Clock ticks as U.S. gov't shutdown looms

The White House is shrouded in haze in Washington, D.C., the United States, on June 29, 2023. (Photo by Aaron Schwartz/Xinhua)

The government shutdown could be the last straw that tips the U.S. economy into recession, beginning in the fourth quarter of this year, especially given the signs of economic slowing.

Tourism in Washington, D.C. could be impacted, as some museums could close if their money runs out. Restaurants, bars and other go-to places for tourists could be impacted.

WASHINGTON, Sept. 29 (Xinhua) -- The clock is ticking as a U.S. government shutdown looms.

As lawmakers scramble to pass a budget before the Oct. 1 deadline, all eyes are on Democrats and Republicans, who can not agree on a budget amid a bitter partisan divide.

If the two parties fail to meet the deadline, some federal government departments could temporarily shut down.

On Friday, the Senate agreed to recess until noon on Saturday, as the government inched ever closer toward a shutdown.

Lawmakers must pass a new budget by midnight Saturday, before thousands of federal workers are put on unpaid leave.

While the shutdown would be an inconvenience to many federal workers, crucial government services such as police and fire fighters would not be impacted.

Most impacted would be a range of government services, such as passport applications, visitors' centers at national parks, the timely release of economic data, and some nutritional programs.

A Senate plan to temporarily fund government programs through Nov. 17 gained some traction earlier in the week. That would give Congress more time to negotiate.

Partisan wrangle over spending has prompted government shutdown multiple times and the previous one occurred in 2018, when some government departments shuttered for 35 days, the longest in U.S. history.

ECONOMIC IMPACT

The timing of any government shutdown could adversely impact the economy.

Desmond Lachman, a senior fellow at the American Enterprise Institute and a former official at the International Monetary Fund, told Xinhua: "A government shutdown would come at a very inopportune time for the U.S. economy, which is now being hit by several adverse shocks."

Oil prices are approaching 100 U.S. dollars a barrel, borrowing costs have risen sharply due to high interest rates, and there is an auto worker strike, Lachman said.

Gas prices are displayed at a gas station in El Monte, Los Angeles County, California, the United States, on Sept. 28, 2023. (Photo by Zeng Hui/Xinhua)

"The government shutdown could be the last straw that tips the U.S. economy into recession, beginning in the fourth quarter of this year, especially given the signs of economic slowing," Lachman said.

Tourism in Washington, D.C. could be impacted, as some museums could close if their money runs out. Restaurants, bars and other go-to places for tourists could be impacted.

POLITICAL FALLOUT

Republicans tend to favor lower government spending, and Democrats lean toward higher spending.

With Republicans reluctant to make a deal, that party could feel voters' ire in next year's presidential elections.

Christopher Galdieri, a political science professor at Saint Anselm College, told Xinhua: "Shutdowns never help the party that's seen as initiating them. This is as close to an ironclad rule of politics as I can think of."

"In this case, you've got (former President) Donald Trump openly egging the House GOP on, and a weakened speaker who can't get his caucus together. Meanwhile, the White House will be responding with one voice," Galdieri said.

"But the election is 14 months away -- it's unlikely to be at the top of anyone's mind by then," Galdieri said.

However, a shutdown could hurt Republicans in the U.S. state of Virginia, as Republicans hope to gain full control of the legislature in that state, which borders on Washington, D.C. and is home to thousands of federal workers and government contractors.

Brookings Institution Senior Fellow Darrell West told Xinhua: "The House seems ungovernable right now and not able to pass basic budget bills. When national parks close and other important services stop, voters will be very upset."

Clay Ramsay, a researcher at the Center for International and Security Studies at the University of Maryland, told Xinhua: "If a shutdown occurs, the chances are good that it will also bring the ouster of (Kevin) McCarthy as speaker."

"This would add to a public impression of chaos, and Democrats will use it all as exhibit A to convince independents that the current crop of Republicans can't govern," Ramsay said.