Article Analysis Essay on Effects of the US Five-Week Federal Government Shutdown

Introduction

On January 28th, 2019, the New York Times published an article representing the effects of the US five-week federal government shutdown (Rappeport & Appelbaum, 2019). According to Rappeport and Appelbaum (2019), the five-day shut-down had negative impacts on the US economy, costing it a total of $11 billion. The article further states that 25% of the $11 billion was permanently lost according to the CBO reports. Similarly, the article stated that the costs from the shutdown were nearly 200% of the initial request by president trump. Consequently, the article states that the loss incurred would lead to economic effects, mainly reducing the first-quarter economic growth by 0.4%. Similarly, the article states that even though 75% of the money lost was merely delayed and would flow back into the economy following the resumption of work, there was a high possibility of the remaining 25% to be permanently lost, hence leading to the more prolonged effect of the shut-down.

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According to the article, Mr. Trump had threatened to shutter the government if it failed to meet his demand for a wall. Consequently, most of the civil workers had chosen to spend less of their income as a way of protecting themselves from antici[pated future risks. The report further stated that the five-week shutdown resulted in a reduction of the US gross domestic product (GDP) by three billion US dollars in the last quarter of 2018. It also led to a decrease in GDP by $8 billion in the first quarter of 2019. Rappeport and Appelbaum (2019) reported that the shutdown would further harm the US economy, which was already expected to record a decline in the GDP to 2.3% in 2019 compared to 3.1% GDP of 2018. The result would lead to the federal budget hitting $900 billion. The article also stated that the federal government-held debt is expected to continue growing such that by 2029, the country will have the highest percentage. However, the National Economic Council, through its director, Larry Kudlow rejected the CBO report irrespective of several stakeholders (government workers government officials) admitting to the stress of the shutdown.

Descriptive Statistics

Descriptive statistics help in analyzing data and presenting them in a way that they can easily be understood by the reader (Winkler, 2009). In the article, the descriptive statistics, especially the measures of frequency is used. The article uses percentage to present the effects of the five-week shutdown on the economic performance of the US. The article also shows the trend in the GDP of the country form 2018 and the projected debt percentage of the US to GDP for the next decade. This helps the reader to understand the extent that the shutdown has on economic performance. For instance, one would not get the actual effect if it was only stated that the closure led to the economy losing $11 billion since one might assume the country has more funds. However, when the effect is presented in percentage terms, the reader understands the real impact of the shutdown on economic performance.

Application of Future Career Goal

My future career goal is to be an economist analyst. The article analyses the economic events using descriptive statistics and then presents them to the real world in languages that they can efficiently synthesize. In turn, the output of the analysis leads to effective communication with the real-world stakeholders (Holcomb, 2016).

Reasons for the Data Shared

The article chose to use the data shared to demonstrate the effect of unexpected disruptions in the economy of a nation. The data also helped in describing the factors that affect GDP and to help readers be in positions of tracking the performance of the US economy.

References

Holcomb, Z. C. (2016). Fundamentals of Descriptive Statistics. Los Angeles: Taylor and Francis.

Rappeport, A. & Appelbaum, B. (2019). Government Shutdown Cost U.S. Economy $11 Billion, C.B.O. Says. New York Times. Retrieved from https://www.nytimes.com/2019/01/28/us/politics/shutdown-cost-us-economy-11-billion-cbo-says.html

Winkler, O. W. (2009). Interpreting economic and social data: A foundation of descriptive statistics. Dordrecht: Springer.