US Government Faces Potential Shutdown as Spending Deadline Nears

The U.S. administration and Congress are approaching a possible federal government shutdown, which would occur if the House of Representatives and the Senate do not reach an agreement on spending by 12:01 a.m. Wednesday, October 1.

Historical Context

The last shutdown began on December 22, 2018, and lasted until January 25, 2019 – 35 days, making it the longest in more than four decades. According to estimates by the Congressional Budget Office (CBO), it led to losses of about $3 billion in the U.S. gross domestic product.

During the funding lapse, government agencies were forced to suspend normal operations until Congress approved new funding.

Polarization and Risks

Although government shutdowns have been rare in recent decades – six such episodes since 1990 – the current split in Washington complicates reaching long-term consensus on spending.

Given that House Speaker Mike Johnson holds one of the narrowest majorities in modern history, and the Republican Party does not have 60 votes to overcome a filibuster in the Senate, the path to avoiding a shutdown remains unclear.

Analysts note that the trend is influenced by the fact that some government services may pause while others continue to operate even during a potential shutdown.

The 2018 Experience: Partial Shutdown

In 2018, the shutdown was partial: Congress approved funding for some agencies, allowing them to continue operating, while other federal departments were left unfunded. About 800,000 workers were affected; roughly 300,000 of them were furloughed, while the rest continued to work unpaid until funding was restored.

After funding was restored, workers received pay for the missed days. Meanwhile, the current Congress has not passed any of the 12 funding bills, underscoring the risks of a repeat shutdown if a deal is not reached by the deadline.

– Tami Lubi from CNN contributed to this report.

What’s Next and the Bottom Line

As the deadline approaches, it’s important to understand that any delay in funding could affect the operation of a range of government services, cause technical stoppages in various agencies, and have economic consequences for citizens. In a polarized political climate, both chambers must seek common ground on spending, priorities, and protecting critically important services to avoid a prolonged government shutdown.