As the government shutdown persists with scant prospects for a swift resolution, a scenario involving the U.S. military might compel the battling sides in Washington to reach a consensus.
No, troops will not be mobilized to coerce Congress back into action.
Nevertheless, an impending paycheck due in mid-October for the 1.3 million active-duty military personnel may persuade lawmakers and the White House that forgoing this date would incur unacceptable political backlash.
“We anticipate that the military pay date on Oct. 15 may serve as a crucial motivator for reaching a compromise regarding funding and expect the shutdown will conclude by mid-October,” Goldman Sachs economists Ronnie Walker and Alec Phillips noted in a report to clients.
The Wall Street institution observed that prediction markets are indicating a high likelihood that the shutdown will extend beyond the deadline. Polymarket shows a 71% chance that the shutdown will continue past Oct. 14.
While both sides remain entrenched over the fiscal budget, missing a payroll period could ignite public ire. At the very least, it may lead to a temporary measure known as a continuing resolution, allowing the government to function, according to the Goldman economists.
If that does not happen, it could signal an even more protracted deadlock.
“We forecast that pressure will mount on both factions to achieve a resolution before then,” they stated. “However, if this pressure results in a different outcome — the Dept. of Defense might find means to compensate troops despite the funding gap, or Congress could face pressure to sanction funds for that specific matter — there are limited other forcing events on the horizon that might facilitate a restoration of funding.”
These insights come amid bleak prospects for a resolution.
The Senate has planned a vote for Monday at 5:30 p.m., yet analysts anticipate minimal advancements. President Donald Trump has warned that, should no agreement be formed, some of the temporary layoffs resulting from the impasse could turn into permanent job losses.
There are numerous factors that could compel Congress to act beyond military compensation. Data releases that policymakers depend on have been halted, airport delays are a possible concern depending on whether Transportation Security Administration employees report for work, and most other government functions are suspended pending a resolution.
Nonetheless, there are apprehensions that neither faction will relent.
“Fears regarding military pay, TSA operations, or delayed mortgage payments for service members could serve as triggers for establishing a compromise,” Ed Mills, Washington policy analyst at Raymond James, noted in a report. “While a short-term continuing resolution remains the most probable scenario, we do not dismiss the possibility of a prolonged shutdown extending until November.”
Other critical dates to observe include a potential Oct. 13 cutoff for Women Infant Children benefits, Nov. 1 when enrollment opens for Obamacare, and Nov. 21, when Congress is slated to break for Thanksgiving amid the year’s busiest travel season.
However, the risk persists that the shutdown may carry on, according to Pimco analysts.
“Shutdowns are simple to implement, but challenging to reverse, and this instance – being the first complete shutdown since 2013 – appears particularly difficult, at least for the time being,” the firm indicated in a report.
