Chairman Yarmuth, Rep. O’Halleran Respond to New CBO Report on Cost of Trump Shutdown
WASHINGTON, D.C. — House Budget Committee Chairman John Yarmuth (KY-03) and Congressman Tom O’Halleran (AZ-01), Co-Chair of the House Blue Dog Coalition, today responded to a new report from the Congressional Budget Office on the $11 billion cost of the Trump shutdown. According to CBO, the level of real GDP in the fourth quarter of 2018 was reduced by 0.1 percent ($3 billion), and the level of real GDP in the first quarter of 2019 is expected to be reduced by 0.2 percent ($8 billion).
Yarmuth and O’Halleran wrote to CBO Director Keith Hall requesting this estimate last week.
"The CBO confirms that the Trump shutdown had a debilitating effect on our entire economy, and if it were to resume in three weeks, millions of Americans would again share the pain of the 800,000 workers who spent the past month without a paycheck,” said Chairman Yarmuth. “I am hopeful that we have finally reached a turning point with these mindless shutdowns, but this CBO estimate serves as a stark warning to President Trump on the consequences of using American workers as a bargaining chip.”
“There is no reason the greatest country in the world could not keep its government open; this reckless shutdown, which lasted 35 days too long, was shameful and hurt the American people,” said Rep. O’Halleran. “The CBO report, which we requested last week, shows that our economy needlessly suffered because partisan gridlock is a greater priority to this Administration than actual governing. Thousands of Arizona families and hundreds of thousands more across the country went more than a month without being paid, struggling to make ends meet and put food on the table. They are tired of being pawns in this political game. We need to make sure that a shutdown never happens again.”
CBO’s estimate is based on the loss of furloughed federal workers’ contributions to GDP, the delay in federal spending on goods and services, and the reduction in aggregate demand. It does not incorporate more indirect negatives effects of the shutdown, such as small businesses facing reduced access to loans and postponements in hiring and investment decisions. CBO also finds that the negative effects of the shutdown would have grown increasingly worse had it continued.