Kaine Sounds Alarm About Costs of Government Shutdown, Calls on Congressional Republicans to Fund Government on Time

WASHINGTON, D.C. – Today, U.S. Senator Tim Kaine sounded the alarm about the costs of a government shutdown and called on Republicans in Congress to fund the government by the October 1 funding deadline:

“During my time in the Senate, I’ve seen the unnecessary harm a government shutdown inflicts upon federal employees, government contractors, and millions of Americans who rely on government services. While I will continue working with my colleagues to prevent a shutdown, we should never be in this position to begin with. It’s unacceptable that there are some Republicans in the House who are willing to shut down the government if they don’t get everything they want. We need to come together to pass a bipartisan bill to fund the government past September 30.”

Kaine has been outspoken against the use of government shutdowns as a negotiating tactic. In an effort to end this brinksmanship, Kaine introduced his End Shutdowns Act, legislation to prevent government shutdowns.

A government shutdown means federal employees, including over 170,000 in Virginia, may be placed on a mandatory leave of absence, also known as a furlough, or expected to work throughout the shutdown but not receive payment until the government reopens. During the 2018-2019 shutdown—which caused about 380,000 furloughs—Kaine objected to the Senate going out of session, which resulted in him securing passage of legislation to guarantee back pay for federal employees for that and all future shutdowns.

Government contractors and subcontractors in Virginia are also impacted by shutdowns because federal agencies are not able to award or modify government contracts, and companies with government contracts could be told to stop work from agencies that run out of funding for the year. This could result in federal contractors’ pay and benefits to be delayed or suspended or they could be furloughed. Federal contractors, unlike federal employees, are not guaranteed back pay. During the 2018-2019 shutdown, the Washington Post reported that 10,000 companies with government contracts were affected. Kaine has introduced legislation to provide back pay to contractors and legislation to help federal workers and contractors from falling behind on their bills during a shutdown.

Not only do the losses or changes in work and income for federal employees and government contractors and subcontractors impact regional economies throughout Virginia, furloughs jeopardize their work on national security, inspection of food to ensure it’s free of disease, research into vaccines, helping families in the wake of hurricanes and deadly fires, and administering Social Security and veterans benefits.

Specifically, a government shutdown could harm Virginians in the following ways:

National Security: If the government shuts down, the Department of Defense (DOD) expects to furlough roughly 429,000 civilian Pentagon employees.

Health and Food Safety: If the government shuts down, the Department of Health and Human Services (HHS) expects to furlough about 40 percent of its workforce. HHS oversees the Food and Drug Administration (FDA), which is responsible for food inspections.

• During the 2013 shutdown, nearly 900 food inspections were delayed by the FDA.
• During the 2018-2019 shutdown, the FDA suspended routine food safety inspections. It restored food inspections a few weeks into the funding lapse but only for products that were considered high-risk.

Air Travel Safety: During a government shutdown, air traffic controllers and Transportation Security Administration (TSA) agents are forced to work without pay, which could strain air travel and result in delays. According to the Bureau of Labor Statistics (BLS), there are 1,060 air traffic controllers and 1,710 TSA agents employed in Virginia. Department of Transportation (DOT) Deputy Secretary Polly Trottenberg said that a shutdown would disrupt the FAA’s air traffic controller hiring process, and the FAA Academy would close. This would be especially harmful at a time where Americans are already experiencing air travel delays due to air traffic controller shortages.

• During the 2018-2019 shutdown, the absence of ten air traffic controllers?temporarily stopped travel at LaGuardia Airport and caused delays at several major airports. Many air traffic controllers and TSA agents called out sick because they did not want to work without pay.

Economic Impacts: Recent estimates have found that a government shutdown would reduce GDP by 0.2 percentage points per week, which is the equivalent of more than $50 billion per week.

• The 2018-2019 shutdown resulted in at least $11 billion in economic losses, including a $3 billion permanent economic loss. Researchers at George Mason University (GMU) estimated that the shutdown cost the D.C. region $1.6 billion in economic activity and earnings during the first 25 days of January.

Small Business Loans: A government shutdown prevents the Small Business Administration (SBA) from approving new small business loans or modifying existing loans. So far this year, the SBA has approved 888 loans with a total value of over $451 million to Virginia businesses through the 7(a) program, which is SBA’s primary and most popular loan program.

• Moody’s Analytics estimated that the 2018-2019 shutdown delayed over $2 billion in SBA loans.

Social Security, Medicare, Passports, Tax Refunds, and Other Government Benefits: A government shutdown would suspend the issuance of new or replacement Social Security or Medicare cards. Benefit verifications would also halt. A shutdown could also result in delays to processing applications for passports, tax refunds, and other critical government benefits.

• During the 2018-2019 shutdown, over 26,000 Internal Revenue Service (IRS) employees who were furloughed were recalled to work, but more than half did not show up.
• During the 2013 shutdown, there was a backlog of 1.2 million income and Social Security number verification requests, which resulted in delays to mortgage and other loan approvals as well as billions of dollars of tax refunds.

National Parks: A government shutdown could halt visitor services at National Park Service (NPS) sites and result in the complete closure of NPS sites. Virginia is home to 22 national parks.

• During most government shutdowns, including in 2013, national parks, national monuments, and Smithsonian museums were closed entirely.
• During the 2018-2019 shutdown, many national parks remained open, but no visitor services were provided. Damage, trash build-up, and vandalism were reported at many sites. This caused major damage at many parks and led to serious health and safety concerns for people and wildlife. Many communities located near these sites also suffered losses in revenue due to fewer people visiting these parks.

Environmental Inspections: During the 2013 shutdown, the Environmental Protection Agency (EPA) stopped 1,200 different site inspections for hazardous waste, drinking water, and chemical facilities.

Funding for Federal Formula Grant Programs: Programs that receive federal grants on a monthly basis like Head Start and Temporary Assistance for Needy Families (TANF) would not be awarded funding if the government shutdown lasts through the first of the next month. In 2022, Head Start served 10,591 Virginia children, and 19,237 families in Virginia relied on TANF in a given month.

• During the 2013 shutdown, states were forced to use money from their own budgets to pay TANF benefits.  

Supplemental Nutrition Assistance Program (SNAP) Benefits: During a prolonged government shutdown, the ability to send out SNAP benefits could be halted because the U.S. Department of Agriculture (USDA) is only able to send out benefits for 30 days after a shutdown begins. Stores are also not able to renew Electronic Benefit Transfer (EBT) card licenses during a shutdown; any store whose license expires during a shutdown would not be able to accept SNAP benefits. Approximately 460,000 Virginia families receive SNAP benefits.

Federal Civil Cases: A government shutdown could delay almost all federal civil cases involving the Department of Justice, including discrimination cases, whistleblower cases, disciplinary cases, and retaliation actions against federal employees. It would also further backlog thousands of immigration court cases.

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