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The Shutdown Will End; the Question is “When?”

October 11, 2013

With the threat of the debt limit ceiling being hit on October 17 (next Thursday), there was finally some back-and-forth discussion between House Republicans and the White House late on Thursday. Some people are optimistic because they are talking, but at the moment they are no closer to a resolution of the current U.S. budget crisis. Further, the House offer was a 6-week extension on the debt ceiling without passing a continuing resolution that would re-open the government. Things may change quickly if they continue to talk and we can only hope they do.

The best case for FDA is that the government shutdown ends as part of a deal on the debt ceiling. However, the lack of progress and the Republican offer covering only the debt ceiling is discouraging. Even a very short extension of the debt ceiling/continuing resolution would put government employees back to work and open the possibility that a longer-term resolution can be negotiated during the brief extension. The worst case for FDA is that a debt ceiling deal becomes politically possible only if House Republicans retain negotiating leverage by continuing a government shutdown. This was discussed in last week’s Analysis and Commentary and is a possible rationale for the House offer during yesterday’s meeting with President Obama.

How did we get into this mess? Earlier this week, I tried to answer this question at a Drug Information Association/NORD conference on rare diseases and orphan products. Here are the slides from that presentation, but here are some key points:

  • Macro- and micro-budget concerns. The current impasse is all about the larger issues of total spending on government programs. It is not about FDA (and NIH), which continue to enjoy strong Congressional support.
  • Iron triangle of deficit reduction. Total government debt, as well as annual deficits, can only be addressed by spending, entitlements, or revenues. There are no other options. All discretionary spending (including FDA) will continue to be squeezed (via low budget ceilings and sequestration) until Congress and the President address entitlements and revenue.
  • Government shutdown. The current impasse has led to the furloughing of 6,600 FDA employees (45% of workforce) and 13,600 NIH employees (73% of workforce). If you exclude employees being paid for through carryover user fees, slightly less than 15% of the FDA would be working. If you exclude NIH clinical center functions, slightly less than 13% of the NIH would be working. Aside from user fees and the clinical center, very little is being done at either agency.

The shutdown will end, we just don’t know when. At that point, FDA will have a huge backlog of work to do, but everyone will sigh with relief. However, the Alliance has not lost sight of — and nor should you — that the continued underfunding of FDA has dire consequences. After the tears of the shutdown, that is still the main story.

Note: This analysis and commentary is written by Steven Grossman, the Deputy Executive Director of the Alliance for a Stronger FDA.

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