Furlough Inferno: The Crazy Inconsistencies Of A Government Shutdown

WASHINGTON: This summer’s unpaid leave for federal workers was unpleasant enough. If the government shuts down October 1^st, though, this fall’s furloughs are just going to be crazy. A patchwork of legal exceptions and grey areas will not only prevent most federal civilians from getting work done but, indirectly, keep many military servicemembers from getting trained as well, Pentagon Comptroller Robert Hale warned today in a Pentagon press conference.

“These furloughs are very different from the sequester furloughs that occurred this summer,” Hale told reporters, potentially tens of thousands of anxious civilians watching via webcast, and — perhaps the most important audience of all — Republican Congressman watching from the Hill, whom the administration certainly hopes to scare into backing down. (Detailed documents on the Pentagon’s shutdown plans have already been released). The automatic cuts to the 2013 budget, known as sequestration, forced the Defense Department to put almost all of its 800,000 civilian workers on six days of unpaid leave this summer. (Uniformed military personnel were exempt). But, Hale noted, at least the Pentagon has some wriggle room in policy to meet the cost targets set by the sequester law, flexibility that allowed it to shave the unpaid days per worker from 22 to 11 and finally down to six.

This time, however, the duration of the furloughs will be governed entirely by how long the government stays shut down, which means however long it takes for Congress to pass some kind of spending bill. (That will almost certainly not a proper appropriations bill covering all of fiscal year 2014 but rather a stopgap continuing resolution of the kind passed last year and currently being debated between the House and Senate.)

What’s more, the sticky specifics of who gets leave without pay, who has to keep working for an IOU, and who keeps getting paid as usual is governed strictly by federal law, with no leeway for the Pentagon to make policy choices. That creates a crazy quilt of different categories.

“Roughly half of our civilian personnel” will be put on unpaid leave, said Hale. “Around 400,000, a little bit less.” After past shutdowns, Congress eventually voted to pay such furloughed workers back, but that costs money. In the current budget crisis, it’s tempting just to send half the workforce home and keep the cash.

Another half of the civilian workforce, however, is essential to vital activities that cannot be interrupted, from the waging the war in Afghanistan to fighting fires on US bases. Those “excepted” personnel have to keep working – but they won’t actually get paid for their work until Congress passes that spending bill. Until Congress appropriates the funds, the government can “obligate” money for the excepted activities – that is, to commit to paying someone to do them – but none to actually “disburse” it – that is, to actually pay anyone. (It’s in the Constitution, Article I, Section 9: “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.”) The same holds true for military personnel: By law, they cannot be put in a “non-pay status,” so they’ll keep on working, but they won’t be paid until Congress gets its act together.

“Paychecks don’t go out, but the troops would,” said summed up Todd Harrison, budget expert at the Center for Strategic and Budgetary Assessments.

Put more bluntly, “a shutdown would require our troops to go into combat while receiving only an IOU,” fumed Democratic Sen. Carl Levin in a statement, urging his House Republican counterparts to end “the legislative anarchy.”

For most military personnel, this is really more of an annoyance than a crisis, unless the shutdown lasts for multiple pay cycles. For poorer, lower-ranking troops, however, especially those with kids, it will start to hurt at once. “For some families, that’s going to become painful almost immediately,” Harrison told me. “If they’re living paycheck to paycheck, they can’t afford a paycheck being a week late.”

“The government may shut down,” Harrison said, “but your monthly bills don’t slow down. The rent is still going to be due at the end of the month, the car payments are still going to be due, insurance payments are still going to be due.”

On the flipside, however, there are plenty of people who will keep getting paid as usual – at least for a while. Over 100,000 “indirectly funded” federal employees are paid out of “working capital funds,” activities that don’t get their own line in the budget but instead get paid for goods or services – such as maintaining military equipment – by other parts of the Defense Department out of their budgets. Since the customer agencies wrote their checks before the shutdown hit, the working capital funds can keep working until that capital runs out.

The same holds true for contractors. They’ll keep working and keep getting paid because their contracts were signed, and the money disbursed, before the shutdown. At some point that money will run out, of course, but for the biggest defense contracts the pipeline can be awfully long: Major procurement programs, for example, are often only now spending money appropriated by Congress a two or even three years ago.

On the other hand, near-term training may be hit hard. Troops in Afghanistan or getting ready to go are excepted from the shutdown, as are ships standing by in the Mediterranean for potential strikes on Syria. But training for all other units – already slashed by the sequester – would not be excepted because it’s not directly related to the war. “I think most of the ships at sea would stay there,” Hale said, but it’s quite possible some that have sailed out purely to train in US waters may have to return to port.

Although the military personnel themselves wouldn’t be furloughed, many of the civilians who support training activities would be, Harrison explained. Nor would the government be able to pay for much of what it needed to run the training facilities.

Training, maintenance, and a host of other non-excepted activities across the government would have to pack it in, shutting down and restarting later when the funds come in – which will probably cost more than just keeping the everything going. And the government has already spent “thousands of hours” on planning for the shutdown, Hale said, all of it arguably wasted effort that could have better been spent actually improving national security.

Agreed Harrison, “we would like to be talking about where do we make smart investments and a better defense strategy and instead we’re talking about limping from crisis to crisis.”

Even if Congress solves the shutdown crisis, Harrison pointed out, there’s another one less than three weeks away: the federal debt ceiling. The Treasury will run out of expedients to keep paying its bills by October 17^th, according to the latest estimates, and if Congress does not raise the debt ceiling by then, the federal government will start defaulting on its debts for the first time in 237 years. The resulting shockwaves through the national and indeed global economy would make a shutdown look like small and painless potatoes by comparison.

Then, if and when Congress solves both of October’s crises – the shutdown and the debt ceiling – it still has to deal with sequestration no later than January 15^th. Orders to implement the sequester cuts must go out 15 days after Congress adjourns its current session, Harrison explained, and Congress must adjourn by the end of the calendar year – though it could also knock off earlier.

“I hope we are all wasting our time planning for this,” said the weary-looking Hale, who’s already been through multiple budget drills to deal with sequestration even before the potential shutdown started looming. But at least this shutdown plan looks a lot like the last one from 2011, he said: “Unfortunately, we’re getting good at this.”