Categories
Archive
Links
Australian Federal Government Jobs
The Issues in the Government's Budget Battle
For the first time since Bill Clinton was in the White House, there is a severe danger of a government shutdown – the result of major differences between a Republican House of Representatives and a Democratic President and Senate. The Republicans want to make reductions in government spending while the Democrats fear that those spending declines would result in the loss of hundreds of thousands of jobs.
The budget reductions advocated by the Republicans come entirely out of social programs and do not affect the Defense Department (20% of the budget) or other large portions of the budget. The Democrats are concerned that the proposed reductions would severely hurt the poor. Originally, the Republicans wanted to reduce government spending by 60 billion dollars. The Democrats were concerned that a spending decline of that magnitude would be a drag on an economy in the midst of a weak recovery from the worst recession since the Great Depression and would result in the loss of hundreds of thousands of jobs. Most economists – including many Republican economists – apparently agree. The Republican leadership – after a number of meetings with President Obama – have brought their demands for spending reductions down to about 30 billion dollars. But the Republicans have an internal problem. The Tea Party segment of their caucus – consisting of over 40 House members – is unwilling to compromise. Thus, we have this dreadful impasse.
The Consequences of a Government Shutdown
If an agreement is not reached by midnight of Friday, April 08, 2011, the U.S. Government would face a shutdown. Initially, the shutdown would only be a partial one similar to the one during the administration of President Clinton. On that occasion, vital services were continued. The post office still delivered the mail, social security checks were issued, members of the military were paid and all other vital services were continued. National parks and monuments were closed and other non-critical services were discontinued.