Podcast Summary

Podcast: Business Daily
Host: Ed Butler, BBC World Service
Episode: The Cost of a Shutdown
Date: October 7, 2025

Overview

This episode of Business Daily explores the wide-ranging consequences of the ongoing U.S. federal government shutdown. Host Ed Butler investigates the lived reality for federal workers who are unpaid but required to work, the political dynamics blocking a resolution, and the growing hazards for the broader U.S. economy if the shutdown continues. With interviews from federal employees, union leaders, economists—including Nobel laureate Joseph Stiglitz—and real-time data, the episode delivers a ground-level and macroeconomic assessment of the shutdown’s impact.

Key Discussion Points & Insights

1. The Human Toll: Federal Workers in Limbo

• Rising Hardship and Anxiety

  • Many federal workers are forced to live without pay, creating instability and stress.
    • Doreen Greenwald (President, National Treasury Employees Union):

      “Grocery prices are up, gas prices are up. So people struggle day to day to just make ends meet and then to be faced with an unknown shutdown. It's causing a lot of anxiety for people. This could be an hour, this could be months.”
      — [00:54]

• Essential Workers Still Must Report

  • Firefighters, air traffic controllers, and others must work as "essential employees" without pay, relying on a promise of future back pay.
    • William, Federal Firefighter:

      “We have to show up to do my job whether I get paid or not. I'm a mandatory responder.”
      — [04:21]

    • Pay is severely inadequate (GS5, ~$16/hour), making it even harder when paychecks stop.

• Financial Strain

  • Workers are taking on debt, working multiple jobs, or draining retirement funds to survive.
    • “I'm a single father. I have to work two jobs normally to just afford rent and food in this state. And now one of those incomes is taken away.” — William, [05:04]
    • Loan and credit card usage is rampant among stressed employees:

      “Some people have taken out the loans on their retirement to get by. Some people have taken credit cards and maxed them out just to keep eating. It's insane.”
      — [05:47]

2. The Shutdown and Who’s To Blame

• Political Deadlock and Frustration

  • Congress is at an impasse: Republicans and Democrats are trading blame:
    • Republicans push a stopgap bill without compromise; Democrats refuse to accept it unless it contains protections for healthcare funding.
    • Mike Johnson, Republican House Chair:

      “Democrats could have worked with us in a bipartisan manner to avert this unnecessary and very harmful shutdown. But instead they prioritized taxpayer funded benefits for illegal aliens over keeping the government open…”
      — [06:42]

  • Doreen Greenwald criticizes the dysfunction:

    “Every one of these federal employees want to go to work, but they're prohibited...because Congress hasn't done their jobs.”
    — [03:42]

• White House Pressure on Democrats

  • The president threatens deeper program cuts and layoffs if Democrats don’t cooperate.
    • “We can do things during the shutdown that are irreversible. So they're taking a risk by having a shutdown because we can do things including benefits. We can cut large numbers of people out.” — [07:37]

• Who Gets Blamed?

  • Polling shows marginally more Americans blame the Trump administration, though there is pervasive frustration with both parties.

3. Economic Impact: How Bad Is It?

• Macroeconomic Effects

  • Each week of shutdown is estimated to trim 0.2 percentage points off national growth.
    • Past shutdowns show short-term GDP losses, typically recovered once resolved. Current GDP growth (Q2) appears healthy at 3.8%, but underlying fundamentals are weak due to stimulus distortions.
    • Stephanie Roth (Chief Economist, Wolff):

      “It was estimated that about $85 million per day of lost output [in the 2013 shutdown].”
      — [08:21]

• Uneven Impact Across Society

  • Top earners are thriving (stock ownership, wage growth), but the bottom 80% are struggling with higher prices for essentials.
    • Mark Zandi (Chief Economist, Moody's Analytics):

      “The folks in the top 10%...account for almost half the spending. But...the bottom 80%...their pay and their spending has barely kept pace with inflation. Inflation's up a lot. And it's for stuff they need.”
      — [12:38]

• Sectoral Challenges

  • AI and healthcare are strong; manufacturing, agriculture, mining, and transportation are in recession, exacerbated by Trump's tariffs and immigration restrictions.

• Data Blackout and Fed Blindness

  • The shutdown means key economic data is not produced, making it impossible for the Federal Reserve to set policy effectively.
    • Mark Zandi:

      “The metaphor in my mind is, you know, the economy is a plane. The Fed is the pilot. Pilot's got all these instruments...And now all the instrumentation is out and they're flying the plane in a storm.”
      — [01:22], [14:38]

4. Political & Personal Consequences

• Loss of Confidence and a Fragile Economy

  • Joseph Stiglitz (Nobel Laureate Economist):

    “Confidence is low. This will clearly undermine confidence even more. Workers...may call in sick, even if they will get paid eventually...Long lines at the airport would discourage people from flying...So this has induced a very peculiar interruption into the economy.”
    — [15:38]

    • Believes the shutdown will ultimately rebound politically on President Trump, given the nature of Democratic demands and public sympathy.

• Enduring Commitment Amid Hardship

  • Despite adversity, public service ethos remains strong but battered.
    • William:

      “The idea of public service? No, but maybe. Who for?”
      — [20:09]

Notable Quotes & Memorable Moments

• William’s raw frustration (Federal Firefighter):

  “I'm going to say it. It's criminal how low we're paid for what we actually do and what we actually respond to.” — [04:46]

• Mark Zandi on the Fed’s current predicament:

  “The economy is a plane. The Fed is the pilot...And now all the instrumentation is out and they're flying the plane in a storm.” — [01:22], [14:38]

• Joseph Stiglitz on the shutdown’s effect:

  “If it extends, that will cast a big power over the economy, over our society. It will provide further evidence about Trump's governing in a chaotic way, not knowing how to manage the normal process of compromise.” — [16:48]

• William’s motivation for speaking out:

  “How come I'm talking to you? Because, quite honestly, you're listening. I mean, it's almost like we're all gagged to just take it. And I'm not that kind of guy.” — [19:44]

Important Timestamps

| Timestamp | Segment | |-----------|---------------------------------------------| | 00:54 | Doreen Greenwald: Impact, anxiety | | 02:12 | William: Firefighter’s hardship | | 03:02 | Greenwald: Shutdown affects services | | 04:21 | William: Essential workers remain unpaid | | 06:42 | Mike Johnson: Political blamegame | | 08:21 | Stephanie Roth: 2013 economic analogies | | 10:25 | Mark Zandi: Unemployment & sector impacts | | 12:38 | Zandi: K-shaped (unequal) recovery | | 13:51 | Zandi: Data blackout’s ripple effects | | 15:38 | Stiglitz: Shutdown undermines confidence | | 18:47 | William: Why he stays, commitment to family | | 19:44 | William: On the record for those unheard |

Tone

The episode blends urgency, frustration, and concern. Federal workers' voices are raw and impassioned, economists provide grave assessments delivered with candor, and the host maintains a clear-eyed, empathetic approach in guiding listeners through both the human and systemic stakes of the shutdown.