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Comptroller Warns of Shutdown Consequences for New York

Tuesday, October 01, 2013

New York's comptroller is warning that a prolonged government shutdown could depress the state's already struggling economy.

The partial federal government shutdown is affecting about 116,000 federal workers in New York who are furloughed because of the shutdown. But State Comptroller Tom DiNapoli said a prolonged crisis could hurt New York's fragile economic recovery as well. He said if Congress fails to agree on raising the federal debt ceiling later this month, then the stock market and the bond markets could suffer, which could negatively impact the state's pension fund and private retirement accounts.

"If the federal government is viewed as a dead beat, that's going to have reverberations throughout the rest of government finance," DiNapoli said. "That's a troubling specter that's hanging out there."

DiNapoli said if the shutdown continues until later in the year, federal funding for expensive programs like Medicaid could be jeopardized.

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