Lessons Learned (Maybe) From the Shutdown

Jan 23, 2018 - 4:15pm

Senior Vice President, Economic Policy Division, and Chief Economist

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A sign indicating that the National Archives Building in Washington, D.C., is closed due to the federal government shutdown.
A sign indicating that the National Archives Building in Washington, D.C., is closed due to the federal government shutdown.

With the government shutdown now shut down, it’s worthwhile considering what just happened.  The lessons aren’t particularly complicated, but that doesn’t mean certain politicians will learn them.

To recap: The law allowing normal government spending expired at midnight on Friday, January 19.  The day before, the House Republicans passed a clean bill, meaning no extraneous items attached, to keep the government open.  House Republicans could have played games, attaching some nasty little items to really cause Senate Democrats heart burn, but they didn’t. The House passed a clean bill. Six House Democrats voted for the spending bill. The President indicated he’d sign the bill.

With its notoriously frustrating rules Senate passage required significant numbers of Democrats and Republicans. Behind Republican Leader Mitch McConnell’s (KY) leadership, almost all Senate Republicans voted for the bill, those few opposing apparently not having gotten the memo (again). The Democrats collectively opposed and the bill failed.

So, who really caused the shutdown? It’s pretty obvious the Democrats caused the shutdown, the only possible argument to the contrary being that the Republicans hadn’t caved in to Democratic demands on other items, most especially the DACA issue. Arguing that Republicans caused the shutdown because they didn’t cave to the Democrats simply doesn’t pass the laugh test.

Three days later, voila, a spending bill.  What happened in the interim?  The Senate Democratic Leader, New York’s Chuck Schumer, came face-to-face with a painful reality – Democrats had the power to create a mini-crisis, but lacked the power to win it. This is a lesson Republicans over the years have had to learn time and again, most recently with last year’s attempts to repeal Obamacare. It doesn’t matter how strongly one side or the other feels about an issue. Either you have the votes, or you don’t. Anger and vitriol rarely shift votes favorably. 

Whether Senator Schumer knew or suspected all along the Democrats would lose this fight we will never know, but at least he realized the truth in the old country song about knowing when to hold’em and knowing when to fold’em.

That apparently is more than can be said for many of his Democratic colleagues, who appear sincerely furious Schumer concluded that for the sake of the party, not to mention the country, someone had to be the grownup in the room. “I trust that because the leadership did it this way, they know something I don’t,” observed Senator Feinstein (D-CA). Apparently so.

Democrats want a sensible, humane, resolution to the DACA issue now. We get it. So, by the way, does the U.S. Chamber, along with numerous other immigration reforms. Apparently, so do a large number of House and Senate Republicans. Somehow, they’ll eventually find an answer. But in the meantime the essential reality remains the Democrats have the power to cause a budget crisis but not to win one.  

The current spending bill lasts through February 8. Though recent history provides little comfort, one hopes Congress will make substantial progress on DACA and other non-budget issues in the interim. If not, then Senator Schumer will again be faced with the painful reality of a budget fight he can’t win. Will his members figure this out in time or will they, like Republicans so often in the past, insist on running full tilt into a wall and toward defeat?  

About the Author

About the Author

Senior Vice President, Economic Policy Division, and Chief Economist

Dr. J.D. Foster is senior vice president, Economic Policy Division, and chief economist at the U.S. Chamber of Commerce. He explores and explains developments in the U.S. and global economies.