Glinkonomics, life this week on WSB radio, Ilyce talks about the government shutdown and which 10 states have been hit the hardest.
Amid the federal government shutdown, life’s been going on and states that have been hit the hardest are starting to step in. New York agreed to reopen the Statue of Liberty to the public on Sunday. Other states are stepping forward to open national parks as well. It isn’t just about the parks being closed; it’s about all of the people out of work who run the parks. There is a significant ripple effect when only one park closes, so imagine what’s happening with most of them closed.
We have seen many different ways that the government shutdown is affecting the economy. It’s costing taxpayers millions of dollars each day, and some states are feeling the effects more than others. Here are the 10 states that have been hit the hardest.
The tenth most affected is Hawaii. It’s first in the real estate category because housing is everything in Hawaii. Staffing shortages at the Federal Housing Administration and the inability of lenders to verify income through tax returns could delay closings.
The ninth most affected is Idaho. It’s also ninth of states with the most federal contracting dollars per capita, and eighth for Small Business Administration loans. During the furlough period, non-excepted employees at the SBA will no longer be allowed to use SBA email or other federal resources, which will delay the loan process.
The eighth most affected is Colorado. It has heavy exposure to Small Business Administration loans and federal contracting dollars.
7. New Mexico
The seventh most affected is New Mexico. It’s sixth amongst states with the most federal employees per capita, which means local economies are affected because people aren’t getting paid. It’s also ranked fourth for the most federal contractors.
The sixth most affected is Maryland. It has the second highest amount of federal employees per capita, and the fourth most federal contract dollars per capita. In addition, it’s the third state most heavily exposed to the real estate market.
The fifth state hit the hardest is Maine. It has heavy exposure to SBA loans, Social Security funding, real estate and it’s the fifth state with the most veterans per capita.
4. District of Columbia
Even though it’s not a state, the capital of the United States is the epicenter of everything and ranks fourth. It’s most affected when it comes to federal employees per capita because everybody lives and works locally.
The third most affected is Alabama. It places fourth with the most Social Security funding, and eight for the most FAFSA applications per capita. The shutdown hasn’t affected Social Security payments, but will the benefits get interrupted if we hit the debt ceiling?
The second most affected is Alaska. It places third with the most federal employees per capita and federal contracting dollars per capita. It’s the fourth most affected for the disruption of SBA loans. Even though there are only 560,000 people in the entire state, they may have the most veterans per capita. Therefore, 3.8 million veterans will not receive their disability payments next month if the government shutdown extends into late October.
The state considered to be hit the hardest is Virginia. It has heavy exposure to federal employees, federal contracting dollars and Virginia has the second most veterans per capita.
The shutdown isn’t just about the US economy; it’s an issue worldwide. There is global uncertainty, and the longer the shutdown continues the more uncertainty there is, and the more nervous world markets are going to be.
The finance ministers and the central bank governors from around the world said, the US needs to resolve its budget impasse to remove the dark cloud of default hanging over the global economy.
WSB Radio’s Ilyce Glink Show – October 13, 2013
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