Friday, April 8, 2011

The price of a government shutdown

So if the federal government shuts down, taxpayers would save a lot of money, right?

Not quite.

It would actually cost taxpayers money. And for every day the shutdown continues, the bill would go up.

"There is absolutely no way this saves money. Zip," said Bo Cutter, former director of the National Economic Council and a senior fellow at the Roosevelt Institute.

It's pretty hard to put an accurate price tag on a shutdown. Official estimates of the costs incurred during last major shutdowns in 1995 and 1996 vary widely.

And the White House hasn't produced an estimate of how much a shutdown might cost, but it does say it will cost something.

First, the government actually has to spend money in order to complete an orderly shutdown.

"When you have to shut something down, that costs money, and ramping something back up costs money," Jeffrey Zients, deputy director of the Office of Management and Budget said Thursday.

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