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What if the US Government Shuts Down & Nobody Notices?

I'm really trying to muster up some excitement over the potential shutdown of the US government, but I can't. It may seem obvious, but the closure of the US government will have no effect whatsoever on the electronics supply chain.

I'm not sure if this is a good thing or a bad thing.

Here's what I gather from reading about the potential shutdown: All the bad stuff, like income tax deadlines, will stay the same. The IRS does not take a holiday. A lot of government employees will be out of work, and, potentially, they won't be reimbursed for the time they are furloughed.

All the good stuff, like national parks, will be shut down. There won't be anyone around to tell you what you are looking at.

Air Traffic Control, the US Post Office, and the Federal Reserve will all continue with business as usual. No supply chain disruptions here.

One of the reasons why most things will continue to operate as usual is technology. The Social Security system, for example, automatically cuts and sends out checks. As imperfect as it is, Air Traffic Control has a lot of technology backing it up. And you can file your personal income tax forms electronically, and the system will either send you money or take your money away.

I'm not sure what happens to any purchase orders the government has for technology upgrades and equipment. This is one potential downside for the supply chain. But for the most part, a government with a budget that exceeds the GDP of most nations on earth shuts down, and nobody notices.

I guess that qualifies as a bad thing.

10 comments on “What if the US Government Shuts Down & Nobody Notices?

  1. Parser
    April 8, 2011

    The trick for government is that they can borrow to pay from a bottomless well. The borrowing goes to future generations or to inflation. Saying this I have to also point out that there are many governments programs which are not visible like federal subsides for electric vehicles, jet engines, science and development and all that is most likely to shutdown leaving electronic equipment and components purchases out of market. How about NASA? Even 800k workers who are on government payroll they will not buy any electronic products fearing furloughs. These people will lower their spending in restaurants therefore waiters may postpone purchasing mp3 players also. Having income or seeing paycheck cuts trickles down in economy. Maybe all that is not going to make a true dent in a short term for a week or a month in electronics industry but any longer than that will and not only in electronics. 

  2. Ashu001
    April 8, 2011

    Barbara,

    The very fact that the US Govt is able to shut down and no one notices (or cares);shows what a massive waste of resources the US Govt. is and how little work (of value) is done by most Govt. Employees.

    http://globaleconomicanalysis.blogspot.com/2011/04/too-many-bureaucrats-and-they-are-paid.html

    I really liked the above post which explains clearly that there are today more Govt. Employees than ones employed in Construction and Manufacturing combined.

    Amazing stats.

    regards

    Ashish.

  3. Parser
    April 8, 2011

    I am wondering who is not going to notice missing IRS refunds. Wives and husbands of military soldiers on duty will have hard time paying their rents or mortgages. No more passports issued so reps of companies doing business in China will not be able to travel. US Government shut down will be noticed. While these are non-essential workers they would interrupt the chain, just like checks and balances as defined in funding fathers of our constitution. Let us think how much savings we could have without IRS, military and borders it is mind bugling. But maybe this is only utopia. 

  4. mario8a
    April 8, 2011

    Hi

    I lived in US for a long time, I noticed how the people is very used to have the  system manage their lives, and most of the times the education will force you to get into the gov. system like or not.

    I'm sure many people will noticed, however I've seen many people to get away and not depending on the gov. system, this US ciitizen make it happen only out of the US.

    food for though.

     

  5. Ashu001
    April 9, 2011

    Parser,

    If you have studied History before-This is'nt Utopia.

    Empires have collapsed before America's and will collapse in the future as well.

    They collapse when the become bloated(thats what America today is).

    Unless we see a massive trimming down of the fat(Layers and Layers of Govt. bueracracy which contribute nothing to Economic Growth);The American EMpire currently surviving on Debt and more Debt will collapse and collapse in a hurry pretty soon.

    When that Happens,its going to be the end of this massive Militiary machine as well as this culture of Entitlements that are in place in every sector of the US Economy.

    Regards

    Ashish.

     

  6. Anand
    April 9, 2011

    Barbara,

    Good news is “deal to Cut $38 Billion Averts Shutdown”. But good to see that Shutdown doesn't has any effect whatsoever on the electronics supply chain.

  7. itguyphil
    April 9, 2011

    We won't know that for sure since it was avoided but there's always some reverberations in any sector when it comes to the government.

  8. elctrnx_lyf
    April 10, 2011

    That is really an interesting piece of article. Obviously the governemt will not shut down, but even if it happens many things go as same asusual. Technology has created the environment where lot of things happen automatic. But anyway we need some one to administer, maintain these technologies even for the government otherwise it is all gonna be big turmoil.

  9. Kunmi
    April 11, 2011

    If the government had short down, everyone would have known. It will be like the game of shorting the door against the smoke, it will surely rise to the air. Families would have been affected, institutions would have been impacted, Wall street would have recognized it too. The fact that it was not in short down does not avert the upcoming budget challenges. What do we expect?

  10. Anna Young
    April 12, 2011

    You're right Pocharle we wont know for sure as it was averted. That was a relief though.

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