The US government last night failed to reach an agreement over the budget , and while I still fail to understand the political side to it, it is clear that there will be large economics implications to this. Over 800,000 public sector workers now face unpaid leave for the foreseeable future. It is estimated that the shutdown will cost the US economy $300m a day, with the last shutdown in 1996 costing $96bn for a 21 day closure. There are fears that this is going to halt the economic recovery, with around 0.9% of GDP being lost for this quarter from the shutdown. The large slowdown will partially come from lack of consumption from the many workers who no longer have an income , and thus do not spend at local restaurants and businesses. Furthermore, investment will fall as people become wary of economics stability and confidence int he country falls. Tourism revenues are expected to take a hit as attractions such as the Statue of Liberty, museums, zoos and many national parks will close. It is unknown how long this this "shutdown" will last but the longer it does, the more damage that will be down to the US economy,
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Tuesday, 1 October 2013
Sorry We're Closed!
So this morning I woke up to here the breaking news that " The US government has Shut Down" on the radio, and was shocked and confused to how such a thing could happen. But after doing some research, apparently it isn't as catastrophic as it sounds and to my surprise has happened before.
The US government last night failed to reach an agreement over the budget , and while I still fail to understand the political side to it, it is clear that there will be large economics implications to this. Over 800,000 public sector workers now face unpaid leave for the foreseeable future. It is estimated that the shutdown will cost the US economy $300m a day, with the last shutdown in 1996 costing $96bn for a 21 day closure. There are fears that this is going to halt the economic recovery, with around 0.9% of GDP being lost for this quarter from the shutdown. The large slowdown will partially come from lack of consumption from the many workers who no longer have an income , and thus do not spend at local restaurants and businesses. Furthermore, investment will fall as people become wary of economics stability and confidence int he country falls. Tourism revenues are expected to take a hit as attractions such as the Statue of Liberty, museums, zoos and many national parks will close. It is unknown how long this this "shutdown" will last but the longer it does, the more damage that will be down to the US economy,
The US government last night failed to reach an agreement over the budget , and while I still fail to understand the political side to it, it is clear that there will be large economics implications to this. Over 800,000 public sector workers now face unpaid leave for the foreseeable future. It is estimated that the shutdown will cost the US economy $300m a day, with the last shutdown in 1996 costing $96bn for a 21 day closure. There are fears that this is going to halt the economic recovery, with around 0.9% of GDP being lost for this quarter from the shutdown. The large slowdown will partially come from lack of consumption from the many workers who no longer have an income , and thus do not spend at local restaurants and businesses. Furthermore, investment will fall as people become wary of economics stability and confidence int he country falls. Tourism revenues are expected to take a hit as attractions such as the Statue of Liberty, museums, zoos and many national parks will close. It is unknown how long this this "shutdown" will last but the longer it does, the more damage that will be down to the US economy,
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