Shutdown cost pegged at $3B as U.S. government reopens

The U.S. economy is expected to lose $3 billion from the partial federal government shutdown over President Donald Trump's demand for border wall funding, congressional researchers say, as 800,000 federal employees return to work after a 35-day unpaid furlough.

Some lawmakers pushing legislation to pay contractors for lost wages

A Smithsonian National Zoo employee removes a sign telling visitors the Washington zoo is closed due to a partial government shutdown. It is scheduled to to reopen to the public on Tuesday. (Chip Somodevilla/Getty Images)

The U.S. economy was expected to lose $3 billion US from the partial federal government shutdown over President Donald Trump's demand for border wall funding, congressional researchers said on Monday, as 800,000 federal employees returned to work after a 35-day unpaid furlough.

The nonpartisan Congressional Budget Office (CBO) said the cost of the shutdown will make the U.S. economy 0.02 per cent smaller than expected in 2019. More significant effects will be felt by individual businesses and workers, particularly those who went without pay.

Overall, the U.S. economy lost about $11 billion during the five-week period, CBO said. However, the agency expects $8 billion to be recovered, as the government reopens and employees receive back pay.

The longest government shutdown ended Friday when Trump and Congress agreed to temporary government funding — without money for his wall — as the effects of the shutdown intensified across the country.

Trump had demanded that legislation to fund the government contain $5.7 billion for his long-promised wall along the U.S.-Mexico border. Democrats call it costly, inefficient and immoral.

Feb. 15 deadline

A committee of Republican and Democratic lawmakers have scheduled an initial meeting on Wednesday, which will be open to the public, as they try to negotiate a compromise on border security before Feb. 15, when funding once again runs out.

That session is likely to see little more than opening statements by lawmakers. Subsequent meetings could be conducted in private, where the hard bargaining would take place, several congressional aides said.

Owing to rules governing legislation in the House of Representatives requiring a 72-hour period for lawmakers to review legislation before having to vote on it, the committee might have to wrap up its work by around Feb. 10 in order to meet the Feb. 15 deadline.

The CBO estimated the shutdown reduced gross domestic product in the last quarter of 2018 by $3 billion.

It said that in the first quarter of 2019, the level of real GDP is estimated to be $8 billion lower than it would have been, citing "an effect reflecting both the five-week partial shutdown and the resumption in economic activity once funding resumed."

Trump said he would be willing to shut down the government again if lawmakers do not reach a deal he finds acceptable on border security. On Sunday, he expressed skepticism that such a deal could be made, putting the odds at 50-50.

U.S. federal government worker Yvette Hicks, whose status as a contractor means she will receive no back pay from the 35-day shutdown, cries in frustration as she talks about her situation at her home in Washington on Friday. (Michael A. McCoy/Reuters)

Trump has also said he might declare a national emergency to get money for the wall, an extraordinary move that Democrats and some Republicans have vowed to fight and that would likely face a court challenge.

The CBO report serves as a stark warning to Trump against another shutdown, Democratic lawmakers said.

"Families across the nation are still trying to recover from a month of missing paycheques and overdue bills, but the president is already threatening a second shutdown if he doesn't get his way," House Speaker Nancy Pelosi said.

Democrats say they back additional funding for border security measures such as increased technology and border patrol agents, but not for a wall.

Republicans, who controlled both the Senate and the House when the shutdown began Dec. 22, are wary of a repeat closure. Polls show the public mostly blamed Trump and his party for the shutdown.

Federal workers are expected to get paid this week for the five weeks of missed paycheques. Federal contractors and businesses that relied on federal workers' business, however, face huge losses, although some lawmakers are pushing legislation to pay contractors back as well.

The National Transportation Safety Board said on Monday it had been unable to send investigators to 22 accidents during the shutdown, including 15 aviation accidents that resulted in 21 deaths. "These 22 accidents now require investigative action," the safety agency said, but added that evidence "may have been lost." 

The National Highway Traffic Safety Administration was reviewing five weeks of auto safety recalls that had been submitted by automakers, but has not yet begun posting them publicly.