Two self-imposed deadlines are approaching fast. One comes on Friday, while the highest-level talks yet to meet the second get underway in the week ahead.
The first deadline is to get a portion of the federal government funded through September. Another government shutdown looms if President Donald Trump and the Democratic Congressional leaders can’t agree on border security. If not, it will mark the fourth time in two years pieces of the federal government can’t operate and hundreds of thousands of families could see their pay interrupted or skipped altogether.
The last partial shutdown cost the economy $18 billion, according to estimates from the Congressional Budget Office. That’s not an enormous cost to the American economy, but it is to those households missing paychecks.
The stock market has become inured to this kind of political dysfunction. The S&P 500 rallied 13 percent during the last partial shutdown. That’s no guarantee another shutdown will be greeted the same way, though.
Across the global in Beijing, the U.S. and China will have their most senior-level trade talks yet ahead of Trump’s March 2 deadline to strike a deal or hike tariffs on all kinds of Chinese-made goods. If that should happen, China likely would quickly follow suit. Treasury Secretary Steve Mnuchin and U.S. Trade Representative Robert Lighthizer lead the American delegation.
Since the first American import taxes were slapped on most foreign made solar panels and washing machines the S&P 500 is flat. Both the U.S. and China have levied tariffs on billions of dollars of items such as Chinese-made circuit boards to four-wheel drive American cars in the year since the trade battles began.
Investors aren’t solely focused on these deadlines, but missing them without real hope of resolution further erodes confidence and trust necessary to lead the economy.
Tom Hudson hosts “The Sunshine Economy” on WLRN-FM, where he is the vice president of news. Twitter: @HudsonsView.