The Speaker of the House of Representatives stated that a federal government shutdown in the United States was 'inevitable' and targeted Chuck Schumer
The Speaker of the House defended that Republicans will return to Congress next week, although Democrats criticized them for leaving Washington in the midst of a budget crisis. Johnson, in response, assured: "There won't be much activity until we reopen the doors of the government."
The legislator also questioned Schumer for granting the White House "unilateral authority" to determine which programs continue and which could be eliminated.
The United States entered a federal government shutdown after Democrats and Republicans failed to reach a consensus on funding. The Speaker of the House, Mike Johnson, had anticipated that the shutdown was "inevitable" and directly blamed Senate Minority Leader Chuck Schumer for not supporting the funding proposal put forward by Republicans.
"I believe it's inevitable now. There's nothing to negotiate," Johnson declared, ruling out any kind of dialogue while the government remains closed.
The Republican legislator insisted that responsibility lies with the Democrats: "The only question tonight is how long will Chuck Schumer keep the government closed?"
With the start of the shutdown, federal agencies began to run out of funds at 12:01 a.m. on Wednesday. Among the most immediate effects are:
Johnson warned that the administration will have to make "very difficult decisions" about which services are considered essential and which are not.
The shutdown may delay the release of key data such as the employment figures scheduled for October 3, as well as statistics on inflation and wages, critical information for the Federal Reserve in its decision on interest rates.
Government shutdowns are not new in American politics. The longest occurred between 2018 and 2019, when it lasted for 35 days, reducing GDP by 0.02% and temporarily leaving more than 800,000 federal employees without pay.
This time, it is estimated that 900,000 non-essential federal workers will be furloughed, which could impact employment and short-term economic growth.
In financial markets, shutdowns usually have limited effects. During the 2018-2019 shutdown, the S&P 500 quickly recovered and closed 10% above its initial level. However, analysts such as Goldman Sachs warn that the dollar tends to weaken after these episodes, which could generate additional volatility in the current economic and political scenario.
