Federal government shutdown: How it would impact Long Island

If Congress doesn't reach a deal by Wednesday to keep the U.S. government funded, Long Island could face impacts more severe than in previous shutdowns, including layoffs among its 31,000 resident federal workers.

No matter where the political blame lands in Washington, federal firings, furloughs and interruptions of critical services and operations over any extended period will hit individuals and families, and the economies of local communities, the hardest.

The second-highest concentration in New York State of civilian federal workers and their earnings is found in the Brookhaven and Upton areas of Suffolk County, where the Brookhaven National Laboratory (an arm of the U. S. Department of Energy) is located, according to research by Russell Weaver of the Cornell University School of Industrial and Labor Relations lab in Buffalo. 

Overall, nearly 185,000 New York-based workers are employed by the federal government — with about 31,000 of those workers living within Nassau or Suffolk counties.

On Saturday night, House Minority Leader Hakeem Jeffries (D-Brooklyn) and Senate Minority Leader Chuck Schumer (D-N.Y.) said President Donald Trump had agreed to a meeting with them in the Oval Office to discuss a bipartisan spending agreement. The White House did not immediately respond to a request for comment on their statement.

If a shutdown does occur, it would be the nation’s 15th since 1980, with the longest lasting 34 days between December 2018 and January 2019. Although that was the longest, it was only a partial shutdown, because some agencies had already received their full-year funding.

That is not the case this time. None of the 12 annual spending bills that fund the array of government agencies and programs has been passed by the Senate and House in agreed-upon versions. The partial 2018-19 shutdown is estimated to have caused at least $3 billion in permanent economic damage nationally, according to Bill Hoagland, senior vice president at the Washington-based Bipartisan Policy Center.

Yet, while the midnight Tuesday shutdown deadline edges closer, neither side in this showdown is blinking.

Trump did not offer much hint of resolution Friday morning, telling reporters at the White House: "These people are crazy, the Democrats. So if it has to shut down, it'll have to shut down. But they're the ones that are shutting it down."

Later, at the Capitol, Jeffries said Democrats "will sit down with anyone, and anytime, and at any place, to find a bipartisan path forward." But he added, “Republicans want to shut the government down. How is that not clear at this moment in time?" 

What's ahead if a shutdown occurs

• Not everything will suddenly stop. Vital programs like Medicare, Medicaid and food programs for low-income families will continue but could see distribution issues. Social Security checks will be sent out. And Department of Veterans Affairs services, including all health care operations, will continue.
• Aside from the threat of federal firings, millions of federal employees nationwide whose duties are deemed essential will continue to work, but without pay. Those include jobs tied to national security, law enforcement or other roles, such as air traffic controllers, U.S. Immigration and Customs Enforcement agents, or those tied to inpatient or emergency medical care.
• All active-duty service members and National Guard and reservists on federal active duty are required to work without pay, unless Congress acts on special legislation to pay them. 
• According to the Pentagon, there are more than 28,000 active-duty military troops stationed across New York State who could be impacted, along with other National Guard and reservists in the state expected to show up for work.
• Potentially hundreds of thousands of other federal workers could be prohibited from going to work, unpaid and not guaranteed they will be paid retroactively.
• There could be delays in processing business, home or farm loans, passports or other government benefits — and limited access to government buildings. Fewer environmental and food-safety inspections will occur. And visitor centers at federally funded national parks, museums or historic sites such as Sagamore Hill in Oyster Bay, though not necessarily the grounds, could be shuttered.
• Localities would be facing direct economic hits because of federal worker paycheck interruptions. 

How did things get this bad?

Republicans led by Senate Majority Leader John Thune (R-S.D.) and House Speaker Mike Johnson (R-La.) are insisting on mostly status-quo spending in a short-term bill that Congress needs to pass to keep most agencies funded and operating after midnight Tuesday — the official Oct. 1 start of the new fiscal year.

Such a "clean" bill — extending funding through Nov. 20 — would allow time for more robust, expansive negotiations on a funding bill for the remainder of the fiscal year, they say. Trump backs this approach.

But congressional Democrats, led by Schumer and Jeffries, see the must-pass funding deadline as ideal leverage to tack on items such as more than $1 trillion worth of health-policy provisions.

One aim is to reverse Medicaid cuts in Trump’s One Big Beautiful Bill Act, which Republicans passed in July. Another is preventing the scheduled January expiration of COVID-era enhancements of Affordable Care Act premium subsidies.

That expiration would cause big premium cost spikes for millions of Americans and thousands of Long Islanders, or outright losses of coverage, but key Republicans oppose extending the subsidies.

On Long Island, there are 117,200 Nassau County enrollees receiving such subsidies and 133,500 Suffolk County enrollees getting those, according to the state Health Department. The average premium cost increase per month for those Long Island credit-eligible recipients, if the tax credits disappeared, would be 32%.

Though Republicans control the majorities of both chambers, funding bills in the Senate need at least 60 votes to advance to a final vote, requiring at least seven Democrats to go along. As a result, a clean bill that Johnson was able to pass in the House this month was blocked without enough support to move forward.

White House threatens firings

The White House’s Office of Management and Budget has told agency heads in a memo that they should prepare to carry out federal worker firings if a shutdown happens.

Hovering over these negotiations is that many in the Democratic Party's base have for months complained that Schumer, in particular, did not more forcibly stand his ground in March in a previous stopgap funding battle for inclusion of Democratic policies.

But now, the White House threat of firings appears to validate Schumer's worries then that Trump would use a shutdown to reduce and reshape the workforce, while blaming Democrats.

Schumer has not folded this time, and not even all Republicans are on board with the White House's layoff threats.

"A shutdown should not be used as a means to mass fire federal employees," said Rep. Andrew Garbarino (R-Bayport), who, as chairman of the Homeland Security Committee, is a part of House GOP leadership.

Some Democrats, such as freshman Rep. Laura Gillen (D-Rockville Centre), called the threat of mass federal layoffs a "despicable" negotiating tactic when bipartisan negotiations are needed.

Rep. Tom Suozzi (D-Glen Cove), a main sponsor of a bipartisan bill to continue the expiring ACA, or Obamacare, subsidies for another year, said the Senate and House are all controlled by the GOP, "yet they refuse to even negotiate. Could it be that they actually want a shutdown ...?"

Suozzi also noted Trump has been waging a campaign to reduce the 2.4 million-member federal civilian workforce since January — but some workers such as at the Internal Revenue Service and others had to be hired back.

At the same time, some Republicans complain Democrats have now taken a hypocritical turn with Trump in the White House, changing their previous stances against using shutdowns as leverage to seek policy wins.

"Last Congress, when President Biden was in office, responsible House Republicans voted to fund the government despite our strong objections to his open-border policies," Rep. Nick LaLota (R-Amityville) said in an op-ed column this week. "We made it clear that shutting down government operations was not the way to fight those battles."

Newsday's Laura Figueroa contributed to this story.