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‘Near-term pain’ from shutdown: No paychecks on Friday

Thousands of furloughed government workers will not get their paychecks on Friday, a consequence of the partial government shutdown that has moved into its third week without signs of compromise. And if the standoff continues into February, millions who rely on food stamps or expect to receive tax refunds may also be affected. Washington Post reporter Damian Paletta joins Hari Sreenivasan from Washington, D.C.

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  • Hari Sreenivasan:

    Good evening and thanks for joining us. Day 16 of the partial government shutdown. Day two of negotiations between the administration and congressional staff, and the president says he doesn't expect much progress this weekend. On his way to meetings at Camp David this morning, President Trump told reporters he believes the 800,000 federal workers and contractors going without pay will be able to manage.

  • Donald Trump:

    I can relate, and I'm sure that the people that are on the receiving end will make adjustment. They always do.

  • Hari Sreenivasan:

    On his return this afternoon, the president again said he might declare a national emergency to get the wall built and said he has new instructions for his staff.

  • Donald Trump:

    I informed my folks to say that we'll build a steel barrier, steel.

  • Hari Sreenivasan:

    Joining us now from Washington, D.C., is Damian Paletta, White House economic policy reporter for The Washington Post. Damian, let's talk about this. As we head into week three, what are the kind of longer-term concerns about what's going to be funded and what's not?

  • Damian Paletta:

    This week will be a very important one, because Friday is the first paycheck that 800,000 American federal workers are going to miss. That's the first paycheck of their furloughed status that will not get paid. And so that's going to have an immediate impact on not just those 800,000 people, but also on their family members and of course the government contractors who also are not getting paid. So that's kind of the near-term pain we're expecting this week. And then as we slip into February, you know, some more monumental things happen, whereas food stamp money is expected to run out for 38 million Americans. And also the IRS and the Treasury Department right now are scrambling to figure out what they can do for those 40 million or so people who are planning to file their taxes in February and are expecting huge tax refunds. As it stands now, those will not be paid until this is sorted out. So there's a lot of things that are happening quickly and this is going to begin snowballing politically for the White House.

  • Hari Sreenivasan:

    So the U.S. Department of Agriculture is the one that administers the food stamps, right. I mean, we're talking about not people that are living for free on this, but these people, working people, that are getting benefits. What kind of impacts are they likely to see, and how do we prioritize who gets the limited funds?

  • Damian Paletta:

    So, yes, the Department of Agriculture runs this program. There's 38 million recipients, a lot of them are children. A lot of them are elderly people. This is what they rely on for their food, and there's never been a situation before where the money has been cut off. You know, it's always kind of re-appropriated by Congress in a bipartisan way, because this impacts people in every state. And so I think what they're wrestling with right now is whether they just have to give a haircut to everyone — you know, you only get 60 percent of the money you're supposed to get, because that's the reserves they have for one month, and after February, there would be no money. Or do they, you know, reapportion it so that just the elderly would get, you know, the money and everyone else would get cut off. They haven't sorted it out yet. But these are the things as this shutdown drags on, they're trying to resolve. They didn't anticipate it would go as long as it has.

  • Hari Sreenivasan:

    And when it comes to the IRS, most of the IRS is furloughed right now, and the people who file early are likely the people who are going to get refunds, right?

  • Damian Paletta:

    Absolutely. If you were getting a check — if you owe money, you kind of wait to the last minute in April. But if you're getting a refund, you file early, and the earliest you could file last year was January 29. Last February of 2018, $140 billion in tax refund — that's billion with a B — was paid out in the month of February. As of the IRS's plan last year during a shutdown, they would not pay any tax refunds while Congress has not funded their agency. And so we're in a situation now where they have to decide do we not put that money out back to the taxpayers — $140 billion — or do we reverse ourselves and possibly you know legally dicey decision and pay that money out even though we have a skeleton staff that maybe is unable to kind of check, you know, the dots … dot the i's and cross the t's. So that all those things are happening at a frenetic pace right now, because like I said, they did not expect it to get to this point.

  • Hari Sreenivasan:

    Yeah, we should remind viewers that those $140 billion in taxes or all of that money that goes through food stamps that has a ripple effect on the grocery stores that don't get the money. Or most people don't just put it all in their savings account, they turn around and spend it for the needs that they have. You know, you and your colleagues have also been writing about the Park Service. What's happening there?

  • Damian Paletta:

    Yeah, it's really interesting. So during shutdowns, even though national parks is kind of a small part of the federal budget, they become the public face of the shutdown because so many Americans go visit national parks — you know, Statue of Liberty, et cetera. And so right now, what we've seen is the first major reversal by the White House during the shutdown. They have reversed themselves and are planning to reopen parts of the parks that had been closed and add staffing, because it was giving unsustainable the amount of trash that was piling up, you know, the bathrooms that were getting very unsanitary and so they're going to try to add staff back using the fees they collect from people that are entering these parks. Now it was deemed, you know, just a week ago that they cannot legally do that, because you're not allowed to use the entrance fees to pay the staff and things like that, that has to be appropriated by Congress. But they've decided that they need to do that. They have to do that. And so we're expecting the political fight over that as well, but that's what I'm trying to say, these are the sorts of flash decisions they're trying to make to minimize the impact of the shutdown. But a lot of these things are unprecedented, never been tested, and you know it's unclear how it will work.

  • Hari Sreenivasan:

    Right. Washington Post's Damian Paletta joining us from Washington tonight. Thanks so much.

  • Damian Paletta:

    My pleasure, thank you.

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