Today has surprised some people who went about their daily business without knowing what's closed in a government shutdown.
Another surprise: Markets didn't plummet. There are a few reasons for that:
- The government isn't entirely closed.
- A closing isn't as uncommon as it is being made out to be. Government shutdowns have occurred 18 times since 1976.
- Negotiations are still being talked about behind the scenes.
- Markets are really more concerned about the debt ceiling deadline (which is now Oct. 17).
And assuming a deal is reached sometime within the next few weeks, the impact on fourth-quarter economic growth from this U.S. government shutdown is expected to be relatively minimal. Any loss is expected to be easily made up in Q1 of 2014.
Nonetheless, a government shutdown is still a very big deal, no matter the duration.
Failing to reach a deal Monday night, with the Republican-led House of Representatives insisting on delaying U.S. President Barack Obama's signature healthcare reform bill (aka Obamacare) as a condition for passing a bill, the shutdown began at 12:01 a.m. Tuesday. It marks the first government shutdown in 17 years. Last time, services were suspended for 28 days.
Just after midnight, President Obama tweeted: "They actually did it. A group of Republicans in the House just forced a government shutdown over Obamacare instead of passing a real budget."
As the 12 p.m. deadline approached, the White House budget office started notifying federal agencies to begin an "orderly shutdown."
Some 800,000 federal employees face unpaid leave, with no guarantee of back pay once the deadlock is over. Staff affected include 400,000 at the Department of the Defense, 40,200 at the Department of Commerce, 12,700 at the Department of Energy, and 18,500 at the Department of Transportation.
What's Affected in a Government Shutdown
Because most essential government operations will continue as normal, a good majority of Americans won't feel the effects of a short-term shutdown. However, a prolonged shutdown is another story. The economy will sorely suffer, and Americans in need of government services will be greatly inconvenienced.
Experiencing no interruptions: