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Government Shutdown Latest: What Happens If Federal Agencies Close?

(CBS Detroit) -- The federal government looks to be heading toward another shutdown. The government's fiscal year ends Thursday, September 30, but lawmakers have yet to fund the government or suspend the debt ceiling. If nothing happens before Friday, most federal employees will stop going to work and many Americans could start to see a loss of certain services.

How Does It Come To This?

The government spends more money than it receives in tax revenue. That annual budget deficit is paid for by borrowing additional money. But there is a limit to how much the country can borrow to pay its existing obligations. It's called the debt ceiling. That ceiling is increased or suspended whenever spending approaches its limit, allowing the government to borrow more money and stay open. But without an agreement in Congress, the Treasury Department can't keep paying the federal government's bills.

The debt ceiling was established over a century ago as a way to prevent federal agencies from ignoring Congress's right to control spending. For decades increasing it was a relatively routine event without much fanfare. But the decision has grown increasingly politicized in recent years.

On Monday, Senate Republicans blocked a bill that would have suspended the debt ceiling through December 22 and funded the government through December 3, avoiding a shutdown. The votes fell along party lines, leaving it 10 short of the 60 needed to overcome a filibuster. Reconciliation, which would only require 50 votes plus the Vice President's tiebreaker, is the likely next step.

Should the government fail to raise the debt ceiling, it would soon run the risk of defaulting on its loans. Any default would be the first in the country's history and send tremors across financial markets across the country and the world. Treasury Secretary Janet Yellen told Congress on Tuesday that the federal government would cease to be able to pay its bills on October 18 or thereabouts.

What Services Could See Changes?

If Congress does not raise or suspend the debt limit by midnight Thursday, a full government shutdown would begin Friday morning. Only essential federal employees will report to work that day and every day forward until the limit is raised. Non-essential employees would stop working. The federal government employs about 2.1 million people, not including the Postal Service. And every agency has its own shutdown procedures, so the definition of "essential" varies. In early 2018, when the government experienced a partial shutdown, about 850,000 workers stayed home. The potential scope of a shutdown this year could easily meet or exceed that number.

With every agency executing its own shutdown plan, it's unclear what services will be affected. Drawing from previous experience, it seems possible that national parks will be closed to visitors. Parks were closed during the 2013 shutdown, but some remained open during the 2018-19 shutdown. The National Science Foundation, Fish and Wildlife Service, U.S. Geological Survey, Environmental Protection Agency, and National Institute of Standards and Technology all suspended work three years ago.

Other government work will almost certainly also be delayed The Internal Revenue Service could stop verifying income and Social Security numbers, leading to delays for personal loans. The Federal Housing Administration and Small Business Administration may not be able to process new loan applications either. Parts of the Centers for Disease Control and Prevention and the National Institutes of Health could cease operations, which seems less than ideal during an ongoing pandemic. It's unclear how a shutdown would affect clinical trials of the COVID vaccine for children ages 5-12.

What About Essential Services?

Employees deemed essential must continue to report to work without pay. Based on past shutdowns, plenty of services that millions rely on should continue in the short-term. That includes border protection, air traffic control, law enforcement, and power grid maintenance. Mail will continue to arrive, because the postal service funds itself rather than relying on federal tax dollars. Social security checks and food stamps will also continue to arrive.

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