Key Points
- Consumer confidence has dropped to a three-year low, largely due to the government shutdown.
- The FAA has ordered airlines to cut domestic flights, leading to hundreds of cancellations.
- The future of food stamps benefits is uncertain after the Supreme Court temporarily blocked a court order.
- Congressional leaders are under increasing pressure to end the shutdown, but a deal has not yet been reached.
Consumer confidence fell to a three-year low on Friday, partly due to worries about the ongoing government shutdown. A Trump adviser admitted that the economic effects were “far worse than we expected” as the shutdown’s impact spread across the U.S. economy.
Travelers are already feeling the pain, with U.S. airlines canceling hundreds of flights. This comes after a Federal Aviation Administration (FAA) order to cut domestic operations went into effect Friday morning.
The 4% cut became mandatory at 40 busy airports, and major airlines like United, Delta, and American had already announced flight changes for Thursday. The FAA’s cuts will get deeper, reaching 10% if the shutdown continues.
Meanwhile, a federal judge in Rhode Island ordered the Trump administration to immediately pay for food stamp benefits for tens of millions of Americans. However, the administration appealed, and the Supreme Court temporarily blocked the order late Friday. This created more uncertainty for the approximately 1 in 8 Americans who rely on the program, after the administration had previously said it would only pay partial benefits.
On Capitol Hill, the growing economic problems have put more pressure on congressional leaders to find a solution. Friday was filled with proposals and counterproposals, but a breakthrough remained out of reach. Still, there were some signs of optimism. Ed Mills of Raymond James said, “We believe we are at the beginning of the end, but are unlikely to see a resolution pass into law before next week.”
President Trump blamed the shutdown for Republican losses in Tuesday’s elections. Democrats, on the other hand, celebrated their wins and suggested that their strong stance on the shutdown, especially their focus on healthcare, was resonating with voters.
