Ones and Tooze The U.S. Government Shutdown
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Oct 10, 2025 Government shutdowns reveal the complexities of the American budgetary system. Key discussions highlight which services and workers are affected, such as furloughed staff and the economic damage linked to GDP and market uncertainty. The hosts delve into how the shutdown complicates Federal Reserve decisions due to halted data. They also explore the implications for national debt, fiscal politics influenced by U.S. dollar privilege, and the challenges states face in covering federal funding cuts. The potential for a constitutional crisis and the risks of executive power expansion are also examined.
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Who Feels The Shutdown First
- The shutdown suspends guaranteed funding for discretionary agencies and affects many who either work unpaid or are furloughed.
- Roughly 750,000 federal workers face furloughs or unpaid work, varying widely by agency.
Treat Missing Data As A Signal
- Monitor official data releases closely during a shutdown and treat missing series as signals, not errors.
- Adjust policy and market expectations when statistical agencies pause, and factor that uncertainty into decisions.
Shutdown Stops Data And Worries Markets
- Markets fear lost data and policy paralysis as key statistical agencies pause.
- JP Morgan and S&P estimate a 0.1–0.2% GDP annualized hit per closed week, amplifying uncertainty.
