What led to the US government shutdown and what does it really mean?

The shutdown may not end until the new year as Trump refuses to budge on his demands, but the standoff has started affected federal employees.

The US government remained partially shutdown on Christmas, as lawmakers were out of office celebrating the festival and negotiations could not make any progress. President Donald Trump's demand that Congress assign $5 billion for a wall along the border with Mexico is at the center of the dispute.

Trump on Tuesday said the partial shutdown of the federal government would continue until his demand for the border wall was met.

Under the United States Constitution, the appropriations bills should be introduced in the House and approved in the Senate. The final version approved by both chambers then goes to the president. If the president approves the bills they will become law. 

However, the president of the US can shutdown the government if he is unable to resolve disagreement gap between demanded and offered budget of federal agencies. 

Does it affect anyone?

Not many federal employees were affected, as the government agencies weren't open over the weekend and on Monday and Tuesday because of federal holidays. But starting later this week at least 800,000 government employees who are not deemed "essential" are likely to be furloughed or forced to work without pay. They will have to work in without compensation until the standoff is resolved. 

Department of the Treasury, Department of Agriculture, Homeland Security Department,Department of the Interior, Department of State, Department of Housing and Urban Development, Department of Transportation, Department of Commerce and Department of Justice, all rendered defunct by Trump's shutdown decision. 

The government shutdown can have a negative impact on the US economy. According to the statement of the Office of Management and Budget, the 2013 government shutdown had some impacts on the economy during Obama presidency.

The shutdown in 2013 was one of the longest ones in the US history.

Nearly 850,000 workers were furloughed at that time.  “The payroll cost of furloughed employee salaries alone – that is, the lost productivity of furloughed workers – was $2.0 billion,” the statement read.

The shutdown can also hurt the private sector. In 2013, 120,000 private jobs were snuffed out in just two weeks of standoff. 

From import and export licence applications to federal loans to small business or homeowners were also delayed during the 2013 shutdown.There were adverse effects on banking sector as well.

What's next?

The Senate is scheduled to reopen Thursday. The senate majority leader Mitch McConnell, however, has taken a strict position, saying he won’t allow lawmakers vote unless there is a compromise bill. 

The House Democrats seem unwilling to come to the table with little incentive in view. The Democrats are set to take over the majority  in early January, so a legislation to reopen the government is on the cards.