House sets vote on funding bill; agencies brace for shutdown

Maryland would be especially hard hit, experts say

September 29, 2013|By John Fritze, The Baltimore Sun

WASHINGTON — — Republicans in the House of Representatives passed a government funding bill early Sunday that would delay the nation's health care law for one year — inching federal agencies closer to a shutdown that analysts predict would damage Maryland's economy.

During a rare weekend session, GOP lawmakers advanced a series of bills to pay for government operations that would also put President Barack Obama's signature health care law on hold until 2015. The House was set to approve a separate bill to fund the military in the event of a shutdown.

The House legislation, coming days before Monday's deadline to fund the government or risk a shutdown, has no chance in the Democratic-controlled Senate, where leaders said they will not accept a funding bill that undercuts Obamacare.

The House vote was 231-192.

If lawmakers don't strike a deal, agencies will furlough workers and cut back on services Tuesday. The economic impact in Maryland will worsen with each passing day, experts said.

"The first day of a shutdown is a little like a snow day," said Stephen S. Fuller, director of the Center for Regional Analysis at George Mason University. "If it spans five or six days, then it begins to have more consequences."

Because of its proximity to Washington and its high concentration of federal workers, Maryland would be hit harder by a shutdown than many other states, economists say. Thousands of federal workers who live in the state would be sent home without pay, and contractors would be left holding unpaid invoices.

Officials estimate that the state would lose about $5 million in revenue and $15 million in economic activity for each day of a shutdown. The estimates are based on the tens of thousands of federal employees who would be furloughed.

"I'm most concerned about the economic impact," Gov. Martin O'Malley, a Democrat, said in an interview. "The biggest damage is what it does to our consumer and business confidence throughout the country, but that's especially true in the nation's capital."

A shutdown would also affect Marylanders who don't work for the government: Federal parks, including Fort McHenry and Antietam National Battlefield, would close. Passport applications would be shelved. School field trips to Washington would be canceled.

"A shutdown is not an idle exercise," said Sen. Barbara A. Mikulski, a Maryland Democrat and the chairwoman of the Senate Appropriations Committee. "It's not only turning out the lights at the Washington Monument."

While the state and national economy weathered the last federal government shutdowns in 1995 and 1996, analysts say the U.S. economic picture was rosier then, with an unemployment rate under 6 percent. Congress had also approved funding for several agencies before those shutdowns, blunting the impact.

The Obama administration began detailing Friday the actions it would take if funding lapsed, including furloughs of more than 13,000 employees who work for the Bethesda-based National Institutes of Health and another 18,000 at the Social Security Administration, which is headquartered in Woodlawn.

It's not clear how many of the furloughs would affect workers in Maryland.

The state's military installations would not be immune. Uniformed personnel and "mission essential" employees would continue to work at Fort Meade, but most garrison services would be closed, said spokesman Chad Jones. Nationwide, 400,000 civilian Defense Department workers would be furloughed.

Maryland and Virginia would be hurt more by a shutdown for the same reason they experienced less economic pain during the recession: their ties to the federal government. Fuller said that impact comes at a precarious time for the economy.

After outpacing the nation for years, the economy of Washington and its suburbs in Maryland and Virginia has slowed. The region lost more than 26,000 jobs from July to August — though most of that loss was not in Maryland.

Furloughs and contractor cuts would come on top of large budget cuts approved this spring that Fuller said are just now starting to have an economic impact. He expects most businesses in the region may be waiting to hire new employees until this latest round of budget battles shakes out.

Saturday's action on Capitol Hill pushed the government closer to a shutdown — but did not make that outcome inevitable. House Republicans did not rule out the possibility of a separate, short-term funding bill to move Monday's deadline back a few weeks.

Lawmakers approved such legislation during a similar showdown in 2011, hours before agencies were set to close.

Washington has lurched from one budget crisis to another for most of the past three years after Republicans captured control of the House in 2010. Many of those GOP lawmakers were elected on platforms of repealing the Affordable Care Act and cutting the size of the federal government.

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