Washington D.C.—With House Republicans and the Democrats are in a showdown. We are now facing the possibility of the first government shutdown in 17 years. Speaker of the House John Boehner kowtowed to hardline republican pressure. House republicans are using the fear of a shutdown to delay the Affordable Care Act, also known as Obamacare for one year. A plan was approved this morning to keep the government running just after midnight on Monday. But we shouldn’t worry about this government shutdown as it is unlikely. Don’t sit on the edge of your seat just yet. Wait until the upcoming debt ceiling fight.
Fear is looming and the American public, jaded about this do-nothing Congress, is afresh with anxiety over this new threat. A government shutdown would not dissolve the economic recovery, as we are far enough along, as is Europe, for it to matter much. It will hurt many federal agencies and adversely affect the stock market. But the market won’t take a total nose dive. So all of this would support the idea that House Republicans can play chicken with a shutdown without much worry.
The fear of a looming shutdown is not popular with investors however, many of which are tried and true conservatives. Wall Street is one of the Republicans biggest donors. Causing Wall Street pain or panic would do serious damage to the Republicans, particularly cogent with an election coming up in 2014. It could also affect support in the 2016 presidential election, a big worry as the Republicans got a shellacking last time and now face the mighty Hilary Clinton.
The Republicans have alienated women through the many Republican candidates who couldn’t, for the life of them, stop talking about rape in the previous election. They GOP has alienated Hispanics, a huge and necessary demographic, due to the insistence of some in their ranks for greater oversight and punitive measures against illegal immigrants. So why is a government shutdown unlikely? The GOP wouldn’t alienate its base and swing voters as well. It has pushed away so many groups already.
If the shutdown takes place, U.S. landmarks will be shuttered and civil servants will be sent home. Most people who do not work in the government would not care about the latter. And the summer tourist season is over. Still, those who take the time this fall to visit the Statue of Liberty, Yellowstone or some other national landmark may hold their ire for the Republicans come voting time.
There have been a total of 21 shutdowns since the mid 1970’s. Some lasted for one day, the longest up to 21 days. The latest bill that threatens a shutdown passed along party lines. Senate Majority Leader Harry Reid called the measure “pointless.” The Senate will not take up the amendment, forcing House republicans to either approve Obamacare funding or shutter the federal government entirely. To make matters worse, a vote on the debt ceiling is to take place in the weeks ahead. Not raising the debt ceiling would be a total disaster. The U.S. would default on its financial obligations. Polls have consistently shown that the Republicans would bear the brunt of a shutdown, and again if raising the debt ceiling was not approved. This blame would make reelection hopes for GOP House Republicans very unlikely. Ergo, a government shutdown is unlikely.
By: Philip Perry