As Home Republicans wrestle to maintain the federal authorities open past September 30, NPR’s Ari Shapiro speaks with a trio of NPR correspondents concerning the potential influence of a authorities shutdown.
ARI SHAPIRO, HOST:
Whether or not or not you’re employed for the federal authorities, a shutdown has sweeping penalties, from meals and well being advantages to the army, to the economic system as an entire. And these results preserve rippling out the longer a shutdown lasts. If Congress does not agree on a plan, a shutdown may start this weekend. We’ll take a look at what this might imply throughout a number of completely different sectors. And let’s begin with NPR’s Selena Simmons-Duffin, who covers well being coverage. Hey, Selena.
SELENA SIMMONS-DUFFIN, BYLINE: Hello, Ari.
SHAPIRO: OK, if the federal government does shut down this weekend, what influence is that going to have on individuals who rely on federal advantages for meals and different help?
SIMMONS-DUFFIN: OK, so SNAP advantages, which was once often called meals stamps, wouldn’t be affected within the quick time period. So folks ought to nonetheless obtain their October advantages, have the ability to purchase their groceries as traditional. Nothing modifications there. However maybe probably the most dramatic instant influence could be for households that depend on one other meals program referred to as WIC, which stands for Ladies, Infants and Youngsters. And that may be minimize off inside days of a shutdown, based on the Agriculture Secretary Tom Vilsack, who spoke with NPR yesterday.
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TOM VILSACK: It helps practically 7 million pregnant mothers, postpartum mothers and kids beneath the age of 6. Almost 50% of all younger youngsters within the nation take part on this program. When there’s a shutdown, inside a matter of days, advantages are minimize off to those households.
SIMMONS-DUFFIN: Now, the influence on WIC would doubtless be staggered as a result of some states may need carryover funds or may have the ability to use their very own state funds to maintain issues going for somewhat bit. Different packages that might be affected embody Head Begin, which helps little 3- and 4-year-old children, and Meals on Wheels, which brings meals to the aged. And that might get interrupted as nicely. After which there’s federal staff themselves, who must go with no paycheck. The Capital Space Meals Financial institution right here in Washington instructed me it is getting ready for as many as 100,000 federal staff to want meals help if the federal government shuts down.
SHAPIRO: Wow. Effectively, let’s herald NPR Pentagon correspondent Tom Bowman. Tom, you have been taking a look at what a shutdown would imply for the U.S. army. What’s the headline there?
TOM BOWMAN, BYLINE: Effectively, some 1.3 million lively army personnel should preserve working and never receives a commission, together with – get this – greater than 400,000 Protection Division civilians. Their final paycheck will probably be on Friday if there’s a shutdown that begins over the weekend. Now, past the potential for no paychecks after Friday, there are another issues for the army. The army commissaries on bases, that are mainly like neighborhood grocery shops with good costs, most of them will shut across the nation however stay open abroad. Now, the USAA, which is america Car Affiliation, which gives insurance coverage and banking companies for lively army and veterans, has mentioned it can present no-interest loans and likewise extensions for mortgage and bank card funds for its members. The massive problem, after all, Ari, is that if there is a shutdown, how lengthy does it final?
SHAPIRO: And these individuals who may cease getting their paychecks reside in communities that rely on service members spending the cash they earn. So how may that ripple out past the armed forces?
BOWMAN: Effectively, there is no query there will be ripples within the occasion of a shutdown in sure areas with giant numbers of army personnel. Get these numbers. California – 163,000. Virginia – 129,000. Texas – 114,000. After which North Carolina, Florida, Georgia every have tens of hundreds of army personnel. And there are clusters of army of us in these states round bases and different amenities. So, you understand, lots of people will probably be going to eating places, bars. They’re army areas, so you may see tattoo parlors, motorbike outlets.
And the opposite factor folks discuss to me about is, you understand, younger army households dwelling off base. They may, over time, have bother making ends meet, shopping for groceries, little one care prices. They usually may postpone purchases – like clothes, automotive repairs, issues like that – which might, after all, damage native companies, once more, if this shutdown occurs. After which, does it proceed for weeks or longer?
SHAPIRO: Yeah, and this might clearly influence the U.S. economic system as an entire. NPR’s David Gura has been taking a look at that. David, I do know you have been analyzing the influence of previous shutdowns. What have you ever realized?
DAVID GURA, BYLINE: Yeah, the newest shutdown bridged 2018 and 2019. It was through the Trump administration, and it was the longest shutdown on report. It went on for 35 days. And I am going to simply word right here, it was a bit completely different than this shutdown. HHS wasn’t affected, the Protection Division wasn’t both. The funding was separate there. Even nonetheless, 800,000 federal staff have been furloughed. The Congressional Finances Workplace says it delayed about $18 billion value of spending. It affected financial progress. GDP in these two quarters, Ari, was fractionally decrease, between 0.1 and 0.2% decrease than what economists anticipated.
SHAPIRO: And as you talked about, that final shutdown went on for longer than a month. What would change if we have been to see a shorter shutdown, like a number of days or per week, versus these 35 days final time?
GURA: It might be a giant distinction. As Tom mentioned only a minute in the past, that is the large problem right here, how lengthy this shutdown lasts, if we get one. The longer it lasts, the higher the damaging influence on each the U.S. economic system and on U.S. monetary markets. In a brand new word, the scores company Moody’s says it expects a brief shutdown this time round and one that may have, quote, “restricted ramifications for the broader U.S. economic system and GDP.”
Previous is prologue, however one thing completely different this time round is the economic system is already dealing with a bunch of headwinds. The Federal Reserve has been attempting to chill down the economic system to combat excessive inflation, and in consequence, progress is slowing. On prime of that, power costs are going up. Russia and Saudi Arabia lately agreed to increase manufacturing cuts. That might push up fuel costs, which, after all, has a huge impact on how folks really feel concerning the economic system and on their willingness to spend. And in just some days, tens of tens of millions of Individuals should begin repaying their pupil loans. So whereas there may be all this optimism concerning the Fed reaching that delicate touchdown, getting excessive inflation beneath management with out triggering a recession, there are loads of components that might make the Fed’s job much more tough, a shutdown could be one other one.
And really rapidly right here, one thing else that might complicate issues is, if there have been a shutdown, the businesses that accumulate and distribute the info the Fed depends upon might be closed. And which will sound like a small factor, just a few knowledge, however the Fed has mentioned and continues to say it is making its selections about rate of interest hikes primarily based on these financial knowledge. Jobs numbers for the month of September, they’re speculated to be launched subsequent Friday, new inflation knowledge the week after that. At that time, we’re getting very near the Fed’s subsequent assembly, which is scheduled to begin on Halloween, October 31.
SHAPIRO: OK, so there are loads of unknowns. There are loads of causes to be involved. However there are additionally some issues that Individuals need not fear about even when there’s a shutdown. So, Selena, let’s flip again to you for a sigh of reduction. Sixty-seven million Individuals depend on Social Safety checks. These will preserve going out, proper? What about Medicare and Medicaid? Will folks have the ability to preserve seeing the physician?
SIMMONS-DUFFIN: Sure, that could be a little bit of fine information. So individuals who get medical insurance and even well being care from the federal authorities, whether or not that is via Medicare or the Indian Well being Service or VA well being care, they should have no interruptions due to a shutdown. So everybody on the market who makes use of these packages, you’ll be able to nonetheless go to the physician, you’ll be able to nonetheless make appointments. And HHS says it has sufficient cash to maintain paying states for Medicaid and CHIP. That is the Youngsters’s Well being Insurance coverage Program. A minimum of they’ve sufficient for a number of months, which is nice as a result of round 90 million low-income folks depend on these medical insurance packages.
Once more, these packages shouldn’t be affected, assuming that it does not – the shutdown does not final for various months, which is fairly unlikely. However it’s not all excellent news on this entrance, I ought to say. One space of concern is neighborhood well being facilities. These are mainly security internet main care clinics that get their funding from federal grants. And that funding would doubtless be disrupted by a shutdown. Some clinics are going to native information. They’re speaking to their Congress members and warning that they might want to chop again on companies or workers relying, once more, on the timing of the doable shutdown and the way lengthy it lasts.
SHAPIRO: A lot relies on how lengthy it lasts.
SHAPIRO: NPR’s Selena Simmons-Duffin, David Gura and Tom Bowman. So good to have all three of you right here within the studio.
GURA: Nice to be right here.
SIMMONS-DUFFIN: Nice to be right here. Thanks.
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