The government shutdown in 2013 devastated the economy, and Main Street is still recovering. The shutdown was a disturbing example of Congress’ willingness to prioritize political gain over national wellbeing. Now, just a few months since the new Congress has taken power, we’re again facing a shutdown if legislators fail to reach a deal on the debt ceiling before the March 15 deadline.
As the owners of independent retail stores, we understand the impact of government shutdowns all too well. In the months preceding and following 2013’s 16-day government shutdown, our respective businesses, Paloma Clothing and Hobby Works, took huge hits. At Paloma Clothing, sales fell flat in late 2013 despite a significant investment in store improvement earlier that year. At Hobby Works, sales fell more than 10 percent in late 2013, and plummeted an additional 17 percent in early 2014. The economic stress forced Hobby Works to consider what our future held, despite the fact that the company has been around for more than 30 years and weathered several previous recessions.
{mosads}The two of us weren’t alone in feeling the financial impact of the shutdown. Spooked consumers drastically cut spending, and the shutdown cost our economy approximately $24 billion. Small businesses, as usual, bore the brunt of this slowdown. Without the resources of big businesses, we struggled to ride out the storm.
Thankfully, our economy received a welcome break from government dysfunction in 2014. Last year’s relative stability translated to a strong economy, which we experienced firsthand. As consumers grew more confident, our businesses saw marked improvement in sales. Paloma Clothing gained an 8 percent increase in sales compared to 2013, and Hobby Works broke all of our previous holiday sales records with unprecedented December sales.
The bad news is it looks like this political calm – and the accompanying economic prosperity – may not last through 2015. While Congress managed to avoid a shutdown late last year by reaching a timely spending deal, the March 15 deadline for reaching a deal on the debt ceiling is rapidly approaching. As of now, Congress is offering no clear path to a solution.
Given the economic impact of government dysfunction, it’s hardly a surprise that small business owners as a group have shown tremendous support for solutions to reduce harmful partisan gridlock. A poll from Small Business Majority found that by a 3:2 margin, entrepreneurs want a long-term solution to our recurring debt-ceiling issue, with 55 percent agreeing that this ongoing issue allows politicians to hold the economy hostage to their own spending priorities and threatens America’s credit rating.
The day after Republicans won the House and Senate majority, Senate Majority Leader Mitch McConnell (R-Ky.) promised responsible governing, saying, “Let me make it clear: There will be no government shutdowns.” And yet, mere months later, we’re again facing the same type of dysfunction we saw in 2014. We – and our fellow small business owners – are counting on Congress to pull together and avoid political drama. We can’t afford to continue electing people who value partisanship over our national prosperity.
Brey is the owner of Hobby Works and a member of Small Business Majority’s Small Business Council. Roach is co-owner of Paloma Clothing, a member of Small Business Majority’s Small Business Council and a member of the NFIB.