White House issues shutdown order as cash authority expires

01 October 2013 16:05  [Source: ICIS news]

WASHINGTON (ICIS)--The White House early on Tuesday issued orders to federal departments and agencies to begin a partial shutdown of operations after a late-night session of Congress failed to find common ground on funding the government.

The government’s legislative authority to spend money expired at midnight Eastern Time on Monday night, forcing Washington to begin furloughs for approximately 800,000 “non-essential” federal employees across the country.

Those non-essential workers make up about 38% of the 2.1m-strong federal workforce.

As the spending authority expired, the White House Office of Management and Budget (OMB) issued a memo to the directors of all federal departments and agencies saying that they “should now execute plans for an orderly shutdown”.

OMB director Sylvia Burwell said that even with only non-essential workers being furloughed, “critical public services and programmes will be impacted”.

In anticipation of the shutdown, earlier this month Burwell circulated detailed plans by each department and agency on what level and number of employees would be furloughed and what operations would be curtailed.

The partial shutdown developed because Republicans in the House - where constitutional spending authority resides - wanted to continue federal spending with what is called a continuing resolution (CR), a stop-gap measure that would provide authority for federal outlays at current levels for a brief period.

However, House Republicans added language to the CR that would either defund or delay for a year President Barack Obama’s signature healthcare policy, the Patient Protection and Affordable Care Act (ACA, also known as ObamaCare), which was passed by Congress in 2010 and becomes effective on Tuesday.

The Democrat-majority Senate overnight rejected at least two House measures aimed at undermining ACA, and the White House has said that Obama in any event would veto a bill out of Congress that defunds or otherwise restricts the ACA.

US manufacturing interests have warned that if the partial shutdown continues for a prolonged period, longer than a week or two, it could have profound impact on the overall US economy.

Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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