Bloomberg Audio Studios, podcasts, radio news.
The US is now on day thirty seven of its longest government shutdown ever.
Food banks around the country are seeing increased demand as people look to replace federal food benefits that were cut off.
Tens of thousands of additional federal workers have joined hundreds of thousands already furlough.
President Trump's Transportation Secretary Sean Duffy announcing the FAA will cut flight capacity by ten percent, which experts say means thousands of flights will be canceled.
The longer it goes on. And we see this in the polling that the numbers creep up in terms of number of Americans who say that this shutdown is impacting them personally.
Bloomberg's White House reporter Gregory Cordy.
And that's because there's a lot of monthly things that the government does. If you're renewing a passport, if you rely on any kind of assistance over time, you're going to start to notice that your government's not responsive to your needs.
Certainly, we are coming up against to the Thanksgiving holiday and just a few weeks.
Here, Bloomberg's Congress editor Megan Scully.
And we're seeing flight delays due to groundstops because of staffing shortages, particularly among air traffic controllers. Food prices have been a problem for many Americans now for the last several years, and with the shutdown comes uncertainty about the immediate future of snap benefits.
Every shutdown is a little different. We and Washington have gotten used to this as a symptom of our political dysfunction, and to some extent, there's a script. But every shutdown, the political context is different, the timing is different. The government just does different things at different times of the year, and so yeah, leading into the holidays, and with the background of this affordability crisis, it's a perfect storm of issues all coming together with this shutdown.
I'm Sarah Holder, and this is the big take from Bloomberg News Today on the show, the longest government shutdown in American history, Who it's impacting most, and what it means for the economy long term. The US's prolonged shutdown started on October first, after negotiations over the government's spending package broke down. Democrats couldn't get Republicans to agree to include subsidies for Affordable Care Act healthcare plans in the bill.
Without them, the average healthcare premium is expected to double. And as the weeks have dragged on, the consequences of the shutdown and the stakes of reopening have become more and more urgent.
Without a federal budget to pay for a whole variety of programs, One of the casualties of that is the Food Assistance program.
That's my colleague Gregory Cordy, who covers the White House and the Budget.
Formerly we knew as for food stamps. Now we call it SNAP, And as we get into the second month of the shutdown, the benefits well is running dry. This foodstamp program is funded on a month to month basis, but it costs about eight billion dollars eight or nine to fund food stamps for a month.
SNAP has only been funded through October, and Bloomberg's Congress editor Megan Scully says the question of what happens to SNAP funding in November has been at the center of an ongoing legal fight.
We've really seen Trump's priorities here. He has been very free with moving money to pay for military salaries, to pay for our salaries for law enforcement. But he went to court to fight against moving money out of the contingency Fund to pay for SNAP. Particularly the SNAP fight has been interesting given that this administration, particularly the White House Budget Office, has been extremely aggressive about asserting the
power of the purse, which is really Congress's domain. But we saw with a SNAP fight for them, they really took a step back and said, no, we cannot legally move these funds until they were ordered by a federal judge to do so.
The federal judge ordered the Trump administration to dip into the USDA's contingency fund to cover SNAP benefits, but the Trump administration says that money isn't enough to cover all of the forty two million people who rely on the
program each month. In a court filing late Wednesday night, lawyers for the Department of Justice said they could only cover two thirds of recipient's benefits for November, But on Thursday, a federal judge in Rhode Island issued a new order saying the Trump administration has to find a way to pay out the full amount. Food access isn't the only
thing that could be disrupted by the shutdown. As government employees across the country go without pay or are furloughed, it becomes harder and harder to pay bills like rents and mortgages. Given the length of the disruption, Gregory's team has been watching for signals that evictions or foreclosures could be on the horizon.
Usually it takes sixty to ninety days for an eviction to work its way through whatever local process there is from state to state. But we've seen things like federal agencies give letters to their employees that they can then take to their mortgage company or their landlord saying, please excuse this federal employee from having to pay their rent this month because we're in the middle of a shutdown.
Of course, that letter has no legal bearing. Your bank or your landlord is under no legal obligation to honor what's essentially an IOU from the federal government. We're going to pay this employee when the shutdown ends, Can you
please let them slide on their rent? Those are the kinds of things as the shutdown continues that federal employees are feeling the strain, and of course that reverberates through the federal government as absenteeism rates go up from federal employees, many of whom are doing essential functions but have to juggle childcare and rent and other things in their daily lives because they're not getting paid.
Those apps and tea rates can have a huge impact on one sector, in particular, air travel. When the government is shut down, workers under the Federal Aviation Administration, like air traffic controllers, have to work without pay, so do Transportation Security Administration workers TSA agents.
We are seeing their apps and tee rates begin to tick up, resulting in flight delays and groundholds at airports around the country. Just last week, when the Senate was leaving town for a long weekend, the air traffic controllers at Reagan National Airport, the airport that most Senators used
to leave DC, the closest airport to downtown Washington. Several air traffic controllers did not show up to work, and they had to do a ground stop, delaying traffic out of DC and delaying the center's ability to go home.
With Thanksgiving only a few weeks away, a holiday where millions of Americans fly, the prospect of snarled airports and stranded tray travelers is another factor that could push Congress toward a shutdown resolution. On Tuesday, Transportation Secretary Sean Duffy, stuck with the White House's position, blaming Democrats for the shutdown, and he warned that soon things could get even worse.
So if you bring us to a week from today, Democrats, you will see mass chaos. You will see mass flight delays, you'll see mass cancelations, and you may see us close certain parts of the airspace because we just cannot manage it, because we don't have air traffic.
Then, on Wednesday, Duffy announced that the FAA would order airlines across forty major US airports to cut their flight capacity by ten percent, set to start on Friday. Airlines have started publishing updates about possible cancelations on their websites. So, with pressure mounting, what could get Congress to agree on a reopening plan, And even after the government shutdown ends, what could the lingering economic consequences be. That's after the break.
We're nearing the close of the thirty seventh day of the US government shutdown. Every day it continues, Congress is under more and more pressure to come to a compromise that would end it. Tuesday's elections around the country swung in Democrats' favor, which some Republicans took as a signal
that the shutdown could have lasting political consequences. Trump has repeatedly called for abolishing the filibuster in the Senate, an extreme move that would allow Republicans to force through a partisan budget on a simple majority vote, But Republicans in the Senate are wary of how Democrats could leverage that in the future and don't seem to have an appetite
to do it. My colleagues, Congress editor Megen Scully and White House reporter Gregory Corre, have been at the White House and at the Capitol looking for signs of when the stalemate might thaw. Here's Megan on the state of play.
I think what we're seeing now is, particularly in the Senate, we are seeing some softening among Senate Democrats on the hardline that they've taken on the shutdown. They had demanded that Affordable Care Act subsidies be addressed before they would vote to reopen the government. There are some moderates who are in talks with Republicans who are saying, just give us the promise of a vote down the road. Any kind of bipartisan deal has not come out yet, has
not come to the floor. We're paying attention to the Senate right now because the Senate has the filibuster still in place, which we've heard President Trump certainly complain about in recent days. But that means that at least eight Senate Democrats need to sign on to this stopgap spending bill to get it through that chamber. It cannot pass as of right now on a simple majority.
Can you characterize the Democrats' strategy versus the republicans strategy right now? Gregory? How are each side of the aisle sort of thinking about ending the shutdown?
Well, I think both sides are keeping a close eye on the polling on this, which has favorite Democrats. If you look at the history of the modern shutdown back through the gingrid shutdowns of the nineties, generally voters view Republicans as the aggressors on these shutdowns, even if the shoes on the other foot, And so the pulling this time around shows maybe a slightly narrower difference between the two parties, but that voters blame Republicans more than Democrats.
So Democrats have that at their backs. They also have the elections this week, which they did very well on up and down the ballot.
And do you think the shutdown and the chaos at the federal government level had anything to do with those wins.
President Trump certainly thinks so. He was out very early even on election night, blaming the shutdown for what happened. But I think both sides are taking stocks their wins and losses and trying to see if there is a new way forward on this that will require both sides to swallow a little bit of their pride and look, compromise is a dirty word in Washington these days. It gets harder and harder to do these deals with each successive shutdown, with each successive.
Budget fight, each shutdown is different. And aside from the length of this shutdown, what has struck me about this is the lack of negotiations. Each day in the capital. We've gotten into a routine where Speaker Johnson has a ten o'clock press conference, Hakem. Jeffreys has one, a little while later, Chuck Schumer has one, John Thune has one. We're seeing letters being sent in the actual mail to
people who work down the hall from each other. They're talking to the press, they're reiterating talking points over and over and throughout the day, but they're not talking to each other at all.
There used to be not that long ago. These gangs of senators right that would work across the island. There would be a gang of eight or a gang of six, or or whatever number they needed to find the middle ground to reach a compromise. And that just doesn't happen anymore.
On Thursday, House Speaker Mike Johnson said he's not optimistic about a quick end to the shutdown. Senate Democrats, emboldened by Tuesday's election results, spent much of the morning hunkered down in Chuck Schumer's capital office weighing their own next steps. But whenever the shutdown does end, things won't go back to normal overnight.
When the shutdown ends. Whenever it ends, be that this week or Thanksgiving or the end of the year, or whenever, the question is going to be what starts back up again in what has been dormant for so long during the shutdown that we might not see it ever come back.
So typically during a government shutdown, we lose about fifteen billion dollars a week is the sort of agreed upon general estimate that is typically recovered though the end of the shutdown, when all federal employees, including those who are essential and furloughed, get their back pay. And they can pay their bills, and they can do their Christmas shopping and all of that. Typically, not everything, but most economic activity is recovered. What's different about this one? There are
a few things that are different about this one. One, Trump has threatened not to pay furloughed federal employees back, which has created a level of uncertainty among that population of people. The other one is lingering concerns about long term layoffs and what happens. So far, the layoffs have
been targeted and have been relatively small. But this comes on the heels of cuts made by Elon Musk's Doge Group earlier this year, by federal employees who have chosen to quote take the fork and received essentially a buyout for resigning their positions. It's just one more layer of complexity to this workforce.
Certainly, I think what the Trump administration has already done is looked at what areas that Congress hasn't funded and said, okay, look, if Congress has determined that these aren't things that we really have to do during a shutdown, then maybe we don't have to do them. Ever.
But in addition to the federal workforce, you have forty two million Americans who get snap benefits who are financially constrained more so than usual during the shutdown. And then you have another twenty four million Americans who are getting notices now and have to decide whether or not to continue their Affordable Care Act insurance into next year. So there is a tremendous amount of uncertainty. And this is not a small portion of the population. It's a pretty big swath of the US economy.
Measuring the true economic impacts of the shutdown and its aftermath will pose its own challenge. The agencies that collect economic statistical data have also gone dark. September reports went out, but no October data has been collected or shared.
We've already missed a month's worth of price data. We are missing employment data. We might be able to fill in the gaps of some of those going backwards. It's really hard to collect prices if you're not doing it in real time. The Census Bureau is almost entirely shut down. So not only is this shut down impacting basic government services, but it's also creating a huge hole in our knowledge
of exactly what the state of the economy is. And many of these statistics will take years to sort of recover and find its new baseline, and along with the Trump administration's cuts to statistical agencies, again, some of those statistics that we take for granted here at Boomberg may never come back.
I pose the hardest question to Megan. She's covered Congress for years, so I asked her when she thinks the shutdown might end.
I think we are starting to see some early shoots of compromise that could bring an end to this shutdown by the middle of next week. That will require not just a deal in the Senate, but Mike Johnson agreeing to whatever the Senate decides and bringing those four hundred and thirty five members back to Washington to vote, and of course Donald Trump agreeing to the deal as well. But I should also note that even when we get to the end of this shutdown, the clock is just
starting to what might be the next shutdown. We're looking at delaying this debate over federal appropriations into December or January, not indefinitely, so there will be celebration when the government reopens and federal workers are paid and TSA and air traffic controllers are fully staffed. But we could be going through this all over again in just a month or two.
Wow. So this government shutdown is the longest in history, but it might not be the.
Last, certainly not.
This is the Big Take from Bloomberg News. I'm Sarah Holder. To get more from The Big Take and unlimited access to all of Bloomberg dot com, subscribe today at Bloomberg dot com slash podcast offer. If you liked this episode, make sure to follow and review The Big Take wherever you listen to podcasts. It helps people find the show. Thanks for listening. We'll be back tomorrow.