Tag Archives: federal shutdown

CEI Podcast for October 3, 2013: The Federal Shutdown

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Have a listen here.

For the 17th time since 1976, the federal government has shut down over a partisan fiscal squabble. Vice President for Strategy Iain Murray gives his thoughts on how it happened, what the consequences will be, and what is at stake.

Much Ado about Nothing: Budget Cut Edition

Democrats want the federal budget to be about  $3,730,000,000,000. Republicans want it to be about $3,630,000,000,000. As with many other issues, the difference between the two parties is less than three percent. Even so, it nearly led to a federal government shutdown.

The deal that the two parties recently struck to avoid a government shutdown meets somewhere in the between. It is advertised as cutting $38.5 billion of spending. But on closer inspection, it would actually cut $14.7 billion. That would cut total federal spending by 0.39 percent.

I have a hunch that even those small cuts may not actually happen. This blog post I wrote in 2005 explains why.

The rules of the game in Washington are severely stacked in favor of spending increases. Presidents Bush and Obama grew the federal government by about 100 percent in only a decade with little political pain. And it apparently takes the specter of a government shutdown to reduce spending by 0.39 percent.

If anyone is looking for a reason for fundamental institutional reform, that would be a big one.

Federal Government Shuts Down Due to Snow

Few people outside of the DC area are likely to notice, but the recent snowstorm shut down the federal government today. Another big snow is on the way, so the feds are also taking tomorrow off.

The Washington Post reports:

Official estimate [sic] that closing the federal government for a day due to the weather costs roughly $100 million in lost productivity and opportunity costs, meaning this weekend’s storm will have potentially cost taxpayers at least $250 million, for last Friday’s early dismissal and Monday’s and Tuesday’s closures.

That is dwarfed, of course, by the opportunity costs of having a $3.8 trillion federal government in the first place. Not to mention the productivity losses.The federal government spends $49.1 billion enforcing regulations that cost nearly $1.2 trillion. if even half of that were freed up, imagine the good that would come of it.

The billions and billions of dollars spent on earmarks and stimulus would do far more good if that money stayed in the productive sector, subject to the self-correcting mechanisms of profit and loss.

In short: America benefits when Washington busybodies take a few days off. So enjoy it while it lasts.

There is great wisdom in Mark Twain’s famous adage: “No man’s life, liberty, or property are safe while the congress is in session.”