What carriers and drivers should understand about the government shutdown

The failure of Sen. McConnell (R-KY) and Sen. Schumer (D-NY) to strike a budget deal caused parts of the federal government to shut down.

On Saturday night at midnight, the federal government hit a funding lapse that triggered a widespread shutdown of non-essential functions. Senate Democrats wanted protections for DACA (Deferred Action for Childhood Arrivals) recipients included in the budget bill; the Republicans wanted to separate that issue from funding the government and try to resolve it later. 

Government shutdowns bring to mind a chaotic situation in which departments and agencies, having run out of money, abruptly cease operations and furlough all their employees. The reality, though, is far from the truth. In part because of America’s polarized political system, government shutdowns are not all that uncommon—since 1980 the government has experienced appropriations lapses that resulted in at least partial shutdowns with workers furloughed for at least a day on nine different occasions. Over the decades, congressional appropriators and federal agencies have learned how to plan and manage these funding gaps so they go as smoothly as possible.

The most painful outcome, the one everyone is trying to avoid, is a massive economic disruption that costs the country billions of dollars. The good news is that won’t happen. While you may not be able to get your Freedom of Information Act request processed or have a park ranger guide your tour of Yellowstone, the list of exempted government functions that stay up and running is surprisingly long. You can still get your passport renewed because the office that processes passports and visas are self-funded through fees; your federal court date hasn’t been canceled because the federal judiciary still has weeks of funding left; airplanes are still flying because more than 25,000 FAA employees are ‘excepted’ from furloughs.

Freight, whether it’s on a truck, plane, ship, or train, will continue to move. The Federal Highway Administration and the Federal Motor Carriers Safety Administration are funded by the Highway Trust Fund and are not vulnerable to lapses in annual appropriations. Roadside enforcement, scales, and inspections are run by state agencies which won’t be affected in the short-term by the federal shutdown. Customs and Border Patrol keep about 90% of their staff during a government shutdown, so apart from some longer lines and minor delays, truckload border crossings will continue as normal.

Nearly half of the Federal Railroad Administration’s ~860 employees will be furloughed, though, because that agency does not have a trust fund. The Federal Railroad Administration conducts and manages all rail accident/incident investigations across the country, and then issues Emergency Orders and Safety Advisories based on those incidents, and also holds the responsibility for developing new rail safety regulations. The FRA’s inspectors also maintain a continuous presence on railroad property to review and identify unsafe operations and ensure regulatory compliance. All of those critical safety functions will continue during the shutdown—suspended operations include the Office of Railroad Policy and Development, which studies high-speed rail, and grants operating, capital, and debt services payments to Amtrak. Amtrak can self-fund for a few weeks on ticket sales alone before it will run out of money.

There are a few other offices in the Department of Transportation that will see significant furloughs, but over the short term these won’t affect the movement of freight. For instance, the majority of federal workers at the Pipeline and Hazardous Materials Safety Administration (PHMSA) are furloughed, but pipeline accident investigations, inspections, regulatory enforcement, and hazardous materials accident investigations, inspections, and regulatory enforcement all continue as normal. Suspended activities include functions like strategic planning, pipeline standards and rulemaking, engineering and research programs, training programs, and approvals and permits for hazardous materials.

The federal government has had a lot of practice managing shutdowns to minimize economic impact and maximize political theater. While Washington, D.C. politician blame-game goes around and around, for the vast majority of the transportation and logistics industry, it’s just another Monday. 

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John Paul Hampstead, Associate Editor

John Paul writes about current events and economics, especially politics, finance, and commodities, and holds a Ph.D. in English literature from the University of Michigan. In previous lives John Paul studied Shakespeare in London and Buddhism in India, but now he focuses on transportation and logistics in the heart of Freight Alley--Chattanooga. He spends his free time with his wife and daughter herding cats, collecting books, and walking alongside the Tennessee River.