U.S. Government Shutdown Cost the Economy $11 Billion

On Monday, February 8, the U.S. Congressional Budget Office announced that the economy suffered a $11 billion loss due to the 35-day shutdown of part of the government over budget disputes regarding the border wall requested by Donald Trump. However, now that 800,000 federal employees have returned to work, it is expected that a significant portion of this loss will be recovered. The Congressional Budget Office, a nonpartisan research entity, stated that the economy was hit by approximately $11 billion during these five weeks, but with the reopening of offices and the payment of back wages to employees, it is predicted that about $8 billion of this amount will be compensated. Another part of the report indicates that due to the shutdown of part of the government, the U.S. economy will shrink by about 0.02% in 2019. However, small businesses and employees, especially those who did not receive paychecks, will be the most affected by the consequences of this situation. The longest federal government shutdown in U.S. history ended on Friday after an agreement between Donald Trump and Congress to reopen offices without approving the border wall budget. Donald Trump insists that the government budget must include $5.7 billion for the construction of the wall at the Mexican border, which he claims is necessary to prevent illegal immigration, human trafficking, and drug smuggling. A committee composed of lawmakers from both parties began public sessions on Wednesday to discuss security at the southern U.S. borders, aiming to reach some agreement before the February 15 deadline. According to the Congressional Budget Office's assessment, due to the shutdown of part of the government, the country's gross national product (GNP) decreased by about $3 billion in the last quarter of 2018. This entity also states that in the first quarter of 2019, the actual GNP figure will be $8 billion less than the predicted figure. Donald Trump has stated that if Congress does not reach an acceptable agreement, he will shut down government offices again and expressed doubts about reaching such an agreement on Sunday. He has also suggested that he might declare a national emergency to secure funding for the border wall. This unusual action will certainly face opposition from Democrats and some Republicans and will be challenged in the courts. Unpaid wages for government employees over the past five weeks are set to be paid this week. However, businesses and contractors dependent on government contracts and employee wages will incur significant losses. Some members of Congress have proposed a bill to compensate contractors for their losses.