Source: Robert Polner, Futurity, January 16, 2019
The current government shutdown is now the longest on record, sidelining roughly 800,000 non-essential workers in nine agencies out of about two million full-time federal employees in all (excluding postal workers and soldiers). ….
…. The shutdown’s impact extends, Light estimates, to more than 4.1 million contract workers and grantees, as well as the hundreds of thousands of other workers. Like those non-critical workers sitting at home, contract workers, who are largely in service jobs, do not expect to be paid until Congress and the president come to an agreement to resume appropriations.
When they’ll achieve a compromise is anybody’s guess. The sticking point in this shutdown is the more than $5 billion in border-wall funding that President Trump has requested.
Meantime, fallout spreads: the appropriations freeze is bringing complications for traditional government services, from public-health inspections of food and environmental hazards to security screening.
Here, Light talks about the shutdown’s broad repercussions and if he can predict a possible end date: ….
Source: Jamila Michener, The Conversation, January 14, 2019
….People living in poverty are now bracing for that kind of chopping as a result of the partial government shutdown that began in December. By the three-week mark, most safety-net benefits were still being funded. But should the impasse drag on, that could change.
In my view, the added economic hardship brought on would highlight an enduring aspect of American public policy: Government benefits can be unreliable. They can be cut or eliminated arbitrarily….
Source: Federal Funds Information for States, Budget Brief 18-19, December 19, 2018
From the summary:
The second fiscal year (FY) 2019 continuing resolution (CR)—which funds the portion of federal spending not covered by full-year spending bills enacted earlier this year—will expire on Friday. While Congress just announced an agreement on another short-term CR through February 8 and the president appears to support it, the risk of a federal shutdown likely will continue until a final budget is enacted.
Should a partial shutdown occur, state officials will have questions about their ability to operate federal grant programs in the absence of a current appropriation. The answers to those questions vary by program. FFIS Budget Brief 18-17 provides answers to general questions; this brief provides targeted summary information about specific grant programs.
Appendix: links to the sources of program-specific details
Source: Congressional Budget Office, pub. no. 54667, December 2018
From the summary:
CBO periodically issues a volume of options—this year’s installment presents 121—that would decrease federal spending or increase federal revenues. CBO’s website allows users to filter options by topic, date, and other categories.
Since 2007, federal debt held by the public has more than doubled in relation to the size of the economy, and it will keep growing significantly if the large annual budget deficits projected under current law come to pass. The Congress faces an array of policy choices as it confronts the challenges posed by such large and growing debt. To help inform lawmakers, the Congressional Budget Office periodically issues a compendium of policy options that would help reduce the deficit, reporting the estimated budgetary effects of those options and highlighting some arguments for and against them.
This report, the latest in the series, presents 121 options that would decrease federal spending or increase federal revenues over the next 10 years (see Summary Table below). Of those options, 112 are presented in the main body of the report, and most of those 112 would save $10 billion or more over that period. The remaining 9 options are presented in an appendix and would generally have smaller budgetary effects…..
Source: CRS In Focus, November 19, 2018
The condition and performance of infrastructure are generally thought to be important for the nation’s health, welfare, and economy. More contentious are the optimal level of infrastructure investment, the effectiveness of this investment, and the appropriate role of the federal government. The current federal role in infrastructure investment is important but limited in size and scope.
Source: Congressional Budget Office, August 8, 2018
From the summary:
Each year, CBO publishes extended baseline projections—a set of budget projections that incorporate the assumption that current laws generally remain unchanged, extending the agency’s 10-year baseline projections beyond the coming decade. In CBO’s most recent extended baseline, revenues grow more rapidly than gross domestic product (GDP), rising to levels well above their historical average, because recently enacted tax changes are scheduled to expire and because of the structure of the tax system. In addition, discretionary spending falls substantially in relation to the size of the economy. Nevertheless, federal debt held by the public rises from an amount equal to 78 percent of GDP in 2018 to 118 percent of GDP in 2038. This report expands on CBO’s extended baseline projections by showing how the federal budget and the nation’s economy would evolve under three alternative scenarios. In those scenarios, laws would be changed to continue certain policies now in place, leading to even higher debt.
Source: Steve Wamhoff, Matthew Gardner, Institute on Taxation and Economic Policy (ITEP), Analysis, July 2018
From the introduction:
Since 2000, tax cuts have reduced federal revenue by trillions of dollars and disproportionately benefited well-off households. From 2001 through 2018, significant federal tax changes have reduced revenue by $5.1 trillion, with nearly two-thirds of that flowing to the richest fifth of Americans, as illustrated in Figure 1.
The cumulative impact on the deficit during this period is $5.9 trillion, including interest payments. By the end of 2025, the tally of tax cuts will grow to $10.6 trillion. Nearly $2 trillion of this amount will have gone to the richest 1 percent. By then, the total impact on the deficit will be $13.6 trillion, including interest payments.
This analysis does not include hundreds of billions of dollars in so-called tax cut “extenders” for corporations and other businesses that Congress has periodically enacted under each administration. More detailed figures are provided in the tables in Appendix I…..
Data Available for Download
Source: Grant A. Driessen, Congressional Research Service, CRS Report, R45202, May 21, 2018
The federal budget is a central component of the congressional “power of the purse.” Each fiscal year, Congress and the President engage in a number of activities that influence short- and long-run revenue and expenditure trends. This report offers context for the current budget debate and tracks legislative events related to the federal budget. …. Trends resulting from current federal fiscal policies are generally thought by economists to be unsustainable in the long term. Projections suggest that achieving a sustainable long-term trajectory for the federal budget would require deficit reduction. Reductions in deficits could be accomplished through revenue increases, spending reductions, or some combination of the two. ….
Source: Dmitriy Plit, Florence Zeman, Moody’s, Sector Comment, Public housing authorities – US, April 4, 2018
The recently enacted federal omnibus spending bill appropriates $2.75 billion for the Public Housing Capital Fund, a substantial increase over the $1.94 billion for federal fiscal year 2017.
Source: Marcia Van Wagner, Coley J Anderson, Rachel Cortez, Baye Larsen, Timothy Blake, Alexandra S. Parker, Moody’s, Sector In-Depth, March 30, 2018
US states, local governments and transit authorities’ funding constraints add a layer of difficulty to the Trump administration’s infrastructure plan. The proposal relies on municipalities’ ability to increase leverage, identify new revenue streams and attract private sector partners.