Trump’s Top Economic Adviser Says Shutdown Won’t Affect Economy
The partial government shutdown initiated after Democrats refused to fund President Donald Trump’s $5.7 billion border wall will not significantly impact the economy, according to a top Trump economic advisor.
Kevin Hassett, chairman of the Council of Economic Advisers, told reporters Wednesday that some federal employees may miss a payday because of the government shutdown. Any overall impact on the economy would be minimal after the furloughed workers receive backpay after Congress passes a spending bill.
Hassett says partial Government shutdown of a few weeks would not have a significant impact on the economy. Cites Congressional Research Service records showing furloughed Govenment workers end up getting paid, though might miss a pay period.
— Mark Knoller (@markknoller) December 26, 2018
The federal government went into a partial shutdown Friday night at midnight after Congress failed to come to a consensus on a spending bill. House Republicans passed a version of a spending bill that included $5.7 billion border wall between the U.S. and Mexico. The bill died in the Senate after Democrats largely refused to support it.
Recent volatility in the stock market has led some to blame the government shutdown for the unpredictable market behavior. The U.S. stock market took the largest Christmas Eve plunge in history Monday. On Wednesday, the market bounced back as the Dow rose as much as 562 points.
December is still on pace to post its worst performance since the 1930’s, however, according to CNN.
Though some have blamed the government shutdown for the recent market volatility, economists have pointed to a host of other economic reasons the market could be reacting to.
The Federal Reserve has raised interest rates four times in 2018, tamping down stock market gains throughout the year. Trump’s trade wars and tariffs may also be dragging down economic activity.
In Britain, the uncertain future of a Brexit deal may be unsettling to investors and companies waiting to see the eventual makeup of an economic relationship between Britain and the European Union.
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