In the United States, a record shutdown at the expense of the economy




The paralysis of the US administration broke a record time in the night of Friday 11 to Saturday 12 January. The Senate must meet again starting January 14 to try to find a favorable outcome to a situation that would cost $ 1.2 billion a week to the country's economy.




► What is shutdown?

The shutdown, "Closure", in English, refers to the paralysis of federal administrations in the United States, for lack of budget funding. It started on December 22, 2018, since a stand-off between President Donald Trump and the Democratic Party over the federal state budget. The Democrats refuse to finance the construction of a wall against anti-migrants wanted by Donald Trump, to the tune of 5.7 billion, along the border with Mexico.

Friday January 11 at midnight (ie Saturday 5 am GMT), this administrative paralysis has become the longest in the history of the country. The previous "record" - 21 days - went back to Bill Clinton's time in 1995-96. At this stage, no compromise has yet been reached. The Senate is expected to meet again on Monday, 14 January.

► What are the economic consequences of shutdown?

Since December 22, 800,000 federal public servants (out of 2 million) are affected. Half of them, considered "non-essential", were placed on unpaid leave. The other half was requisitioned, without being paid.

This block is not the first - there have already been 21 since 1976. But precedents had not lasted long enough to affect the country's growth while the current judgment has been prolonged for three weeks, a new scenario .

The partial closure of the US administration costs the economy $ 1.2 billion a week, according to Ann Beth Bovino, chief economist at Standard and Poor's Global Ratings. If it continues for another two weeks, the paralysis will have cost the country as much as the wall claimed by Donald Trump. " As the blockage becomes longer, the suffering increases She describes.

In addition to the remuneration of civil servants, it is all the activity of the country that suffers. Farmers are on the front line. Those who suffer from Donald Trump's trade war can not currently receive the promised compensatory aid, while seed and feed subsidies are not provided to farmers who start planting.

On the corporate side, the stock exchange policeman, the SEC, has stopped processing IPOs while oil and gas licenses are lagging behind.

US slips into budget stalemate

For the poorest citizens, the risk is getting closer to being without food assistance from the end of February, the end of the current budgets. As a result, the Federal Reserve has asked banks to be understanding and the Housing Ministry has asked landlords not to evict the poorest tenants whose rent is subsidized by the federal government.

Tourism is also struggling: national parks are idling for lack of guards, which affects the attendance of hotels and restaurants ... Every day in normal times, the 400 national parks normally report 18 million dollars.

The federal capital of Washington is particularly concerned also since it shelters 20% of the federal workers, who logically stopped any expenditure of consumption, leisure ...

More broadly, the 800,000 currently unpaid employees owe a total of about $ 438 million a month in rent and mortgage payments, according to Zillow real estate firm calculations.

► What are the prospects?

The House of Representatives has already passed an overwhelming majority on Friday, January 11, a law already passed by the Senate that guarantees federal employees retroactive pay. But it does not concern contract workers with the government, who are currently losing $ 200 million a day, according to an estimate by Bloomberg News.

"I have a plan for shutdown"assured Donald Trump on Saturday, January 12th. According to several American media reports, the White House plans to redirect emergency aid funds for various areas ravaged by natural disasters, such as Puerto Rico, to fund the construction of a border fence.

But Friday, January 11, the Republican billionaire had assured not to want to declare "so fast" such a national emergency procedure, which would surely plunge the country into a politico-judicial storm. "I want to give [aux démocrates] the opportunity to see if they can behave responsibly ", he also justified in an interview Saturday night on the Fox News channel.

How to get out of this paralysis? If it continued, it would have "a noticeable effect" on the world's largest economy, for its part warned the boss of the US Federal Reserve, Jerome Powell.



Marie Dancer (with AFP)











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