What happens when government shutdowns?

The new fiscal year (FY) will begin on October 1, 2021, and none of the 12 appropriations bills that establish discretionary spending levels have been passed by Congress. The government will shut down if lawmakers do not pass legislation to pay the programs covered by the appropriations process by midnight on the last day of the fiscal year, September 30. A continuing resolution (CR) is expected to be proposed to provide legislators extra time to finish work on spending measures. In contrast to the most recent FY 2019 shutdown, which began in late 2018 and lasted into early 2019, which affected departments and agencies covered by the seven appropriations bills that Congress had not yet enacted, a shutdown in FY 2022 would affect all federal activities covered by discretionary appropriations.

What is a government shutdown?

Many federal agencies and programs are reliant on Congress's regular budget allocations. Each year, Congress must pass, and the President must sign budget legislation for the following fiscal year, which includes 12 appropriations bills, one for each Appropriations subcommittee. The 12 legislation that make up the discretionary expenditure budget for FY 2022 have yet to be passed by Congress. During a "shutdown," all non-essential discretionary activities of federal agencies must be suspended until new funding legislation is negotiated and signed into law. Essential services and required expenditure programs continue to operate.

What services are affected in a shutdown and how?

Each federal agency creates its own shutdown strategy, which is coordinated by the Office of Management and Budget and based on prior shutdown instructions (OMB). The plan indicates which federal functions will be halted until appropriations are restored, which would necessitate furloughs and the suspension of numerous agency activities. Essential services, many of which are connected to public safety, continue to be provided, with payments covering any obligations incurred only when appropriations are passed. Border security, in-hospital medical treatment, air traffic control, law enforcement, and power grid maintenance have all been classed as vital services in previous shutdowns, with certain legislative and judicial employees mainly safeguarded. Mandatory expenditure that is not subject to yearly appropriations, such as Social Security, Medicare, and Medicaid, continues to be funded. Other activities that remain include those that are financed by non-appropriated permanent user fees, such as immigration services paid by visa fees.

Despite the fact that many services are excluded, the public is likely to be affected by the shutdown in a variety of ways. In a complete shutdown, for example:

1.    Checks are paid out for Social Security and Medicare but benefit verification and card issuance will be discontinued. During the 1995-1996 closure, more than 10,000 Medicare applicants were temporarily turned away every day of the shutdown, which is unlikely to happen again.

2.    The Environmental Protection Agency (EPA) paused site inspections at 1,200 distinct sites in 2013, including hazardous waste, drinking water, and chemical plants, while the Food and Drug Administration (FDA) postponed about 900 inspections. During the 2018-2019 shutdown, the FDA resumed certain food inspections for high-risk goods a few weeks after the funding lapse ended.

3.    The National Park Service turned away millions of tourists to more than 400 parks, national monuments, and other sites during the 2013 closure. According to the National Park Service, the closure cost the country more than $500 million in missed tourist spending. During the 2018-2019 closure, several parks remained open, albeit no visitor services were given, and damage and garbage build-up were recorded at various locations around the country.

4.    Air Transport: Due to air traffic controllers and Transportation Security Administration (TSA) personnel working without pay during the 2018-2019 closure, air travel was hampered. Travelers encountered lengthier queues when several TSA officers failed to show up for work, and security checkpoints were closed, while the absence of ten air traffic controllers momentarily halted transport at LaGuardia Airport and created delays at other major airports.

5.    The National Institutes of Health (NIH) would be unable to admit new patients or process grant applications, according to the Department of Health and Human Services. States were obliged to pay for formula grant programs like Temporary Assistance for Needy Families (TANF, sometimes known as "cash welfare") in 2013.

6.    The Internal Revenue Function (IRS) would be unable to fulfil its routine service of validating income and Social Security numbers if the government were to shut down. In 2013, a backlog of 1.2 million such petitions caused delays in mortgage and other credit approvals, as well as billions in tax returns. During the 2018-2019 shutdown, at least 26,000 furloughed IRS workers were recalled working in preparation for tax season, but 14,000 did not show up to work without pay.

7.    Though funding for the Supplemental Nutrition Assistance Program (SNAP) is required, the ability to send out "food stamp" benefits may be harmed by a shutdown, as continuing resolutions typically only allow the Department of Agriculture (USDA) to send out benefits for 30 days after a shutdown begins. The USDA paid February SNAP payments early on January 20, just before the 30-day window closed, during the 2018-2019 closure, but it would have been unable to pay March benefits if the shutdown had continued. Furthermore, retailers are unable to renew their Electronic Benefit Transfer (EBT) card permits during any shutdown, so those whose licenses are about to expire will be unable to use their cards.

Is the government preparing for a shutdown?

The Office of Management and Budget keeps track of the numerous contingencies plans that federal agency will use in the event of a shutdown. The majority of them have been updated in the last three years, however others haven't been updated since a threat of shutdown in late 2015.

A full shutdown would be more severe than the partial shutdown that began in December 2018 when Congress passed five of the twelve budget bills. A full shutdown would be akin to the ones that occurred in 2013 and early 2018, when around 850,000 non-postal government employees were furloughed out of a total of 2.1 million. In 2013, the majority of the Department of Defense's 350,000 civilian employees were called back to work within a week. Employees who have been furloughed are unable to work and do not get pay, although they are entitled to back compensation under legislation approved in January 2019. Back compensation has never been paid to federal contractors in the past.

An estimated 380,000 employees were dismissed at the start of the partial shutdown in 2018-2019, a lower amount than normal because significant government employers like the Department of Veterans Affairs and the Department of Defense were already funded. Another 420,000 workers showed up for work but were not paid until the closure ended. Departments and organizations including as the IRS and the State Department recalled a growing number of staff as the 2018-2019 closure progressed.

How many times has the government shut down?

There have been 20 "funding gaps" since Congress established the modern budget process in 1976, including the 2018-2019 shutdown and the one in January 2018, where money were not approved for at least one day. (Federal employees were not furloughed during the hours-long shortfall in funding in February 2018, which was frequently referred to as a shutdown.) Prior to 1980, however, the government did not shut down but instead continued to operate normally despite six financial shortfalls. Since 1981, there have been ten funding shortages of three days or less, the majority of which happened over the weekend, when government activities were only slightly disrupted.

Four "real" shutdowns have already occurred, with operations disrupted for more than one working day. The first two occurred in the winter of 1995-1996, when President Bill Clinton and the Republican Congress were unable to reach an agreement on spending levels, resulting in two government shutdowns totaling 26 days. The third occurred in 2013, when a House-Senate impasse over funding for the Affordable Care Act (ACA) led to a 16-day government shutdown. The fourth shutdown, which lasted 35 days and began in December 2018 and ended in January 2019, was based on a disagreement over border wall funding.
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