US government shutdown: Economy loses $15 billion per week
The US government shutdown could cost the economy up to $15 billion a week, Treasury Secretary Scott Bessent said on October 15, warning that the two-week political impasse is starting to "cut into the muscle" of the economy.
According to Reuters, speaking at an event on the sidelines of the annual conference of the International Monetary Fund (IMF) and the World Bank (WB) in Washington, Secretary Scott Bessent gave alarming figures of economic damage caused by the government shutdown.
The figure was later confirmed by a Treasury official as $15 billion a week, correcting Mr. Bessent's initial statement of $15 billion a day.
Mr. Bessent expressed optimism about the health of the U.S. economy, saying a wave of sustained investment, particularly in artificial intelligence (AI), is just beginning. He credited President Donald Trump’s policies, including Republican tax legislation and tariffs, with “unleashing this boom.”
But he stressed that the current situation is a growing obstacle. “The only thing slowing us down is the government shutdown,” Mr. Bessent said. He likened the current potential growth period to the late 1800s when the railroads were built or the 1990s when the internet boom took off.
In his remarks, Mr. Bessent also called on Democrats to "be heroes" and work with Republicans to end the shutdown.
Also at the event, the Treasury Secretary said the US budget deficit in fiscal year 2025 (ending September 30) has decreased compared to the previous year's figure of 1,833 billion USD.
“The key number is the deficit-to-GDP ratio, which is starting with five,” Mr. Bessent said, adding that the goal of getting it down to 3% in the coming years was “still doable” if the US could “grow more, spend less, and restrain spending.”
However, estimates from the Congressional Budget Office (CBO) last week showed that the US fiscal 2025 deficit would only decrease slightly to $1.817 trillion.
