October 11, 2013

Sally Katzen served in the Office of Management and Budget as administrator for the Office of Information and Regulatory Affairs from 1993 to 1998 and deputy director for management from 1999 to 2001. She is a senior adviser at the Podesta Group and a visiting professor at New York University School of Law.

In November 1995, as a senior policy official at the Office of Management and Budget (OMB), I sat at a table with OMB Director Alice Rivlin and Deputy Director for Management John Koskinenas we prepared for an impending government shutdown.

The questions we had to answer were: “Who’s essential?” and “Who’s non-essential?” Yes, we could close the national parks. But how to handle the federal prisons? We needed Agriculture Departmentinspectors at meat-packaging plants. But what about Food and Drug Administration inspectors at drug manufacturers? Meat can go bad quickly; most medications don’t.

Over several very long days, we came up with a plan that guided the federal government through two shutdowns — from Nov. 14-19, 1995, and from Dec. 16, 1995, to Jan. 6, 1996.

When those shutdowns were over, I hoped our country would never go through another one. Eighteen years later, I still vividly recall how excruciating it was to draw lines that had enormous consequences in what was, essentially, a meaningless exercise: All government services provide value to someone, and rather than picking and choosing what work to continue, the government should just be working.

The same meaningless exercise has repeated itself in recent weeks, to the detriment of federal workers, contractors, Americans nationwide, U.S. trading partners and more. I take little comfort in the fact that I was not the one to make the tough decisions this time around, let alone to implement the sequester-mandated budget cuts and other arbitrary “fixes” that really don’t fix anything.

But if shutdowns have any saving grace, Americans are learning three lessons:

First, as noted, the federal government does many important things that go well beyond the services, such as national defense, Social Security and air traffic control, that are deemed essential and thus continue during a shutdown.

That is why the Republicans in the House are trying to go on record as being for the reopening, piece by piece, of some of the most popular parts of government, including our national parks, the National Institutes of Health and the Department of Veterans Affairs.

Still, every day brings news of how supposedly “non-essential” services and employees are important for our country’s well-being.

For instance, the Centers for Disease Control and Prevention (CDC) has recalled furloughed disease detectives to address a major foodborne illness that has broken out. More than 315 cases of illness related to chicken contaminated by salmonella have been reported in 20 states. Thankfully, the lab work to combat this outbreak will not have to wait until the CDC fully reopens.

Second, the economic ramifications of government shutdowns are significant.

Using OMB figures, the Pew Research Center concluded that the 26 days of shutdown during the winter of 1995-96 cost the U.S. economy more than $1.4 billion. That’s $2.1 billion in 2013 dollars. The economic consulting firm IHS Global Insight projects that the current shutdown is costing about $300 million a day and $1.6 billion a week in work not done.

This loss comes amid the economy’s fragile recovery from the 2008 financial crisis. The unemployment rate for September could not be computed because the Bureau of Labor Statistics had to furlough its economists. But it’s well established that the economy is less prepared to withstand shutdown shocks today than it was in 1995-96, when the unemployment rate was less than 6 percent.

Third, a shutdown is the worst course of action if the goal is for government to operate more like the private sector.

No business would tolerate the uncertainty and needless costs imposed by a shutdown. And though federal employees probably will, eventually, be paid for their lost work, millions of dollars were wasted in planning for this shutdown and will be incurred for starting back up. Questions remain about what happens to work in process, time and schedule commitments and orderly planning.

Just as this is no way to run a business, it is no way to run a government.