US government shut-down

Well, the big news is that the US government has shut down because the two chambers of Congress could not come up with a solution to the budget problems that satisfied everybody.

Picture source: The Economist. 

The argument essentially was that the Republicans (or even more specifically the Tea-Party wing) wanted to delay, or overturn or defund Obamacare, and the Democrats said they couldn't.

There are a whole lot of different topics in G & P units 3C and 4C which could use this event as an example; the power (or inadequacy) of Congress, the power of the President, Political parties and their factions, not to mention the Supreme Court which upheld Obamacare in the face of challenges to it.

Interesting commentary from the Republican-leaning Washington Post which blames the Tea Party for having no grasp of political reality. Elsewhere on the Washington Post web-site there is older analysis which says that this plays into the hands of the Democrats and President Obama, as does this post.

The Economist's Democracy in America blog has a piece here about the political implications of the shut-down.

The BBC's Robert Peston has analysis of the economic impact of this.

Update:

The Huffington Post has a poll of polls which says that thanks to the Government shut-down the Republican Party is losing support and is in danger of losing the House in the Mid-terms next year. This may or may not have an impact on the shut-down itself; the Republican Party may decide to suspend the shut-down or it may decide to keep squeezing.

The decision on the debt ceiling will have to be made by 17th October or there is a risk that the US government will default on its debt.

Wikipedia's article on the subject can be found here.