by Kyle S. Plotkin
Investment Advisor Representative
[email protected]
This week marked the end of the longest government shutdown in U.S. history, with the president signing a budget bill into law on Wednesday night. After weeks of stalemate, the final deal did little to move the needle—Democrats failed in their bid to include funding for Affordable Care Act (“Obamacare”) subsidies, and a separate vote on those subsidies is expected next week. Few expect it to pass either chamber of Congress.
While the government is finally open again, the full scope of the damage will take time to emerge. In the short term, travel disruptions and canceled flights are slowly easing as federal aviation employees return to work. Most federal workers will receive back pay, but the financial strain of missed paychecks has already left a mark on millions of households. SNAP benefits are resuming, though low-income families have already felt the sting of delayed assistance.
The broader economic effects may linger well beyond the shutdown. The Congressional Budget Office previously estimated that a six-week shutdown could shave as much as 1.5% off fourth-quarter GDP growth. That lost output, along with reduced consumer spending due to missed paychecks could show up in upcoming economic data.
Speaking of data, the shutdown has thrown a wrench into the normal release of key government statistics. The White House announced that the Bureau of Labor Statistics will need extra time to catch up on missed inflation and unemployment reports, and the full October numbers may never be released. That could spell problems for economists, analysts, and investors who rely on consistent data to gauge the economy’s health.
An article published in the Wall Street Journal this week also outlined uncertainty surrounding the Federal Reserve and their upcoming decisions at their December meeting. Any missing inflation and jobs data could cause a gap in their analysis and further push disagreement amongst board members on whether to drop rates again before the end of the year.
Meanwhile, Americans purchasing health insurance plans through the ACA Marketplace will face sharp premium hikes in 2026. Without renewed subsidies, many enrollees are seeing costs double or even triple compared to last year.
And if you didn’t think this shutdown was disruptive enough, the budget that passed only extends through the end of January, setting up another potential battle in just a few short months. Will we be looking at another shutdown? Who knows?
On a lighter note, I can’t believe we’re only two weeks out from Thanksgiving. I know time seems to move faster as we age, but this year truly went by in a flash. In any case, I hope you all have a great weekend and the Birds can pull out another W on Sunday night.