As the US Senate failed to pass the federal government temporary appropriation bill, the non-core departments of the federal government were forced to close temporarily from 00:00 on the 20th. This is another "shutdown" of the US federal government since October 2013.

What is the shutdown of the non-core departments of the US federal government?

Federal departments in the United States usually require Congress to allocate funds for the fiscal year to maintain operations. The federal government has been operating on a temporary appropriation bill for the past few months because the Democratic and Republican parties have failed to agree on specific spending plans for each federal department before the start of the 2018 fiscal year. The latest temporary appropriation bill only provides federal funds for operation until the 19th of this month.

As the Senate failed to pass the new temporary appropriation bill in time, the government could not get office funds, and the White House could only temporarily close non-core departments, but the core departments such as the military, border defense, fire protection, and public safety were not affected, and the post office continued to be opened. the police are on duty as usual, social insurance benefits for retirees are distributed as usual, and the lives of ordinary people are not greatly affected.

White House Office of Management and Budget Director Mick Malvani said that in order to learn from the lessons of the last federal government shutdown, the Trump administration will ensure that tourist attractions such as national parks remain open to minimize the impact on public life. However, government employees in non-core departments must go home for leave and wages are suspended.

It is not uncommon in history for the US federal government to shut down because of the political game between the two parties. According to the Congressional Research Service, there have been 19 long or short government shutdowns in the federal government since 1977. In 2013, some conservative Republican lawmakers blocked the implementation of Obamacare, resulting in a 16-day "shutdown" of the federal government, during which about 850000 federal employees were forced to take unpaid leave. Environmental assessment, import and export license applications and other federal government operations have been delayed.

Why doesn't the U.S. Congress approve government funding?

Although Republicans currently control the majority of seats in the White House and both houses of Congress, Republicans have only 51 seats in the Senate, while the Senate needs 60 votes to pass the government appropriations bill, which means that the bill cannot be passed without the support of Democratic senators.

Democrats are not opposed to funding the federal government to maintain operations, but most Democratic senators want to tie legislation to the government appropriation bill to protect the suspended repatriation (DACA) program for childhood arrivals. The Republican leadership rejected the proposal, arguing that the two issues should be negotiated separately.

The suspended repatriation of childhood arrivals, signed by former US President Barack Obama in 2012, allows illegal teenage immigrants brought into the United States by their parents when they are young to avoid being repatriated and legally get a job. The current US President Donald Trump ordered the repeal of the plan last September and suspended its implementation for six months so that Congress could seek an alternative policy, which is expected to affect about 800000 young illegal immigrants. Trump held talks with leaders of both parties in Congress last week on immigration reform, but failed to reach an agreement.

Senior leaders of both parties hope to use the government shutdown to express their attitude towards immigration reform to their core voters, while blaming each other's parties, so as to seek a greater electoral advantage in the mid-term congressional elections in November.

How long will the storm of "closing the door" last?

The shutdown could last for hours, days or weeks, depending on the outcome of bipartisan negotiations. According to US media, some lawmakers have proposed a new three-week government funding plan, and the Senate and House of Representatives will vote on it as early as the 20th. Analysts believe that with the extension of the "shutdown" of the government, public grievances will grow, and public pressure will eventually force the two parties in Congress to reach a compromise.

Malvani said in an interview on the 19th that he expects the two parties to reach an agreement within the next 24 hours to ensure that the federal government can be fully operational by next Monday. He said Trump has temporarily cancelled his trip to Sea Lake Manor in Florida this weekend to celebrate his first anniversary in office, but has stayed in Washington to help resolve the government shutdown.

What is the impact of the "shutdown" incident on the US economy and financial markets?

The "shutdown" of the US federal government usually does not last long and mainly involves non-core sectors, so economists generally believe that it will not have much impact on the US economy. The U.S. Department of Commerce estimates that the federal shutdown in October 2013 led to a 6.6% drop in federal spending in the fourth quarter of that year. The US economic growth rate fell by 0.3 percentage points in the quarter, but it could not all be attributed to the "shutdown".

Alec Phillips, an analyst at Goldman Sachs Group Group, predicts that if the government shutdown lasts for a week, it will reduce US economic growth by 0.2 percentage points in the first quarter of this year, but will make up for these losses in the second quarter. He believes that the impact of the government shutdown on financial markets will also be mild, especially given that the US is still quite some time away from reaching the government debt ceiling, and financial markets will react more calmly.

What is the impact of the "closing the door" incident on American diplomacy?

In a conference call with reporters, US government officials said that even if the federal government shuts down, Trump's trip to Switzerland for the World Economic Forum next week will not be affected. According to US media, the Office of the United States Trade Representative will also send personnel to participate in the sixth round of negotiations to update the North American Free Trade Agreement, which began in Montreal, Canada, on the 23rd of this month, but the size of the US delegation may be smaller than usual.

If the US federal government "shuts down" for a long time, it will bring a lot of inconvenience to the US government's trade negotiations and foreign exchanges. After the federal government shutdown in 2013, the Office of the United States Trade Representative temporarily cancelled the second round of negotiations on the US-EU trade and investment partnership due to a lack of travel funds and manpower constraints.