Several months ago, I argued that the United States debt ceiling is a counterproductive and anti-formalist measure that should be eliminated, albeit for what establishment thinkers might call the wrong reasons. However, the debt ceiling is only part of the problem. Another part is the practice known as a government shutdown. Let us examine this practice and its effects, then make the case for its elimination.

Overview

Article I, Section 8 of the United States Constitution delegates the power of the purse to Congress. Appropriations bills must start in the House of Representatives, then be approved by the Senate. Next, both houses must agree on a final version to send to the President’s desk. The President may approve the budget by signing the bill into law, or he may veto it. Following a presidential veto, Congress has the options of revising the budget to be more in line with the President’s position or trying to override his veto with a two-thirds majority in both houses (290 House members and 67 Senators at present). If no budget is passed before the existing budget cycle ends, a shutdown will occur.

A proper understanding of government shutdowns begins with the Antideficiency Act of 1870, which was passed in response to the behavior of government agencies. Before that time, it was common for government agencies engage in coercive deficiency; which is to say that they would spend more money than Congress had appropriated for them and dare Congress to allow them to cease operations and fail to meet obligations until the next fiscal period. The Act put a stop to such behavior by specifying that agencies may only spend money that Congress has appropriated for them. It has been amended several times since, most recently in 1982.

During a shutdown, the Office of Management and Budget determines which government functions are stopped.[1] Active duty military, federal law enforcement, medical personnel in federal hospitals, and air traffic controllers remain employed, while most of the civilian workforce and the full-time, dual-status military technicians in the National Guard are furloughed.[1][2][3] Self-funded programs, such as the US Postal Service, continue operation.[4] Programs funded by laws other than appropriations, such as Social Security, can be interrupted if they rely on activities that are funded by annual appropriations.[5] Members of Congress continue to be paid because only direct law can alter their pay.[6]

Initially, federal agencies responded to shutdowns by minimizing non-essential operations. Their reasoning was that Congress did not intend for them to close while waiting for a budget deal to be made. In 1980 and 1981, Attorney General Benjamin Civiletti issued two opinions concerning interpretation of the Antideficiency Act. These stated that the Act requires agency heads to suspend operations until appropriations are enacted, with the only allowable exceptions being “a reasonable and articulable connection between the function to be performed and the safety of human life or the protection of property.”[5] Despite these opinions, only four out of nine funding gaps between 1980 and 1990 resulted in furloughs.[7] Since 1990, the practice has been to effect a shutdown for any funding gap.

This type of government shutdown is unique to the United States. Systems which are more democratic, such as parliamentary systems, do not have separate legislatures and executives. Executive ministers in these systems are designated by the parliament, and failing to pass a budget usually counts as a no-confidence vote and triggers a snap election. There are usually provisions in place to continue using the previous year’s budget until a new one can be passed. In less democratic systems, the executive usually asserts the authority to continue operating the government without an approved budget.[8]

History

After the Budget and Impoundment Control Act of 1974 created the current budget process that came into use in 1976, there have been twenty such occasions as of this writing, eight of which led to furloughs. President Ford vetoed a funding bill for the Department of Health, Education, and Welfare and the Department of Labor, beginning a partial government shutdown on September 30, 1976. Congress overrode his veto on October 1, and a continuing resolution was passed on October 11.

A dispute between the House and Senate over Medicaid funding for abortions caused three shutdowns in the autumn of 1977 for a total of 34 days. The abortion issue returned in 1978 along with President Carter’s veto of a public works appropriations bill and a defense bill, leading to a 19-day shutdown. The abortion issue returned again in 1979 along with debates over pay increases for Congress members and civil servants, resulting in a 13-day shutdown. The Federal Trade Commission was shut down for one day on May 1, 1980, furloughing 1,600 workers and costing $700,000.[9]

The first overall shutdown with a furlough of federal employees occurred in 1981 under President Reagan during a debate over budget cuts and lasted three days, with the employees furloughed one day.[10] The next four shutdowns in 1982-84 over various budget proposals did not involve furloughs.[11][12] A shutdown over water projects, civil rights, and the Nicaraguan Contras let to a shutdown that furloughed 500,000 people on October 4, 1984. Another such shutdown and furlough occurred on October 17, 1986. A dispute over the Contras and the Federal Communications Comission’s Fairness Doctrine caused a short non-furlough shutdown in 1987.[10]

The next shutdown occurred over Columbus Day weekend in 1990 as a result of a dispute over tax increases, as President George H.W. Bush went against a campaign promise and Congressional Republicans sought to hold him to it. The effects were lessened because the shutdown occurred on a weekend, but there were still 2,800 furloughed workers for a loss of $2.57 million as the National Parks and Smithsonian museums were closed to visitors.[10][13]

The two shutdowns of 1995 and 1995-96 were more serious. Conflicts between President Clinton and Congressional Republicans over funding for education, environmental programs, Medicare, and other health programs led to full shutdowns during November 14-19, 1995 and from December 16, 1995 to January 6, 1996. The first of the two shutdowns caused the furlough of 800,000 workers, while the second caused 284,000 workers to be furloughed.[5]

The desire of Congressional Republicans to defund and delay the Patient Protection and Affordable Care Act (commonly known as “Obamacare”) led to a budget standoff that almost resulted in a sovereign default.[14] During the October 1-16, 2013 shutdown, 800,000 federal employees were furloughed while another 1,300,000 were required to work for future pay.[15] The Continuing Appropriations Act, 2014 ended the shutdown.[16]

The most recent shutdowns as of this writing occurred on January 20-22 and on February 9, 2018. The first occurred over the issue of funding for programs for illegal immigrants, and led to furloughs.[17][18] The second resulted from Sen. Rand Paul (R-KY) holding up a vote and lasted only a few hours.[19]

The Case For Elimination

The case for eliminating government shutdowns is rather straightforward. First, they are not a way to restrain spending. In fact, they do the opposite. Although confidence in the job market recovered within a month and GDP growth slowed no more than 0.2 percent following the 2013 shutdown, this imposed a greater cost on the economy than that of keeping the government open.[20][21][22] Because labor is lost during the shutdown and furloughed workers always ultimately receive back pay for the time in which they were furloughed, the state simply becomes more wasteful than it would be otherwise.

Second, though it may appear desirable from a libertarian perspective to have state officials doing nothing, the ruling and enforcement classes are generally exempted from the effects of a shutdown. Only the paper-pushers and funding recipients are inpaired in their functionality during such times. While it is a travesty that the state has monopolized so many services, it is even worse for those services to be shuttered, leaving people in the lurch. Additionally, scientific studies that require a constant influx of state funding can be lost.[23] While it would be better to have privately funded research, letting a state-funded experiment proceed to its conclusion is a lesser evil than completely wasting the money spent on part of an experiment.

Third, for the above reasons, shutting down the government is almost always damaging to fiscal hawks. Unless those who oppose programs and/or seek to cut spending have the skill set of Donald Trump, the tactic backfires, giving political points to enemies of liberty. It is better to remove this option so that reformers must seek out other methods which may be more effective.

Finally, the concept of government shutdowns in the United States is thoroughly anti-formalist. In other words, official reality does not match actual reality, the underlying power dynamics are hidden, and accounting practices are dishonest. What is called a government shutdown is really only a partial slowdown, the true power of the Cathedral over the national finances is obscured by belief in the false power of Congress, and the furloughed employees are always paid for their non-work in the long run. These illusions should be dispelled. When the United States government does finally shut down, it will not be over some relatively minor political issue that causes a budget not to pass and keeps some of the federal workforce home for a few days, so let us rid ourselves of such false hopes.

Eliminating Shutdowns

There are several methods by which the current phenomenon of government shutdowns may be ended. One method is to stipulate that in the event of an impasse, the previous year’s budget will continue to be used until a new one can be passed. As mentioned earlier, this measure is used in many other democratic systems to prevent shutdowns. This change to the appropriations process would eliminate the uncertainty of operating without a budget, abolish continuing resolutions and the onerous compromises that tend to occur with them, provide a better baseline for negotiations, and prevent some budget disputes altogether in the event that enough politicians find the budget not to be bad enough to demand changes. A possible side effect of budgets remaining the same for years because the need to debate them so frequently is removed would be a decided plus, as budget changes invariably mean more government spending.

Another possibility is to make the salaries and benefits of the President and of members of Congress part of the annual appropriations process, thus removing these during a shutdown. Although most of them would be capable of surviving on bribery and insider trading tips, their salaries are sufficiently large that anyone receiving them would notice their sudden absence. The loss of all of the privileges they enjoy for the duration of a shutdown would be an even more powerful incentive. How much good this measure would do is debatable, but it would provide good optics at least.

A third method would be to strike the root. The Antideficiency Act was intended to solve the serious problem of government agencies bullying Congress into appropriating more funding for them. But when coupled with other measures, such as the debt ceiling and the current appropriations process, it has unintended consequences. To reinterpret, amend, or outright repeal the Antideficiency Act in order to remove the legal basis for shutdowns would prevent their occurrence. While coercive deficiencies would likely return, this would provide fodder for capitalists to argue that government services which cannot be provided without consistently running over budget need to be turned over to the private sector.

Conclusion

The practice of government shutdowns in the United States is needlessly wasteful, counterproductive, and deceitful. Although the measures that ultimately created the practice appear to have been implemented to curtail waste, fraud, and abuse, the road to hell is paved with good intentions. While ending government shutdowns would be far from sufficient for restoring sanity to federal budgets, it is a necessary step. Whether by the above methods or another, let us hope that action is taken soon.

References:

O’Keefe, Ed; Kane, Paul (2011, Apr. 2). “Government Shutdown: Frequently Asked Questions”. The Washington Post. Riley, Charles (2011, Apr. 6). “Shutdown: 800,000 Federal Workers in the Dark”. CNN Money. Paletta, Damian (2011, Apr. 6). “Government Prepares for Shutdown”. The Wall Street Journal. Kolawole, Emi (2011, Apr. 8). “Government Shutdown 2011: Will I Get Paid? What Will Be Open? What Can I Expect?”. Federal Eye (blog of The Washington Post). Brass, Clinton T. (2017, Nov. 30). “Shutdown of the Federal Government: Causes, Processes, and Effects” (PDF). Congressional Research Service (via Federation of American Scientists). Shear, Michael (2011, Apr. 7). “Will Members of Congress Get Paid in a Shutdown?”. The Caucus (blog of The New York Times). Tollestrup, Jessica (2013, Oct. 11). “Federal Funding Gaps: A Brief Overview”. Congressional Research Service. p. 4. Zurcher, Anthony (2013, Oct. 1). “US Shutdown Has Other Nations Confused and Concerned”. BBC News. Barringer, Felicity (1981, Nov. 24). “Behind the Shutdown, a Long-Dormant Law”. Washington Post. ISSN 0190-8286. Borkowski, Monica (1995, Nov. 11). “Looking back: Previous Government Shutdowns”. The New York Times. ISSN 0362-4331. Tolchin, Martin (1982, Oct. 1). “Conferees Adopt Stopgap Fund Bill”. The New York Times. ISSN 0362-4331. Pear, Robert (1984, Oct. 4). “Senate Works Past Deadline On Catchall Government Spending Bill”. The New York Times. ISSN 0362-4331. “Government Shutdown: Data on Effects of 1990 Columbus Day Weekend Funding Lapse”. U.S. General Accounting Office. (1990, Oct. 19). Espo, David (2013, Sep. 30). “Republican Unity Frays As Government Shutdown Looms”. Huffington Post/AOL/Associated Press. Plumer, Brad (2013, Sep. 30). “Absolutely everything you need to know about how the government shutdown will work”. Wonk Blog, The Washington Post. Cohen, Tom (2013, Oct. 17). “House approves bill to end shutdown”. CNN International. Shaw, Adam (2018, Jan. 20). “Government braces for shutdown as Senate fails to meet deadline for spending deal”. Fox News. Barrett, Ted; Bash, Dana; Diaz, Daniella; Killough, Ashley (2018, Jan. 23). “Congress approves plan to end shutdown, reopen government”. Kaplan, Thomas (2018, Feb. 9). “Trump Signs Budget Deal to Raise Spending and Reopen Government”. New York Times. The Economist (2013, Oct. 5). “Closed until further notice”. The Economist. Randstad USA “Employee Confidence Rebounds in Month Following Shutdown”. Randstad USA. “Rand Paul rightly says the government shutdown was more expensive than keeping it open”. @politifact. Cross, Tim (2013, Oct. 16). “Robot-Aided, Mass-Murder Jellyfish Orgy”. The Economist.

Support The Zeroth Position on Patreon!

Like this: Like Loading...