Federal agencies in the financial and retirement areas may face significant hurdles if the government shuts down this weekend, which is becoming increasingly likely as Congress continues to scramble for a solution.
If Congress can't reach a deal to continue funding the government, the shutdown would begin at 12:01 a.m. on Oct. 1.
And according to reporting from Bloomberg, House and Senate Republicans are not on the same page. While House Speaker Kevin McCarthy is focused on making a deal involving border issues and further federal spending cuts, Senate Minority Leader Mitch McConnell is backing a bipartisan plan in the Senate.
Many Democrats expressed their concerns over the impending shutdown on Sept. 27, when SEC Chair Gary Gensler testified before the House Financial Services Committee.
"The chairman just indicated that his patience is running thin," ranking member Maxine Waters, D-Calif., said in the hearing, referencing Chair Patrick McHenry's opening statement, in which the North Carolina Republican said he's losing his patience with the SEC.
"Mine is thinner with the opposite side of the aisle and at the extreme MAGA Republicans who have taken over the House of Representatives and who are gleefully forcing the government of the greatest country in the world to shut down and forcing millions of government workers … to work for free or not at all," Waters said.
Gensler told the committee that if the government were to shut down, the SEC would be reduced "to a small, skeletal staff," with 92 to 93% of employees furloughed. "Normal oversight of the markets, given this, will not be possible in the SEC" during a shutdown, he added.
For companies looking to go through the initial public offering process, Gensler said the SEC "won't be able to really review the documents" for that, though IPOs are "so critical to capital formation."
The agency will keep open its tip, referral and complaint lines as well as its comment files, but "we won't really have individuals behind the scenes to follow up," Gensler added.
"It's going to be the Wild West on Wall Street, all while we're fighting for capital with other countries and other capital market systems, and we put up a sign that says (we're closed). I can't think of a worse thing we could do to American capitalism," Rep. Brad Sherman, D-Calif., said during the hearing.
Separately, if the government shuts down, the Bureau of Labor Statistics would completely cease operations, according to a Labor Department contingency plan, meaning they might not produce the monthly employment report, scheduled for Oct. 6, or the consumer price index, scheduled for Oct. 12.
If there is a government shutdown that lasts until the next Federal Reserve meeting, "then it's possible we wouldn't be getting some of the data that we would ordinarily get, and we would just have to deal with that," Federal Reserve Chairman Jerome Powell said at a Sept. 20 news conference, according to a transcript.
The next Federal Open Market Committee meeting is set for Oct. 31-Nov. 1.
The Labor Department's Employee Benefits Security Administration would furlough 743 of its 908 employees in the event of a shutdown, according to the Labor Department's contingency plan. EBSA oversees private retirement plans as well as other employee benefits.
While the Social Security Administration would furlough more than 13% of its employees in a shutdown, Social Security payments would not be affected. The SSA will only "cease activities not directly related to the accurate and timely payment of benefits or not critical to our direct-service operations," according to its contingency plan.
The longest government shutdown to date was also the most recent, spanning five weeks from December 2018 to January 2019 under the Trump administration.
