The government shutdown could affect parts of the U.S. economy and the decisions Americans make on taxes and other financial matters. CBS News' Jill Schlesinger has more.

Washington

The ongoing US government shutdown is affecting hundreds of thousands of federal workers, many of whom are going without pay. The IRS plans to furlough over 34,000 employees, leading to the closure of taxpayer call centers and disruptions for those needing assistance with tax matters. Despite the shutdown, individuals are still required to make tax payments and adhere to installment plans.

Key economic data, such as the Consumer Price Index and jobs reports, are also being delayed, which may hinder the Federal Reserve's ability to make informed decisions on interest rates. The lack of timely information could lead to postponed meetings and uncertainty regarding inflation adjustments and Social Security cost-of-living changes.

How the government shutdown impacts the U.S. economy

Shutdown is affecting hundreds of thousands of federal workers who are going without pay. And the IRS says it plans to furlough more than 34,000 employees, effectively shuttering taxpayer call centers. And more jobs are set to get slashed as pressure builds to reopen the government. So let's bring in CBS News business analyst and my friend Jill Schlesinger to talk about this. So, Jill, this is kind of crazy. I mean, let's first talk about the IRS and these major cuts that are happening where we might see people not being able to prepare their finances. I know you're a big purveyor of online, like go online. Yeah. OK. But I mean, it is a problem when you have people who are not familiar with the IRS system. They haven't set up their security yet. So it is a problem. A couple of things about the IRS. Number one, they do expect you to keep paying. So anybody who's making a payment that's due October 15th, we have some people who are on extension. Remember those extensions from six months ago? You better submit. Number two, if you're on some sort of installment plan, you owe the IRS money and you've set up a plan. You got to keep paying. And number three, something that people don't realize, next week, when we should have been getting a CPI, Consumer Price Index report, that is the report that is usually the one that is used to figure out what inflation adjustments occur for next year, for your income tax brackets, also for your Social Security cost of living adjustments. That's on ice right now. So it's all well and good to say we're cutting people, but it leaves hundreds of millions of people here in the U.S. without information, not the least of which, of course, is like trying to plan for the end of the year, trying to understand what those income tax brackets are for next year. It's really bad. Yeah. But the point, of course, that you're making is that people should keep to their schedules and keep paying because no matter what happens with the government shutdown, they're expected to continue to make those payments. The other thing is, so how does this, so the Fed's supposed to meet to talk about interest rates. How does that happen when a government is shut down? Yes. I don't know whether they're going to say, OK, we have enough private data, because there's alternative measures all over the place, right? We have it from big companies. We have it from providers like ADP that does that monthly private payroll report. There are other measures of inflation that we could look at. But, you know, when you think about the Fed, they like the government data. And I think that there is a possibility, depending on how long the shutdown lasts, that the Fed says we're supposed to meet October 28th, 29th, maybe we'll push it off a week. Because we have to have the information. And I know we've already missed one jobs report. Next week is called the reference week. That is the week that the Bureau of Labor Statistics would normally go to gather the next employment report. So if we're shut down next week, then we don't have another report. We're done. And so that means we've missed two Labor Department reports. And I think without those reports, without inflation data, it does put the Federal Reserve on their back feet. Maybe they'll have an early Halloween. Maybe they'll just eat those Rolos and chill. I don't know. Or Maltesers. Yeah, could be. I love Maltesers. Yeah, that would be good. Jill, always good to see you. Here in Studio 55. I'm happy to be here. Come back more often. Yeah, it's great.

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Tel Aviv-Yafo

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Kyiv

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Pyongyang

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Los Angeles International Airport

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Cairo

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Los Angeles

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Mexico City

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Chicago

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Riyadh

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Santa Clara

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Breakdown