There has not been a government shutdown for 17 years. Last time, it took the federal government two weeks to end the shutdown. Again, public services are suspended. On October 1, 2013 the US fiscal period began without a continuing resolution or regular appropriations. Political conflicts between Democrats and Republicans caused this circumstance: both parties could not agree on a spending plan. The Republicans offered to back down in case the new health care reform Obamacare was suspended for one year. The Democrats rejected this proposal, setting a stage for the shutdown. About 800.000 federal employees were furloughed without pay, only essential government functions are performed. 

The administration has been downsized to a minimum, if at all. Passports cannot be renewed, the Statue of Liberty as well as most national parks are closed, press offices are not hold, even the Twitter account of the parliament is not active. The Shutdown does not only concern the US population, it also affects international tourists. 

Time is short. Possible consequences of international scope could be fatal. According to the treasury secretary, the USA’s official debt ceiling will be reached on October 7, 2013, provided that no compromise will be made or the debt ceiling will be raised. The national illiquidity would impend, affecting the national and international business activity. International financial markets would collapse, a slump would lead to extensive financial penalties.

Author: Anja Rettig Legal Trainee BridgehouseLaw Charlotte

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