because I had no way to get there, I had to pay parking fines for my stranded vehicle, I had to borrow money with no real way of paying it back. It was an unmitigated disaster that took me a long time to recover from. My point being, a lot of people live their days on a financial tight rope and an unexpected expense like missing a paycheck starts a cycle of debt that gets harder and harder to recover from. These furloughed workers deserve better.

dplgk• 8 years ago

You might be saying the shutdown cost more than the money currently requested amount for the wall but I can't agree that it costs more than a wall ever would.

vikingcaffiene3• 8 years ago

That is in fact what I meant. Apologies for the confusing wording.

nkurz2• 8 years ago

Does anyone have thoughts on the theory that after 30 days of shutdown, it's easier to remove otherwise protected employees? The source I saw doesn't seem particularly trustworthy (https://www.americanthinker.com/blog/2019/01/omb_issues_guid...) but the argument seems plausible enough. The idea is that a fast-tracked "Reduction in Force" reorganization plan intended to permanently downsize the government could be backdated to the beginning of the shutdown, thus giving Trump considerable leverage over Congress. Is there anything to this argument?

Shutdown Will Be Worse for Economy Than First Thought, White House Says

Related Stories