January 2, 1996 – Government Shutdowns – Recession Jitters
January 2, 1996 – First full working day of the new year and the Government was going into day 18 of a partial shutdown. Like clockwork, a budget impasse tossed government agencies and employees into the abyss of uncertainty as paychecks halted, offices shut down and household bills went unpaid. As of this day, the sides were so far apart, any chance of ending the shutdown anytime soon seemed remote.
Almost a ritual, but the threats of shutdowns, the actual shutdowns, and the eventual reconciliations were still episodes in nail-biting nonetheless, if you depended on the government for your livelihood. For everyone else, it was shrugged shoulders, skyward glances and sighs of exasperation. Brand new year, same old stalemate. And that’s how 1996 started for many.
There was other news – the business year was starting with rumors of recession as the 1996 elections loomed. Economists were issuing gloomy assessments of the economy for the months ahead. At best they believed, Business was moving at a slow, sluggish pace leading many to issue warnings of rocky sailing ahead with a 30% risk of a full-blown recession during the first part of the year.
AT&T said it was laying off some 30,000 supervisory employees as part of its plan to split into three separate companies. Another 10,500 positions would be cut via voluntary severance and divestitures, with the phase-out process beginning this month.
And The Tobacco companies were lining up in an effort to combat Federal rules on teen smoking, saying the FDA exceeded its authority on its plan to restrict access by minors to cigarettes and other tobacco products. The companies argued the FDAs’s proposal would violate U.S. law and even the Constitution. In opposition were the Attorneys General of 28 states, siding with the FDA.
And that’s just a small slice of what went on, this second day of January 1996, as reported by The CBS World News Roundup.