U.S. government shutdown hit economy, wasted money -White House

Reuters

By Mark Felsenthal

WASHINGTON, Nov 7 (Reuters) - The White House budget officeon Thursday catalogued the economic damage from the 16-daygovernment shutdown, saying the closure wasted billions ofgovernment dollars and hurt individuals and businesses thatdepend on government functions.

Broadly speaking, the shutdown shaved an estimated 0.2 to0.6 of a percentage point off U.S. gross domestic product in thelast three months of the year, the budget office said, citingprivate-sector analysts.

It is also calculated to have dampened job creation by120,000 jobs, the budget office said, pointing to an analysis bythe White House Council of Economic Advisers.

The closure, which prevented some government employees fromgoing to work, also cost the government $2 billion "for servicesthat could not be performed," the budget office said.

Budget Director Sylvia Matthews Burwell said the report wasprepared at the request of Democratic Senator Barbara Mikulskiand because the White House wanted to document the impact of theshutdown.

"One thing that did come out of the shutdown is a greaterappreciation for a number of the things that government did,"she told reporters on a conference call.

Lawmakers have begun meetings to hash out differences overthe budget between the Republican-controlled House ofRepresentatives and the Democratic-led Senate. Lawmakers of bothparties have said they want to avoid another shutdown, but theparties are deeply divided over spending and taxes, and theymust agree on a spending bill in order to avoid another shutdownon Jan. 15.

The closure, which took place in a budget standoff ascongressional Republicans sought to block or delay thepresident's signature healthcare law, affected individual andbusinesses on a range of levels, from people who seek loans orpermits from the government, to those expecting tax refunds orto be enrolled in clinical trials, the White House said.

Among specific setbacks caused by the shutdown, the Bureauof Land Management was unable to process about 200 applicationsto drill, delaying energy development on federal lands, thebudget office said in its report.

The closure also held back international trade as import andexport license permit applications and export promotionactivities languished, officials said. They noted that theExport-Import Bank, which provides financial support for U.S.firms to trade abroad when private-sector financing is hard tocome by, and which typically backs exports valued at $4.2billion in a month, had to suspend approvals of newapplications.

The report detailed some of the smaller effects of theshutdown, noting, for example, that the Alaskan crab fishingseason was delayed by three to four days, costing fishermenthousands of dollars.

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