Look At What Gets Affected In A Government Shutdown, And You'll See Why It Could Last A Long Time

This follows a late night vote from the GOP which tied funding of the government to a delay in Obamacare, a tradeoff that Democrats will not accept.

So what happens in a government shutdown anyway.

The AP has a nice rundown of what stays open and what doesn't.

And if you look at it, you'll start to realize that a shutdown could go on for awhile.

For example, air travel is unaffected in a shutdown. There won't be extra-long lines at the airport or anything like that, so one of the most obvious places where a citizens lives intersects with bureaucracy doesn't change. Even international travel isn't affected, since stuff like applying for visas and passports is paid for by fees.

All government benefits, for the most part, remain paid: Unemployment, Social Security, Medicare keep writing the checks as usual.

The National Parks service along with Museums in DC will be closed down, so this is one highly-visible nuisance to a lot of people. But the majority of people never go to these, and since this is October, we're not exactly talking about some big tourism season.

Meanwhile, the mail stays open, rocket control stays open at NASA. Most military and veterans services would get paid.

Some routine FDA food safety inspections might stop, but high-risk situations and meat inspections would go on.

There's more but the gist is, there's no obvious one thing that will be so annoying to the public that the two sides would have to come to a deal.

One thing that would hurt is that first-time homebuyers wouldn't be able to get FHA loans, so this might put pressure on the real estate industry to apply pressure to DC so that helps.

Yesterday, we published a paragraph from Bank of America analyst Ethan Harris, who is concerned about a sustained and damaging government shutdown. He wrote:

As in the past, we worry that if they do cross the Rubicon-and start a shutdown-what will get them to turn back? If they have decided that the political calculus is in their favor, what will make them decide it no longer is? In our view, it might require either a major popular outcry or a major stock market correction. Recall that as the fiscal cliff approached at the end of last year, one popular view was that the fiscal cliff was really a "slope"-it would impact the economy slowly and that any damage could be easily reversed. That kind of attitude is what could cause a really damaging sustained shutdown.

Looking at the above, and you can see why he's concerned.

Every week the government shuts down, 0.15% is shaved off of annualized GDP. This will hurt the economy, but won't be so immediately painful that obviously both sides will rush to get things solved.