US shutdown Day 2: What’s happening, who’s affected and why it matters

White House budget director Russ Vought, announced it was putting on hold roughly USD 18 billion for New York transit projects, including the New York’s subway and Hudson Tunnel projects, and USD 8 billion for green-energy programs across 16 Democratic-led states, including California and Illinois.

US President Donald Trump’s administration on Wednesday froze USD 26 billion intended for Democratic-leaning states, following through on its threat to use the shutdown to hit Democratic priorities.

Economic data, federal workers at risk

The shutdown will delay key economic reports, including the monthly jobs report and weekly unemployment claims, at a time of uncertainty for the US economy. The Congressional Budget Office estimates roughly 7.5 lakh federal workers could be furloughed on any given day, resulting in a daily loss of USD 400 million in wages.

White House officials have indicated layoffs could begin soon if the shutdown persists beyond a few days. Some federal agencies have already posted messages attributing the shutdown to Democrats, while Democrats counter that their focus remains on preserving health care funding under the Affordable Care Act to prevent a spike in insurance premiums nationwide.

Political standoff continues

Congress has not scheduled action Thursday in observance of the Jewish holy day. However, Democrats insist on maintaining health care subsidies, while Republicans have opened the possibility of negotiation but suggest it can wait until later in the year.

President Trump’s administration continues to assert control over federal funds, directing spending to priority programmes such as defence and immigration enforcement while withholding funds for projects favoured by Democrats. House Democratic Leader Hakeem Jeffries and Senate Democratic Leader Chuck Schumer in a joint statement, said, “After months of making life harder and more expensive, Donald Trump and Republicans have now shut down the federal government because they do not want to protect the healthcare of the American people.”

(With inputs from AP, Reuters)