The U.S. federal government is on track for a partial shutdown if lawmakers fail to take action before September 30. While the stock market has historically been unaffected, workers' paychecks, as well as environmental and food inspections, are at risk.

Uncertainty Surrounds Funding Bill

With just over two weeks remaining before funding expires, House Speaker Kevin McCarthy has suggested a short-term funding bill to keep the government open. However, there is no consensus on this approach. Some House Republicans are advocating for lower spending targets in the upcoming fiscal year compared to the agreement McCarthy reached with President Joe Biden in a debt-ceiling deal. The new fiscal year begins on October 1.

Impact on National Parks and Government Agencies

A government shutdown could disrupt visitor services at national parks and cause delays in passport applications. Additionally, employees at agencies like the Securities and Exchange Commission may be instructed not to report to work. On the other hand, certain functions would continue unaffected, including the payment of Social Security and Medicare benefits.

Social Security and Medicare Benefits Persist

Despite a potential shutdown, Social Security and Medicare benefits would still be issued. However, it is worth noting that services provided by Social Security offices might be limited. Additionally, the U.S. Treasury would be able to make timely interest payments on Treasury debt.

As the deadline approaches, it remains to be seen how lawmakers will resolve the funding issue and whether a partial shutdown can be averted.

National parks

During the 35-day shutdown from December 2018 to January 2019, national parks across the United States faced significant challenges. Although many of them remained open, they operated without sufficient staff, and conservationists expressed concerns over the potential long-term damage to these sensitive lands. The shutdown also forced the closure of renowned institutions such as the Smithsonian museums and the National Zoo in Washington.

Federal-worker furloughs

As a result of the shutdown, numerous federal workers were deemed "non-essential" and faced furloughs without pay. While some essential personnel, including military personnel, prison guards, and border-security agents, had to continue working, the majority of employees were left with no income. However, historically, furloughed workers have been entitled to receive back pay once the government resumes its operations.

Impact on economic data

Another consequence of a government shutdown is the potential delay in the release of crucial economic data. Investors closely analyze these reports, and any disruptions to their timely availability can have significant implications. For instance, due to the 2019 shutdown, a reading on gross domestic product was delayed by a month, not being released until February that year.

Disrupted food and environmental inspections

Shutdowns also disrupt essential inspections for food safety and environmental regulations. In 2013, during a previous government shutdown, the Environmental Protection Agency was unable to conduct site inspections for 1,200 locations. These inspections play a vital role in ensuring the safety of hazardous waste sites and drinking water sources. Therefore, any interruption in these inspections poses potential risks to public health and the environment.

U.S. mail services

Despite the government shutdown, Americans would still receive their mail, including cards, letters, and packages. The United States Postal Service operates independently and does not rely on tax dollars for funding. Instead, it supports itself through the sale of its products and services.

Read next: The government shutdown is ending, after becoming the longest on record — by a wide margin

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