The United States Congress passed a new measure to prevent default and open US government services. The decision was made to extend the country’s debt ceiling and restore vital government services, preventing an extended shutdown.
Government services in the United States have been non-operational for the past week, with protests between Democratic and Republican leaders bringing the US government to a standstill. A ‘temporary fix’ measure has been approved by both the House of Representatives and Senate, reopening the government.
The deal, which guarantees government funding until January 15 and increases the country’s debt ceiling until early February, is not a long-term measure. Economists have voiced concerns that the government could shut down again as the debt limit looms and scuffles again begin between Republican and Democratic leaders.
While political pundits have pointed to government officials and politicians as the biggest losers of the shutdown, the business community has been hit the hardest of all. The two-week shutdown is believed to have cost tourism businesses hundreds of millions of dollars in lost revenue across the United States.
Tourism companies were dealt the biggest blows, having to deal with a large decline in demand as thousands of people cancelled their holiday trips. Photographers were also hit hard by the shutdown as national parks and monuments – popular wedding venues – closed, causing many of their customers to cancel bookings.
Government contractors were also very hurt by the shutdown, with cash flow for a wide variety of private companies slowing to a crawl. The total cost of the shutdown is estimated at $24 billion – a significant hit to both small businesses and the major contracting firms that largely depend on business from the US government.
