How Much Is the Government Shutdown Costing American Taxpayers?

Shutdown costs will soon exceed the wall funding itself.
  • Trump’s demand for border wall funding has led to a shutdown of the federal government.
  • Lasting now for over four weeks, it’s the longest shutdowns in American history.
  • The cost of Trump’s government shutdown already exceeds several billion dollars, according to some estimates.

As if the stock market downturn at the end of 2018 wasn’t bad enough, American finances were hit with another headwind in December; this time from the government. On Dec. 22, the federal government officially entered a partial shutdown due to an impasse reached in Congress regarding $5 billion President Donald Trump asked for in funding to begin building a border wall. Refusing to back down, Trump vowed after the shutdown began to keep the government closed “months or even years” until funding is secured.

The current federal government shutdown is one of a handful of shutdowns that have occurred since the 1970s. Here’s a look at the most expensive government shutdowns, and details on how much the current could cost the country.

Most Expensive Government Shutdowns in History

In 1980, the Carter administration oversaw a federal shutdown, although it was limited to just the Federal Trade Commission for one day, May 1, 1980. The first real federal shutdown — meaning one that significantly limited federal government functions — occurred in 1981 during the presidency of Ronald Reagan.

Major shutdowns are ones in which government workers are furloughed, or sent home from work. Reagan furloughed 241,000 federal employees in November 1981. Three years later, in his second major shutdown, approximately 500,000 federal employees were sent home from work.

Find Out: Why the Government Shutdown Is Bad News for Your Tax Refund

Here’s a breakdown of past major federal government shutdowns since 1981 and their costs, both then and adjusted to inflation:

Dates of ShutdownCost of ShutdownAdjusted for InflationPresident at Time
Nov. 20-23, 1981$80 million – $90 million$215.19 million – $242.09 millionRonald Reagan
Oct. 3-5, 1984$65 million$155.58 millionRonald Reagan
Oct. 16-18, 1986$62 million$141.67 millionRonald Reagan
Oct. 5-9, 1990$2.6 million$4.9 millionGeorge H.W. Bush
Nov. 13-19, 1995; Dec. 5, 1995 to Jan. 6, 1996$1.4 billion$2.29 billionBill Clinton
Oct. 1-17, 2013$2 billion$2.16 billionBarack Obama

Federal government shutdowns became much costlier after 1990, lasting sometimes for weeks rather than days like in the past. The two shutdowns under President Clinton lasted for about a month in total. The federal shutdown under President Obama lasted just over two weeks.

Potential Cost of Trump’s Government Shutdown: $8.7 Billion or More

The economic cost of Trump’s federal government shutdown could already total more than $5 billion, according to some analysts’ estimates, Money magazine reported. Taking into account lost wages, productivity and impact on the economy at large, if the shutdown lasts until the end of January it will cost as much as $8.7 billion, according to a forecast by Moody’s Analytics economist Mark Zandi. Other analysts put the potential costs even higher. A year ago, Standard & Poors calculated that a shutdown would cost roughly $6.5 billion a week.

The current shutdown is already among the most expensive government shutdowns in history. The approximate cost is based on several calculations: 800,000 workers are affected, with 380,000 employees furloughed, according to Yahoo Finance. And based on an average government salary of about $90,000 for federal civilian workers, the shutdown costs American taxpayers roughly $712.5 million per week. With the current shutdown crossing into its second week, the cost now stands at $1.4 billion.

In addition to the 380,000 not working, there are 420,000 employees working without pay. A recent lawsuit won by a federal employee union required the government to compensate employees twice the amount of their back pay. Should the same compensation be required this time around, the shutdown would cost another $787.5 million per week, or about $1.6 billion at this point. The combined cost of furloughed employees and reimbursing workers without pay comes to $3 billion.

Find Out Why: You Have a Higher Net Worth Than the US Government

Origins of Federal Government Shutdown

Branches of the government have disagreed on budgets as long as the U.S. has existed. Yet federal government shutdowns are actually a fairly recent historical phenomenon.

That’s because they trace their origins to the Congressional Budget Act of 1974, which created standing budget committees in the House and Senate that were required to pass a “concurrent budget resolution” by a specified date. Between 1980 and 1981, Attorney General Benjamin Civiletti gave the government shutdown its modern form, stating that when Congress fails to provide funds for ongoing government functions, then there must be a full or partial shutdown of government agencies.

Keep reading to see why Trump’s tariffs are killing more than 450,000 jobs.

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