Treasury Secretary Scott Bessent cautioned on Sunday that the ongoing federal government shutdown is increasingly damaging the U.S. economy, warning that economic growth for the current quarter could decline by up to 50% if the stalemate persists.
“We’ve seen an impact on the economy from day one, but it’s getting worse and worse,” Bessent stated in an interview on ABC’s “This Week.”
He noted that despite strong economic performance in the previous two quarters under President Trump, projections now suggest that growth in the current quarter could be reduced by half if the shutdown continues.
The closure, which began on October 1, has left hundreds of thousands of federal workers without pay and disrupted the release of vital economic indicators, complicating decision-making for both policymakers and businesses assessing economic conditions.
Since 1976, the United States has experienced 20 government shutdowns. The most recent prior shutdown lasted 34 days, from December 2018 to January 2019, triggered by a dispute over funding for President Donald Trump’s border wall. The current impasse has now surpassed that duration, with growing consequences across the country.
Delays in Supplemental Nutrition Assistance Program (SNAP) funding and mounting strain on the national air travel system ahead of the Thanksgiving holiday illustrate the widening impact. Bessent emphasized that the human toll is significant, noting that the busiest travel period of the year is approaching and urging five Democratic senators to help break the deadlock.
He also warned that consumers may face shortages of goods as cargo inspections and customs processing slow due to reduced staffing. The disruption not only affects daily operations but also undermines confidence in economic stability.
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Treasury Secretary Bessent warns shutdown could slash quarterly economic growth by half
Treasury Secretary Scott Bessent warned Sunday that the ongoing government shutdown is taking an escalating toll on the U.S. economy, saying growth could be cut “by as much as half” this quarter if the impasse drags on. n n”We ‘ve seen an impact on the economy from day one, but it ‘s getting worse and worse,” Bessent said during an interview on ABC ‘s “This Week” program. n nGOVERNMENT SHUTDOWN THREATENS CRUCIAL ECONOMIC DATA, LEAVING FED — AND FAMILIES — IN THE DARK n n”We had a fantastic economy under President Trump the past two quarters and now there are estimates that the economy and economic growth for this quarter could be cut by as much as half if the shutdown continues,” Bessent added. n nThe shutdown, which began on Oct. 1, has forced hundreds of thousands of federal employees to go without pay and delayed key economic data releases, making it harder for policymakers and businesses to gauge the health of the economy. n nPOWELL WARNS SHUTDOWN IS CLOUDING FED’S VIEW OF THE ECONOMY: ‘DRIVING IN THE FOG ‘ n nOnce rare, government shutdowns have become increasingly common in recent decades as political brinkmanship has turned into a hallmark of budget negotiations. n nSince 1976, the U.S. government has experienced 20 shutdowns. The last shutdown occurred when a dispute over funding for President Donald Trump ‘s border wall brought government operations to a halt for 34 days, spanning from December 2018 into January 2019. n nAs the current shutdown extends beyond that record, its effects are being felt nationwide, from delays in funding for the Supplemental Nutrition Assistance Program (SNAP) to mounting pressure on the nation’s air travel system ahead of the busy Thanksgiving holiday. n nCLICK HERE TO GET FOX BUSINESS ON THE GO n nThe mounting stress on key sectors, Bessent warned, shows how the shutdown is beginning to affect Americans in their daily lives. n
“There’s, of course, the human cost,” Bessent said. “We’re going to have the busiest travel day of the year right after Thanksgiving, and Americans should look to five Democratic senators to come across the aisle.” n
He added that consumers could also face product shortages as cargo shipments slow because of the shutdown.