Berliner Boersenzeitung - US government shutdown may last weeks, analysts warn

As the nation enters its second week with federal agencies paralyzed, multiple strategists with vivid memories of previous standoffs told AFP the president and his foes could be in it for the long haul.

"It's possible this shutdown drags on for weeks, not just days," said Andrew Koneschusky, a former press secretary for Senator Chuck Schumer, the Democratic leader at the center of the latest deadlock.

"Right now, both sides are dug in and there's very little talk of compromise."

At the heart of the showdown is a Democratic demand for an extension of health care subsidies that are due to expire -- meaning sharply increased costs for millions of low-income Americans.

On Sunday, Trump blamed minority Democrats for blocking his funding resolution, which needs a handful of their votes.

"They're causing it. We're ready to go back," Trump told reporters at the White House, sounding resigned to a shutdown dragging on.

Trump also told reporters Sunday his administration has already started to permanently fire -- not merely furlough -- federal workers, again blaming his rivals for "causing the loss of a lot of jobs."

In March, when the threat of a shutdown last loomed, Democrats blinked first, voting for a six-month Republican resolution to keep the coffers stacked despite policy misgivings.

But Schumer -- the top Senate Democrat -- was lambasted by the party's base, and will be reluctant to cave this time around as he faces potential primary challenges from the left.

- 'Maximum pain' -

For now, Senate Republicans are banking on their Democratic opponents giving in as they repeatedly force votes.

"I could see a temporary agreement coming from both parties by the end of October," said Jeff Le, a former senior official in California state politics who negotiated with the first Trump administration.

"Anything beyond two months would halt government operations seriously and potentially impact national and homeland security considerations, casting blame on both parties."

A shift in the strategy would likely depend on either side noticing public sentiment turning against them, analysts told AFP.

Polling so far has been mixed, although Republicans have been taking more flak than Democrats overall.

Trump presided over the longest shutdown in history in 2018 and 2019, when federal agencies stopped work for five weeks.

This time around, the president has been ratcheting up pressure by threatening liberal policy priorities and mass layoffs of public sector workers.

- The Trump factor -

James Druckman, a politics professor at the University of Rochester, sees Trump's intransigence as a reason to believe this standoff could rival the 2019 record.

"The Trump administration views itself as having an unchecked mandate and thus generally does not compromise," he told AFP.

"Democrats have been critiqued for not standing strongly enough and the last compromise did not result in any positive outcome for Democrats. Thus, politically, they are inclined to stand firm."

The 2018‑2019 shutdown cost the economy $11 billion in the short term, according to the nonpartisan Congressional Budget Office -- and $3 billion was never recovered.

US Treasury Secretary Scott Bessent has warned that the latest shutdown could wreak its own havoc on GDP growth.

For California-based financial analyst Michael Ashley Schulman, the economic realities of the shutdown may be what end up forcing compromise.

"If Wall Street gets spooked and Treasury yields spike, even the most ideologically caffeinated will suddenly discover a deep commitment to bipartisan solutions," he said.

Not all analysts are gloomy about the prospects for a quick resolution.

Aaron Cutler, head of the congressional oversight and investigations practice at global law firm Hogan Lovells, and a former staffer in the House, sees the shutdown lasting 12 days at most.

"Senate Democrats will blink first... While the shutdown continues, there will be no congressional hearings and a lot of work at the agencies will be paused," he said.

"That's a win for many Democrats in Congress but they don't want the blame for it."

(Y.Yildiz--BBZ)