White House National Economic Council Director Kevin Hassett issued a grave economic warning over the weekend, stating that a prolonged government shutdown could result in a “negative quarter” for the U.S. economy if it persists through the crucial Thanksgiving holiday period.
Speaking on “Face the Nation with Margaret Brennan,” Hassett detailed the increasing financial deadlines and legal pressures the ongoing closure is creating, emphasizing the disproportionate impact it could have on the economy during one of the most active consumer spending times of the year.
The Director highlighted a critical deadline for military personnel, confirming that military paychecks could stop on November 15th.
He explained that this impending halt stems from legal constraints under the anti-deficiency act, which prohibits government officials from spending money that Congress has not appropriated. This is considered the point of financial exhaustion for service members, whose pay is typically protected for a longer period during a lapse in funding.
Furthermore, Hassett addressed the legal tightrope the administration is walking to maintain essential services.
While benefits for the Supplemental Nutrition Assistance Program (SNAP) are currently being administered, he stressed that the effort is “really, really pushing the boundaries of the law.”
This attempt to distribute funds without official appropriation underscores the severity of the legal and budgetary challenges posed by the continuing shutdown, which are forcing officials to find increasingly tenuous workarounds to keep vital programs running.
Hassett underscored that the economic damage is rapidly escalating. He noted that the period around Thanksgiving and Black Friday is traditionally one of the “hottest times of the year for the economy.”
Should government functions, such as air travel regulation and security, be disrupted during this peak commerce and travel window, the slowdown would be significant enough to potentially push the fourth quarter into negative growth, creating major disruption for both the economy and the administration’s agenda.
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