The nearly monthlong government shutdown will cost the United States between $7 billion and $14 billion, according to a new report released Wednesday by the Congressional Budget Office (CBO).
Depending on the length of the shutdown, the CBO estimates that the shutdown will reduce real gross domestic product growth between 1 to 2 percentage points. While the shutdown will also delay federal spending, any negative ramifications should reverse once the shutdown is over.
The report, written by CBO Director Phillip Swagel to House Budget Chair Jodey Arrington (R-Texas), stated that the real effect that the shutdown could have on the economy is uncertain. Any impacts “depend on decisions made by the Administration throughout the shutdown.”
Were the government to reopen on Wednesday, the economy would have lost $7 billion by the end of 2026. Should the shutdown end around Nov. 12, after six weeks, the economic loss would reach $11 million. If the shutdown lasts until the end of November, $14 billion could be lost.
The report maps out another looming outcome of the shutdown. Supplemental Nutrition Assistance Program (SNAP) benefits will be fully paid for October but will not be issued as of Saturday.
“Because of the uncertainty, CBO’s analysis incorporates a 50 percent probability that SNAP benefits will be paid after October 31 if the shutdown continues beyond that date,” the report stated. “CBO’s analysis also incorporates the expectation that when the lapse in funding is over, missed SNAP benefits will be paid.”
The CBO also noted that the country’s unemployment rate will rise as federal workers remain furloughed, but this should decrease once the government reopened and federal employees return to work.
Following the report’s release, Arrington slammed Democrats for “playing politics.”
“Even the independent, nonpartisan Congressional Budget Office confirmed the economy will lose 1% in growth because of the Schumer shutdown,” Arrington said in a statement, referring to Senate Minority Leader Chuck Schumer (D-N.Y.). “For hardworking families that means higher unemployment, lower wages, and less money in their pockets.”
Arrington said Democrats this Halloween are “all trick and no treat.”
The report’s release comes as Senate Democrats plan to introduce legislation to pay for and extend funding for the Special Supplemental Nutrition Program for Women, Infants and Children (WIC), which provides essential nutrition assistance for lower income mothers.
But Schumer and other Democrats argue that they and President Trump need to negotiate over the upcoming expiration of Affordable Care Act (ACA) tax credits.
