Shut it Down!

 Shameless Ask: As the Shutdown drags on, the pinch we feel gets harder and harder, I love writing and sharing these posts, but they take time for me to research, write, and publish. If you feel you benefit from them, and you have a little extra would you consider making a small donation  to help us keep them going. Disclaimer: 30Rock is the Intellectual Property of NBC and images and characters used here are used for educational purposes under Section 107 of the US Copyright Law: Fair Use.  

How Does this happen?

Hello Readers! As I write this post we have charged head first into the 23rd day of the Partial Government Shutdown, the DC area is blanketed in snow from a storm dubbed by the Capital Weather Gang “#Snurlough” and I am up to my eyeballs in an inbox full of messages and I thought this morning that I would do a quick post to address the question I get most often: “How Does This Happen?”. So let’s take a quick jaunt through the why behind the what with Shutdowns, with a little help from Jack Donaghy and 30Rock.

It’s All About the Money 

A partial or full shutdown of the United States government happens with Congress fails to pass sufficient appropriations bills or continuing resolutions (CR) to fund Federal agency operations, or when the president refuses to sign such bills or resolutions into law. When this happens the Government relies on the current interpritation of the Antideficiency Act which requires the Federal Government to begin a “shutdown” of the affected activities once their current funding expires. 

Each Federal program is classified as “excepted” or “non-excepted” from the Antideficiency Act.  It’s a complex puzzle that agencies aren’t always prepared for. 

Long Shutdowns are partisan 

Before we jump in a quick reminder: Long shutdowns have happened under the leadership of both parties and are inherently partisan. It is often not the stubbornness of an individual, but the reluctance of many to stop “towing the party line” that causes and prolonged shutdowns. American democracy is, unofficially, a two-party system. George Washington tried to warn us all that this sort of thing would happen with two parties, but sadly, we didn’t listen. 

In our 242 year history the US Government has shut down nine times that have resulted in actual employee furloughs (consider this a missed opportunity for a clip from Ferris Beuller’s Day Off...”He’s been absent from school…nine Times”) there have been three other times that short funding lapses have happened and employees were told to continue reporting to work.  Let’s walk through the history. 

1980

You are reading that correctly, dear reader, we made it 204 years before we shutdown the government. It was a good run. So, here’s what happened in 1980, the first time a funding lapse caused a partial Government Shutdown. 

Throughout our history, there have been funding lapses that didn’t result in shutdowns which was technically non-compliant with the Antideficiency Act. In the 1970’s a Congressional Staffer in Representative Gladys Spellman’s (D-MD) office came across the Antideficiency Act and Spellman contacted then Comptroller General Elmer Staats for an opinion. Staats issued his opinion that “We do not believe that the Congress intends that 

Federal agencies be closed during periods of expired appropriations.” Pretty simple. Cut and Dried. Except…Enter Attorney General Benjamin Civiletti who, on April 25, 1980 overturned Staats’ opinion with one of his own. Stating that the Act did, indeed, intend for agencies to shutdown in the absence of funding.

5 days Later 

On the 1st of May funding for the Federal Trade Commission (FTC) expired which, in turn, caused the first-ever shutdown of a Government agency due to a lapse in appropriations. At the time, the FTC was funded through its own appropriations bill, so no other agencies were effected. Here’s why the FTC funding didn’t pass: Members of Congress delayed the funding extension because they wanted to pass an authorization bill that would limit the investigatory and rule-making powers of the FTC. Powers that were criticized by these members, and big business, for being too aggressive in the monitoring of economic activity. 

Because this occurred just 5 days after Civiletti issued his opinion, these members were genuinely surprised that a shutdown was actually enforced. And enforced it was, 1,600 workers were furloughed and meetings and court cases were canceled. In fact, it was such a surprising new concept, that US Marshalls were dispatched to two FTC field offices to enforce compliance.

The first shutdown lasted one evening, it cost the taxpayers an estimated $700,000 ($1.8 million in today’s dollars) and the same party controlled the presidency and both houses of Congress.  

1981, 1984, 1986

I am lumping these together because I can. Also because they fit together nicely. So, let’s roll through them, shall we?  

1981

On November 23, 1981, President Reagan vetoed a spending bill because it contained fewer spending cuts then he had proposed. This veto resulted in a partial shutdown and 241,000 Federal workers were subsequently furloughed for one day. This cost the Government an estimated $80-$90 million in back pay and other expenses. 

1984

October 4, 1984, 500,000 Federal employees were furloughed for one afternoon. The funding lapse was due to the inclusion of a water projects package and civil rights measures in the funding bill that the President opposed. Congress removed these programs the next day and included funding of a compromise regarding the Nicaraguan Contras. 

This shutdown is estimated to have cost the Government $65 million in back pay alone.

1986

 A little over two years later, on October 17, 1986 several disagreements between the House and the President, which included such issues as: a provision to ban companies from creating subsidiaries to get around  labor contracts, requirements that half the goods and labor used in offshore oil rigs be American in origin, and expanded Aid to Families with Dependent Children (which is what was commonly referred to as Welfare at the time). When the disputes could not be resolved in time to keep agencies funded, 500,000 Federal employees were furloughed for one afternoon. The Democratic House backed off many of their issues, and workers were back at work quickly, but it cost the Government an estimated $62 million in lost work. 

1990

Remember when George H.W. Bush told us to “Read my Lips” because there would be no new taxes? Then When faced with the realities of Governing, was he was forced to propose new taxes as part of his deficit reduction program? Well, this led to a bit of a revolt by then-House Minority Whip Newt Gingrich. Gingrich was successful in defeating the initial appropriations package, and funding lapsed over the Columbus Day (Now often referred to as Indigenous People’s Day) Holiday. Because this shutdown occurred over a holiday weekend the 

overall effects were limited but highly visible as the Smithsonian Institution and the National Parks Service were both effected on what is historically a busy weekend for them.  Around 2,800 Federal employees were furloughed between October 6 and October 8, costing the Government an estimated $2.57 million in lost revenue and wages. 

1995-1996

Here’s where this starts to get interesting. These two shutdowns are the begining of what I would call modern shutdown history (although they are all technically modern). This is where we start to see the Devil-May-Care Brinksmanship that we’ve come to know well, ready? Let’s do this.  

1995

Here we go, Gingrich vs. Clinton, round 1. Are you ready to rumble? 

On November 14, 1995 the GOP-controlled congress sent a CR that would have raised Medicare premiums, committed the President to balance the budget within seven years, and cut environmental and other regulations off at the knees. The President vetoed the CR, which triggered and funding lapse and you guessed it we shut it down and furloughed 800,000 workers. The 1995 shutdown lasted until November 19th, after 5 days, and ended when President Clinton, Speaker Gingrich, and Majority Leader Dole reached an agreement that funded the Government at 75% for four weeks while the budget negotiations continued. Less Than A Month Later…

1995-1996

Well, here we are again. As it turns out those negotiations didn’t go so well and on December 5, 1995 we reached an impasse around whose numbers would be used to reach that balanced budget (CBO vs. OMB) and shutdown again.  This shutdown would see the furlough of 240,000 Government Employees for what was, until now, the longest Shutdown in history clocking in at 21 full days. The shutdown ended on January 6, 1996 when Republicans backed away from their demands and passed legislation to keep the Government open, The president then submitted a budget plan that CBO said would meet the requirement to balance the budget within seven years. 

2013

We had a nice long, more than a decade, run with out a shutdown there, but that comes screeching to a Duke-brothers-style hood-sliding halt in 2013. On Tuesday October 1, a deadlock around the CR caused a shutdown that saw 800,000 Federal employees furloughed. What was it all about you ask? 

The GOP-led House, encouraged by conservative Senators like Ted Cruze and groups like Heritage Action offered several CRs with language delaying or defunding the Patient Protection and Affordable Care Act (commonly referred to as the ACA or Obamacare), whereas the Democrat-led Senate passed several amended CRs maintaining funding at (then sequestered) levels with no additional conditions. The politicking was strong with this one, from both sides but, in the middle of the night on October 16th, Congress passed the Continuing Appropriations Act 2014, the President signed it shortly after midnight on October 17th and the 16-day shutdown was over. S&P has estimated that the 2013 Shutdown cost the US Economy $24 Billion. 

2018

 

That brings us to now,  23 days we are currently in the midst of the longest partial shutdown in history. Funding expired for several agencies at Midnight on December 22, 2017 and 800,000 Federal employees (and thousands of their Contractor counterparts) are either furloughed or working without pay.  We all know how we got here. There we are, a brief history of Shutdowns. Jack and I are signing off now. 

About the Author

 

Elizabeth DeBiase, CF APMP, has spent her life immersed in the GovCon community. She has helped government contractors – from entrepreneurs to Fortune 100 companies – navigate the arcane and complex regulations that govern the process of winning and managing government contracts. Today, Liz is the majority owner of TWRG, and dedicates her time to making sure the truly ethical companies win government contracts so that citizens get the best services for their tax dollars.

Being inside GovCon is to watch the sausage getting made. The vast majority of procurement actions are tied to taxpayer needs and are public knowledge, but very few people can take the time to follow the hundreds of thousands that are released each year. Liz’s career has given her the ability to quickly recite the historical and most recent major contract actions, describing who won them, why they did, and the effect they have on American communities. She can tell you how the Federal government works and why it works that way so that you can be more informed. 

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