Final answer:
A U.S. government shutdown may temporarily increase national savings by reducing short-term government expenditure, but can also decrease overall economic productivity and thereby lower savings. The effect on the government budget deficit is uncertain, as initial spending reductions are potentially offset by subsequent increased spending and higher borrowing costs.
Step-by-step explanation:
A government shutdown in the United States can have various implications for the national investment and savings identity, as well as the government budget deficit. During a shutdown, nonessential government services halt and many government employees are furloughed, which decreases government spending in the short term. This factor could lead to a temporary increase in national savings since government spending is a component of national savings calculations. However, the reduction in government services may also decrease overall economic productivity, which can lead to lower national savings.
In terms of the government budget deficit, a shutdown may temporarily decrease deficit spending since some governmental activities that require funding would temporarily cease. However, after the shutdown, there may be a need for increased spending to restart services and make up for the time lost, which could potentially increase the government budget deficit in the long run. Furthermore, during a shutdown, confidence in the government's fiscal management might wane, possibly increasing borrowing costs which can also affect the deficit. Therefore, the impact on the government budget deficit due to a shutdown can be uncertain and multifaceted.