We are now in 15 days of a partial government shutdown with no signs of any conclusion in sight. For those not directly impacted, it’s easy to just dismiss it as just government dysfunction where everyone involved is to blame, or perhaps take a side and support either Republicans or Democrats.
As with most things, if you look at things from an objective nonpartisan point of view- it’s pretty clear determining who are the main ones at fault and deserving blame.
In the world of investing/trading, one of the hardest lessons to learn is not to be biased in how the market will behave. The reason why so many people have problems knowing when to enter the market as well as exit is that they expect the market to follow their beliefs rather than understanding what the market is doing and following the market’s lead. If they decide the market is bullish, they will buy regardless of market behavior, and the same applies to if they think they should be bearish. This results in hurt feelings and deep account losses as the market will do what the MARKET WILLS, not what the trader/investor wants.
So to be good at investing/trading, you have to put bias aside and just go with the objective facts, and let the facts determine your conclusion. If you can do this you’ll also find it easy to apply it to all other areas of decision making in your life, which is really helpful in making the right choices.
So applying unbiased thinking to the current government shutdown-
We have 3 branches of government in the US:
1) Executive – President and his Cabinet
2) Legislative – House and Senate
3) Judicial – Supreme Court
To get a Bill passed- such as a Bill approving border wall funding, it needs to be written up and passed in both the House and Senate, and signed by the President.
President Trump, after making continual statements during his campaign that Mexico would be the one paying for the wall, now wants Americans to fund it instead, which is one of the reasons Democrats object to doing that.
The Senate needs 60 votes to approve a Bill and there weren’t enough votes to pass a Border Wall Funding Bill. Senate Leader Mitch McConnell introduced a continuing resolution to keep the government funded and that passed with over 90% of the Senate vote. At the time, Trump was okay with this. After the Senate passed that Bill, right wing media pundits went on Fox News and blasted the President for giving up on the wall and saying he was weak. As a result, when the Bill went to the House for approval, Speaker of the House Paul Ryan stated that the President was no longer willing to approve this Bill and therefore would not take a vote on it.
With the government funding deadline approaching, Trump now stated that he would not approve a government funding Bill unless it included $5+ Billion for a border wall.
This is where the system breaks and shows Trump is clearly the one to blame for the shutdown. The RIGHT procedure to get a Bill passed is to get it approved in the House and Senate by either the Presidents party majority votes or convincing enough non party members to join in. If you can’t get the numbers, then you campaign to get more members of your party elected to enable party majority voting to succeed.
What Trump is doing is bypassing normal government procedures and using a government shutdown as a hostage to force Democrats to comply with his demands. This action doesn’t make much sense because it makes the assumption that only Democrats will suffer during a government shutdown. In reality, Americans from BOTH parties suffer. The government employs Americans, not strictly Democrats or Republicans. Over 800,000 government workers from all states are either temporarily laid off (furloughed), or even worse, still required to work (because their job is considered “essential”) with no pay until the government is reopened, which includes Border Patrol agents.
One tangible result that will affect everyone is that the IRS is now only working with minimal staff and have stated that can’t process any refunds during this time. Another is a shortage of TSA employees at airports which increases travel security concerns.
Here’s a State by State map of how the shutdown affects the country:
As can clearly be seen – some of the most impacted areas are Republican majority States and both parties are suffering from the impact.
As Republicans, Democrats, and Independents are getting harmed, it makes absolutely no sense for the President to think he has the upper hand in threatening to continue to harm Americans if he doesn’t get his demands met.
Should the Democrats concede to his demands just to prevent further harm to those affected? The answer should be absolutely not, because it opens the door for future and continual misuse and abuse of this strong-arm extortion tactic.
For those cheering and supporting the President’s actions, would you feel the same way and support a Democratic President who bypassed normal legislation and made demands to pass his pet projects in the name of “national security” or “America’s well being”? Do we really want to start using extortion/hostage tactics as a new form of governing? This kind of behavior adds to and accelerates overall degradation of our government and should NOT be allowed to continue or succeed.
Here’s a question we all should be asking – during government shutdowns, why does the President, his Cabinet, House and Senate all continue to get paid as if it’s business as usual? I think we can all agree that if payments stopped for these folks just like they do for folks on the lower part of the totem pole, they would have a more pressing incentive to not have shutdowns or have them resolved much more quickly.
So how will this shutdown end with both Trump and the Dems at an impasse? Trump and the Republicans do not have any advantage here because the President has already taken full credit for the shutdown, which has been captured for posterity on video, even though he is trying to shift blame now.
The most directly impacted are those Federal workers who are not getting paid, and as their situations become more increasingly dire in ALL States, including Republicans ones, and the Dems offering legislation to open the government back up without including the Presidents demanded funding, pressure will increase on Republicans to end the shutdown. The elections of 2020 are on their minds and people in their State suffering financial hardship and facing homelessness and ruined credit ratings because of the failure of Trump and GOP to behave like rational adults will result in very ugly press coverage that will be used against them during election time.
Lastly, the wall itself has been estimated to cost as high as $70 Billion and doesn’t account for country access via tunnels, air travel, sea, or land via Canada. Trump is making a last stand over an empty campaign promise that wouldn’t do much of anything even it he got it other than to make a claim that he “got wall funding”, which is like you or I claiming to have home buying funding with just a few hundred dollars. Meanwhile those not getting paid or losing government services are paying the actual price.
Congress can pass a government funding Bill and override the President’s veto, if they have the will.