Despite the name calling and bickering in Washington, we find ourselves on Day 16 of the Government Shutdown at the time of drafting this piece. The longest shutdown in US history was under President Clinton and lasted for 21 days, the second longest being under President Carter in 1978.
For weeks we have heard nothing but one side blaming the other, like a bunch of children who refuse to get along (that comment being directed towards both sides of the aisle). According to the Washington Times, some federal employees have even been directed by their superiors to “make life as difficult for people as they can” amidst the shutdown. We find this rather interesting, seeing as how a source in the Senate told the Washington Examiner that CBO estimates predicted that 83% of federal operations would not be affected by the shutdown. Many furloughed employees have even been called back to work since the start of the shutdown.
Experts predicted that this lack of civility in Washington would certainly result in economic calamity, yet the markets are not supporting that theory. The Dow Jones Industrial Average has been flat for the month, the US Dollar Index is up slightly and the Market Volatility Index is lower than it was at the beginning of October. We believe that this is a sign the markets understand that this shutdown is nothing more than political posturing. Some have joked that perhaps the government is even running 17% more efficient today than it was before the furloughs began.
However, the cynics in us require that we look beyond the markets and beyond the face value of the debates taking place in the Senate and the House to look at what this really means. Our government is shutdown and is (allegedly) telling federal employees to make things as difficult for the citizens of our nations as they possibly can. To be honest though, very few individuals are actually feeling any sort of effect from the shutdown. Vital government operations are still being taken care of, and yes there are some federal employees who have not been recalled yet (and it is likely that they will receive back pay once this is all settled), but not nearly the amount that we were led to believe would be out of work.
We believe that this shutdown may very well blow back in the faces of all politicians on Capitol Hill. Instead of the citizenry demanding that Congress get together and reach a compromise to end the shutdown, many are noticing that the shutdown has not had the major impact on the economy or daily life that they were led to believe that it would. Essentially, many are figuring out that perhaps government operations are a bit too cumbersome, and that the politicians in Washington lied about just how significant the shutdown was going to be.
We hope that our elected officials can put aside their differences and do what they were elected to do; pass a budget, act responsibly, and get back to governing.