GOP divided about likelihood of another federal shutdown

Cruz

ASSOCIATED PRESS

Treasury Secretary Jacob Lew said on NBC's ‘Meet the Press’ that the fight over government spending pushed the country near the brink of default and the lesson has to be that it can't happen again.

WASHINGTON — After a spending deal last week reopened the federal government through early 2014, officials from both political parties tried to ease concerns on Sunday about the possibility of another shutdown in just a few months.

“This can never happen again,” Treasury Secretary Jacob Lew said on NBC’s Meet the Press.

Sen. Mitch McConnell (R., Ky.), the chamber’s top Republican who helped broker the agreement, said that although he disliked the new health-care law — the sticking point in the latest impasse — there was no use in Republicans’ trying to roll it back while Democrats control the Senate and the presidency.

“There will not be another government shutdown,” he said on the CBS program Face the Nation. “You can count on that.”

But Sen. Ted Cruz (R., Texas), who was criticized by many in his own party for prolonging the gridlock, called last week’s budget agreement “terrible” and did not rule out another shutdown.

“I would do anything, and I will continue to do anything I can to stop the train wreck that is Obamacare,” he said on ABC’s This Week.

Republicans backed away from their push to defund President Obama’s health-care law on Wednesday, agreeing to a deal to reopen and finance the government through Jan. 15 and allow the government to continue borrowing money through Feb. 7.

Illuminating the divisions within the Republican Party, Mr. Cruz blamed his fellow Senate Republicans for the defeat.

On the CNN program State of the Union, Mr. Cruz said they could have succeeded if they had united behind their counterparts in the House and called out the Democrats for their unwillingness to compromise.

“What we did have is we had half the Republican conference on TV, not making that point, but instead making President Obama and the Democrats’ point, attacking the House Republicans, attacking those of us trying to stop Obamacare,” Mr. Cruz said.

Sen. John McCain (R., Ariz.) called for civility within his party and apologized for calling Mr. Cruz and other Tea Party conservatives “wacko birds.”

But Mr. McCain rejected the notion that Mr. Cruz could cause a second shutdown in January.

“I think that he can exercise his rights as a senator, but it will not happen,” he said. “The American people will not stand for another one of these things.”

Mr. Lew emphasized the risk of gridlock, saying on NBC’s Meet the Press that economic growth took a hit during the 16-day shutdown as the nation approached its borrowing limit.

“We need to make sure that government does not go through another round of brinkmanship,” he said.

That’s not to say there is a solution at hand.

No one is rushing forward with alternatives to a potential repeat of the gridlock.

The political price has been high ahead of 2014’s midterm elections, especially for Republicans.

“I think there was some ground lost from the political point of view,” said former Florida Gov. Jeb Bush, a potential 2016 presidential contender for the GOP.

“There were really no winners,” said Sen. Mark Warner (D., Va.) on CBS’ Face the Nation. “I mean, our country took an economic hit.”

Nobody is certain how much the shutdown cost the U.S. economy in dollars and cents yet, but economic research firms estimate the damage will be several billion dollars.

Affiliated damage — such as the undermining of consumer and business confidence — will be far greater, economists said, especially combined with the financial effects of the near-breach of the country’s statutory debt ceiling.

It might take months for the Obama Administration to come up with a thorough accounting of the direct cost to taxpayers of putting much of the government out of business and then reopening it.

Several offices said they were in the process of gauging the disruptions.

“The three weeks of government shutdown will cost the economy $3.1 billion in gross domestic product from lost government services,” estimated Paul Edelstein and Doug Handler of IHS Global Insight, an economic research firm.

“There will also be some impact from lost private-sector jobs tied to the shutdown, as well as a loss of consumer and business confidence resulting from the debt-ceiling showdown.”

Ratings agencies including Standard & Poor’s and Moody’s Analytics have estimated that the shutdown cost the economy at least $23 billion in projected growth.

Putting huge parts of the federal government offline will produce some savings for the taxpayer through reduced hours for certain contract employees and from lower operational costs, for instance.

But those savings likely would be overwhelmed by losses, user and permit fees.

The government has lost out on millions of dollars that would have been spent at shuttered parks, caves, monuments, and museums, for instance, with the National Park Service putting its toll at $450,000 a day.

Another major cost is related to payments to contractors and other service providers that the government missed. Some businesses might be due interest because of the late checks, or might request more compensation because of the disruption.

But the heftiest cost will be paying federal workers for time they spent idle — about 800,000 workers were barred from working.

Some offices might have to increase overtime to rush work that did not get done.