In the past week, the U.S. government has declared a government shutdown effective as of October 1st, this is due to the inability of democratic and republican representatives to reach an effective decision over the federal health insurance bill, this sudden halt in the decision making and governing process has caused the government’s tax and subsidy system to come to a grinding stop. This pause in spending and funding has many effects on local business and public corporations, large amounts of labor, previously employed by the government, are now on paid leave or extended holiday, operations deemed non-essential by the government have also been closed or paused for the time being.
The economy is now suffering due to this shutdown, as business operations are interrupted, Gross Domestic Product and government revenue falls, leading to lower amounts of money flowing through the economy and decreasing wages and incomes in the long term. The U.S. Government is also discussing raising the debt ceiling in anticipation of a longer pause in business operations and more public business closing shop as the treasury estimates that it will find itself incapable of paying the country’s debts by October 17th.