Shutdown Costs and Benefits: Finger-Pointing Festival

Photograph by Melina Mara/The Washington Post via Getty Images

On the 16th day of a government shutdown, Senator Ted Cruz (R-TX) speaks to reporters while Senate Republicans work toward a solution to the federal government shutdown and a temporary raise to the debt ceiling, on Capitol Hill on Oct. 16, 2013.

To hear Sen. Ted Cruz’s story, the 16-day partial shutdown of the U.S. government produced some real “tangible results.”

To hear the White House’s Jason Furman tell it, the shutdown cost 120,000 jobs and a quarter-percent of GDP growth.

To hear both sides explain it, the other is responsible for the shutdown.

The way the public sees it, polling shows the Republicans are responsible.

Cruz’s office produced a memo about the Texas Republican’s failed bid to defund the president’s health-care program, The Daily Caller reports: “The defund plan produced tangible results that create both immediate and long-term benefits for the country and the conservative cause… ”

“First, it intensified the nation’s focus on Obamacare. Second, it energized Americans by showing there are people in Washington willing to take real action to stop Obamacare. Third, it exposed, for all to see, the Democrats’ refusal to compromise out of blind devotion to their extreme liberal agenda. Lastly, it proved the need for Republicans to unite and stand firm together in their resolve to defeat Obamacare.”

The White House’s Council of Economic Advisers has produced its own memo.

On the day that the Labor Department finally released a delayed count of September’s employment, and the jobless rate of 7.2 percent down a notch, to its lowest since November 2008, CEA Chairman Furman notes that the October report will include a damage report:

“Weekly employment indicators not in today’s report suggest that the labor market situation deteriorated in early October, coinciding with the shutdown and the threat of a possible default. Today’s employment report provides a snapshot of the economy in September, prior to the shutdown and debt limit brinksmanship.”

“To understand more recent labor market developments we need to rely on other data that gives an initial indication of economic developments in October, including initial unemployment insurance claims and the Gallup Job Creation Index. Prior to the shutdown the four-week moving average of claims fell to 305,000, the lowest level since May 2007. But initial claims spiked in the first two weeks of October and reached their highest level since March (note the claims data do not include Federal employees). ”

“Although the precise cause of changes in the number of initial claims can be difficult to discern, the uptick in claims was corroborated by a similar movement in Gallup’s Job Creation Index, which is based on a weekly survey of approximately 4,000 workers. The Gallup index represents the net percentage of respondents who say their employers are adding workers, and has tracked unemployment insurance claims in the past. Both indicators suggest that the shutdown and debt ceiling brinkmanship in the first half of October had a disruptive effect on the labor market. ”

“During the shutdown, hundreds of thousands of Federal workers went unpaid, families were unable to travel to national parks, oil and gas drilling permits were delayed, Small Business Administration loans were put on hold, licenses to export high-tech products could not be granted, and documentation required to get a mortgage could not be accessed, to name just a few effects. ”

Cruz also places the blame for the shutdown on the president, who refused to negotiate any changes to the Affordable Care Act as part of the continuing budget resolution fight that forced the shutdown or the debt-limit extension that reopened the government 16 days later.

“President Obama is responsible for shutting down the government because he refused to negotiate with the House of Representatives to keep the government open,” the senator’s memo states. “President Obama issued 15 veto threats to bills the House of Representatives passed, with significant bipartisan support, to re-open the government and fund vital government services, such as the Department of Veterans Affairs and the national parks.”

The Democratic National Committee has placed the blame on Cruz and company, who, despite the warnings of senior Republicans that Obama had no incentive to and never would bargain away any part of his signature health-care program, insisted on a no-win strategy that forced the shutdown on Oct. 1, the first in 17 years. Only on the eve of the expiration of U.S. borrowing authority did the House relent and allow a vote on a clean budget resolution and debt-extenstion, with more than a third of Republicans joining in.

In the aftermath, the DNC has been targeting Republicans around the country. It’s not only the Cruz Shutdown, the party contends. It’s also the Rubio shutdown, as the DNC runs “robo-calls” against the junior senator from Florida, Republican Marco Rubio.

ABC News and the Washington Post have found in polling through the confrontation that public blame shifted toward the Republicans the longer the standoff went:

“Asked who they consider responsible for the impasse, 53 percent of poll respondents cite Republicans, 29 percent blame Obama and 15 percent fault both sides equally. Republicans who support the Tea Party movement overwhelmingly blame Obama for what happened, but among Republicans who do not back the Tea Party, almost as many cite congressional Republicans as name Obama or both.”

“Perceptions of the way Republicans handled the budget negotiations grew steadily worse through the weeks of confrontation, rising from 63 percent disapproval on the eve of the 16-day shutdown, which began Oct. 1, to 77 percent disapproval by the time it ended. Nearly three in five Republicans disapprove of their party’s handling of the negotiations.”

In other words, Cruz is playing to a receptive audience.

So is the White House — a much bigger audience, too.

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