Disrupting everything from Alaskan crab fishing to shipping U.S. beer abroad, the shutdown cost taxpayers at least $2 billion in back pay for furloughed workers, according to a new report released by the White House.
Calling the 16-day shutdown “the most significant on record,” the White House said that work not performed by furloughed employees represented the biggest cost of the shutdown. A total of 6.6 million work days were lost in total during the shutdown, which furloughed about 850,000 federal workers every day.
Since Congress voted to give furloughed employees back pay, the total compensation cost for work not performed was $2 billion in pay. With total compensation costs added in, that figure is about $2.5 billion. By comparison, the 1995-96 shutdown cost about $1.65 billion in payroll costs, in today’s dollars.
The administration’s $2 billion price tag doesn’t include the ripple effect of the shutdown on the broader economy. The White House, for example, noted that the start of the Alaskan crab-fishing season was delayed because furloughed officials were unable to set harvest levels, costing fisherman “thousands of dollars of lost revenue.” Outside experts estimate that the fiasco cost the entire economy between $20 billion and $24 billion, lowering economic growth this quarter from 2.5 to 2.0 percent, according to Moody’s.
The shutdown also delayed nearly $4 billion in tax refunds; 355 food safety inspections; and 200 applications for drilling on federal land, among scores of other effects. It even kept U.S. businesses from shipping more than 2 million liters of beer, wine, and liquor, which were stuck at ports as federal officials were unable to issue export certificates.
“One thing that did come out of the shutdown is a greater appreciation for a number of things that the government did,” Sylvia Burwell, director of the Office of Management and Budget, said on a press call.
There were other costs to taxpayers as well. The National Park Service lost about $7 million in revenue because of the shutdown. The government also racked up interest on late payments to contractors and others owed money during the shutdown.
Democratic Sen. Barbara Mikulski, head of the Senate Appropriations Committee, had requested the study, which comes as legislators are trying to hash out a longer-term budget and avoid another shutdown.
“The government shutdown was a shameful and damaging episode that we can’t afford to repeat,” Rep. Nita Lowey, a member of the budget conference committee, said in a statement. “Our economy and American taxpayers simply cannot afford another manufactured crisis when the Continuing Resolution expires on January 15th.”
Suzy Khimm