After the US government shut down for the first time in 7 years, President Donald Trump on Thursday claimed that "billions of dollars can be saved" from it, hinting at a massive DOGE-style clearing operation underway.
The government shutdown from October 1 onwards comes after a Trump-Congress stalemate over a funding deal, and will reportedly affect as many as 750,000 federal workers across the nation.
With the US government predicted to lose a whopping $15 billion in gross domestic product per week of the shutdown, as per a memo from the White House's Council of Economic Advisers, unemployment rates could shoot up, and consumer spending could go down, possibly pulverising the economy, a POLITICO report said.
The longer the shutdown, the worse it will be for the economy: the memo notes that if it lasts for a month, as many as 43,000 people could lose their jobs, in addition to almost 2 million federal civilian workers already affected from day one.
However, unlike past government shutdowns, many of these federal workers now face layoffs, rather than furloughs (temporary periods of being unpaid).
The Trump administration also decided to freeze $26 billion of funding for Democratic-leaning states, following through on his earlier threat against his political opponents as he tries to gain more control over the US' $7 trillion federal budget, a Reuters report said.
Restarting US government operations after the shutdown would be another issue.
The expensive reboot process, coming after cuts in spending—that would have impacted vital government functions—would ensure that the net savings from the endeavour are far smaller than the damage done to the US economy.
As a Congressional Budget Office (CBO) report about the US government's 35-day partial shutdown in 2018-19 shows, $18 billion in federal spending was only delayed, not saved, which led to a GDP decline for the fourth quarter of 2018 by $3 billion.
