02 October 2013

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US Government Shutdown Explained Effects of US Shutdown

US Government Shutdown Explained Effects of US Shutdown

In USA fiscal year ends at midnight Sept. 30.

The US Government follows the fiscal year October 1 to September 30. So by September 30, every year, the US House of Representatives and the US Senate must agree upon a budget for the following fiscal, in this case, fiscal year 2013-14. This year however, the politicians were not able to agree on the budget. Without a budget, non-essential staff of the Government cannot be paid.

Due to disagreements between the two houses over federal government spending, the US Congress failed to pass a budget before the fiscal year ended on 30 September.

The 2013 fiscal year ends at midnight September 30.

This led to the first government shutdown in 17 years at 12.01am

The Budget must be approved by both the houses that is

1)The US House of Representatives
2)The US Senate.

Currently in USA the House of Representatives is controlled by Republicans and The US Senate is controlled by President Obama’s Democrats.
As per US constitution both houses agree on a budget and then it goes to US President

US Shutdown is a political situation in which government stops providing for all but 'essential' services.

There have been 17 government shutdowns since 1976, the longest lasting 21 days over the 1995-1996 New Year period when President Bill Clinton faced off with the Republican Speaker of the House New Gingrich. Republicans were blamed for the shutdown and Clinton was re-elected in 1996.

Exactly what happens in shutdown?
What are the effects of US Shutdown on American citizens and other nations?

Ten minutes before midnight on 30 September, the White House budget office issued orders for government offices to start shutting down, with workers told to stay at home without pay.

The president and members of Congress will continue to be paid in the shutdown.

Essential services like social security payments and military will continue to operate.

Employees of non-essential services will be asked to go on unpaid leave.

The failure to agree a federal budget means that hundreds of thousands of US public servants will be put on unpaid leave. An estimated 800,000 civilian workers out of 2.1 million will be affected.

More than 400 national parks and monuments, from Yosemite National Park in California to the Statue of Liberty in New York, will close to tourists.
All the animals will be fed and taken care of but cams won’t work

NASA will put almost all of its employees on unpaid leave, though staff will continue working at the space agency’s mission control in Houston to support the international space station.

The military and other agencies involving safety and security would continue to function.

Air-traffic controllers, active military personnel, and border security guards are to be told to report for work, but new passports will not be issued and tax offices will also close.

Air traffic controllers and firefighters contracted by the National Forest Service will continue to work, but park rangers and researchers who conduct clinical trials at the National Institutes of Health will be furloughed.

Even some of the White House staff might have to stay at home and all Smithsonian institutions in Washington are to close.

However, workers like teachers, firefighters and doctors will continue to be paid, as they are paid for by the state, not the federal government.

According to IHS estimates, the daily cost in lost output will be just $300m, which is trivial for an economy whose annual output is 52,000 times greater.
White House website says that, a one week shutdown could cost American economy about $10 Billion

Services providing healthy meals for 2.5 million seniors would lose funding

An extended shutdown would cut into veteran’s compensation, pension and education benefits.

In an extended shutdown, mothers and young children may be cut off from vital nutrition assistance.

Hundreds of thousands of workers would be immediately and indefinitely furloughed without pay.

Reality views by sm –

Wednesday, October 02, 2013

Tags – US Shutdown Explained


Usha October 02, 2013  

Not a good day today..I had some hope that this will be avoided at last minute but it failed. It is sad to read that several Govt employees will not receive pay for these lost days. Hope this gets over soon.

Another disappointing news since morning is new enrollment for medical insurance under Obama Care...sadly it is going to cost much more than what people are paying now . Several benefits and coverage ratio is reduced, deductibles are raised.

There is lot of confusion... as of now I don't know if this new obamaCare will bring relief or more disaster?.

Arti October 02, 2013  

It seems to be a recipe for disaster? But considering it, our government seems to be in a shutdown mode at every time!!

Destination Infinity October 02, 2013  

Happy holidays for employees? Interesting system, they have.

Destination Infinity

SM October 03, 2013  

@Destination Infinity
Its sad story for them not happy
they wont get paid and no salary

Bill Cover Insurance October 25, 2013  

The recent shut down has indeed created a negative impact to the country's economy.