US government shuts down after Democrats refuse to back Republican funding plan
A US government shutdown has been triggered after a deadline to reach a funding agreement before the start of the new fiscal year, on 1 October, came and went without a deal.
Democrats and Republicans angrily blamed each other and refused to budge from their positions as the country hurtled towards the midnight ET deadline, unable to find agreement or even negotiate as hundreds of thousands of federal workers stood to be furloughed or laid off.
Senate Democratic leader Chuck Schumer said Republicans were trying to “bully” Democrats by refusing to negotiate on an extension of healthcare benefits and other priorities. Senate majority leader John Thune said Republicans were “not going to be held hostage” by the Democrats’ demands.
Hours before the shutdown, Donald Trump told reporters he had “no choice” but to lay off federal workers if no deal was reached. Asked about why he was considering mass layoffs, Trump said: “No country can afford to pay for illegal immigration, healthcare for everybody that comes into the country. And that’s what they [Democrats] are insisting. They want open borders. They want men playing in women’s sports. They want transgender for everybody. They never stop. They don’t learn. We won an election in the landslide. They just don’t learn. So we have no choice. I have to do that for the country.”
In a polarized Washington, with the chambers narrowly divided, shutdown threats have become a feature of recent congressional budget battles. A standoff in 2018, during Trump’s first term, resulted in a 34-day shutdown, the longest in the modern era. At the time, roughly 800,000 of the federal government’s 2.1 million employees were sidelined without pay.
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Senate Republicans have scheduled another round of votes on the two funding bills on Wednesday morning, with the stated goal of giving Democrats an opportunity to change their minds.
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The Democratic leaders Hakeem Jeffries and Chuck Schumer have blamed Donald Trump and Republicans for the shutdown, saying they “do not want to protect the healthcare of the American people”.
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The White House has responded to the shutdown threat by announcing plans to fire federal workers en masse if funding lapses. “When you shut it down, you have to do layoffs, so we’d be laying off a lot of people,” Donald Trump said earlier on Tuesday, adding: “They’re going to be Democrats.”
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Russ Vought, director of the White House office of management and budget, released a letter blaming “Democrats’ insane policy demands” for a shutdown. “It is unclear how long Democrats will maintain their untenable posture, making the duration of the shutdown difficult to predict,” Vought wrote in the letter, which was addressed to the heads of federal offices and agencies.
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Democratic leaders say they are not backing down, but signs have emerged of dissent within their ranks. Three members of the Democratic caucus voted for the Republican proposal on Tuesday evening – two more than when the bill was first considered earlier this month. “I cannot support a costly shutdown that would hurt Nevada families and hand even more power to this reckless administration,” said Democratic senator Catherine Cortez Masto.
We will bring you the latest news and reactions on the shutdown as we get them.
Key events
On the president’s schedule today is signing executive orders in the Oval Office today at 4.30pm ET. This will be closed to press but I’ll update you if anything changes.
Before that, White House press secretary Karoline Leavitt will hold a press briefing around 1pm ET where she will face loads of questions on today’s shutdown. I’ll bring you all the latest from that when it gets going later.
As the midnight deadline approached last night, the Senate again rejected a Republican plan to keep federal funding flowing and avert a government shutdown.
In a pair of back-to-back votes, each party mostly united to block the other’s stopgap funding proposal, all but ensuring a partial shutdown for the first time in nearly seven years. Both measures needed 60 votes to pass.
Republicans united against a plan offered by Democrats to fund the government through the end of October, that would have also reversed the Medicaid cuts enacted as part of Donald Trump’s tax and spending megabill this summer and extend healthcare subsidies that make health insurance premiums more affordable for low- and middle-income people who purchase health insurance through the Affordable Care Act (ACA).
Nearly all Democrats voted to reject a House-passed plan that would have kept federal spending mostly at current levels through 21 November, and bolstered security for the executive branch officials, the supreme court, judges and members of Congress in the wake of the assassination of rightwing activist Charlie Kirk.
Here’s how each US senator voted on the Republican plan.
In the stock markets, European stocks and gold prices rose, while Wall Street futures fell on Wednesday as the US government shut down after lawmakers failed to reach a funding deal.
The prospect of services in the United States being closed pushed gold to another record high over $3,895, reports AFP.
In Asia, Tokyo’s stock market sank, while Hong Kong and Shanghai were closed for holidays.
European markets were lifted by pharmaceutical shares after Pfizer was granted reprieve from President Donald Trump’s tariffs by agreeing to lower drug prices in the United States. Trump also announced plans to unveil a website to allow consumers to directly purchase some medications from manufacturers at discounted rates.
The dollar remained under pressure on concerns caused by the US government beginning to shut down Wednesday. Democrats and Republicans failed to break a budget impasse, with talks hinging on health care funding.
“Historically shutdowns have been bad for the US dollar, bad for US equities, and bad for bonds too,” said Emma Wall, chief investment strategist at Hargreaves Lansdown. “Should the shutdown remain unresolved it is likely to drive money outside of the US to markets with more certainty,” she added.
While most shutdowns end after a short period, investors were concerned it could prevent the release Friday of the key non-farm payrolls report – a crucial guide for the Fed on rate decisions.
“Shutdowns have delivered bouts of volatility, but the precedent has been that weakness tends to be short-lived,” noted Joshua Mahony, chief market analyst at Scope Markets.
Futures on all three main indexes in New York were in the red.
Former Russian president Dmitry Medvedev mocked US president Donald Trump, saying that the United States had not sent nuclear submarines to Russian shores as Trump had promised.
Trump on Tuesday cast Medvedev as “a stupid person” and said that he had moved a “submarine or two” to the coast of Russia. He said in August that he had ordered two nuclear submarines to be moved to the “appropriate regions” in response to threats from Medvedev.
“New episode of the thriller series,” Medvedev said on X in English. “Trump once again brought up the subs he allegedly ‘sent to the Russian shores’ insisting they are ‘very well hidden.”
“As the saying goes, it’s hard to find a black cat in a dark room – especially if it’s not there,” Medvedev said.
George Chidi
Naveed Shah, a veteran and activist who served as an enlisted public affairs specialist – an army journalist – uncharacteristically found himself searching for words to describe the address of the newly styled secretary of war to flag officers on Tuesday.
“A lot of the words that are coming to me aren’t fit to print,” said Shah, policy director for Common Defense, a veterans advocacy organization. “The people in that room who have served for 20, 30-plus years in uniform do not need Pete Hegseth to tell them about warrior ethos.”
Hegseth’s hour-long Ted talk-style address touching on physical fitness, the doctrine of lethality and the perils of DEI certainly drew more attention than a policy memo might have, and perhaps more than Donald Trump’s rambling, politically charged hour-long speech that followed.
But the attention came at the cost of respect, said Dana Pittard, a retired army general who commanded soldiers in Iraq and co-author of Hunting the Caliphate.
“I thought it was insulting,” Pittard said of the address, rejecting Hegseth’s assertion that senior officers of color – like himself – had benefitted from a non-existent quota system for promotions.
Online chatter in military groups ahead of the unprecedented, secrecy-shrouded meeting of 800 generals and admirals called to Marine Corps Base Quantico in Virginia had revolved around a demand for some loyalty oath to the administration, or public firings or a declaration of war. Some described it as karmic revenge for decades of mandatory hour-long safety briefings held by unit commanders before dismissing troops for the weekend. Many also wondered if the expensive challenge to security could have been an email.
“Certainly, addressing the troops could be useful or beneficial, but to call 800-plus generals and senior enlisted advisers from around the world into this room just before a government shutdown? It’s not just bad optics or strategy,” Shah said. “A bad cold could have threatened our entire chain of command.”
Ramon Antonio Vargas
Retired US supreme court justice Anthony Kennedy fears “democracy is not guaranteed to survive” as “partisanship is becoming much more prevalent and more bitter” in the legal opinions coming from his former institution, he tells NPR in an upcoming interview.
Strikingly, for the interview set to publish in October, NPR’s Nina Totenberg said she asked Kennedy whether he was still sure the supreme court’s major decisions would remain intact – as he told a small group of journalists that he was when he retired in 2018 during Donald Trump’s first presidency.
NPR reported that Kennedy “demurred”, seven years after that prediction – and three years after the federal abortion rights once granted by the Roe v Wade ruling were eliminated by a supreme court with a conservative supermajority anchored by three Trump appointments.
“We live in an era where reasoned, thoughtful, rational, respectful discourse has been replaced by antagonistic, confrontational conversation,” Kennedy, who was appointed to the supreme court during Ronald Reagan’s presidency, remarked.
“It seems to me the idea of partisanship is becoming much more prevalent and more bitter. And my concern is that the court in its own opinions … has to be asked to moderate and become much more respectful.”
Kennedy, who during three decades on the supreme court bench earned a reputation as a moderately conservative and authored the majority opinion legalizing same-sex marriage, ominously added: “Democracy is not guaranteed to survive.”
Those comments from Kennedy came as he prepared to release a new memoir titled Life, Law & Liberty on 14 October. His statements also arrived as the supreme court was scheduled to begin a nine-month term on 6 October – during which it may weigh in on a request to overturn the 5-4 Obergefell supreme court decision that legalized marriage for same-sex couples nationwide in 2015.
Under the shutdown, the education department will stop its investigations into schools and universities over alleged civil rights violations.
Since the mass layoffs in March, the office has operated under a significantly reduced footprint. The department’s civil rights branch lost about half of its staff. The cuts raised questions about whether the office would be able to shrink a backlog of complaints from students who allege they have experienced discrimination on the basis of race, sex or disability status, AP reports.
The department’s own data has shown a decline in resolving civil rights cases, while new complaints from families have increased. During the shutdown, work on the pending cases will stop.
Already diminished by cuts by the Trump administration, the US education department will see more of its work come to a halt due to the government shutdown.
The department says many of its core operations will continue in the shutdown kicking off Wednesday. Federal financial aid will keep flowing, and student loan payments will still be due.
But investigations into civil rights complaints will stop, and the department will not issue new federal grants, AP reports. About 87% of its workforce will be furloughed, according to a department contingency plan.
AP reports:
Since he took office, president Donald Trump has called for the dismantling of the education department, saying it has been overrun by liberal thinking. Agency leaders have been making plans to parcel out its operations to other departments, and in July the supreme court upheld mass layoffs that halved the department’s staff.
In a shutdown, the administration has suggested federal agencies could see more positions eliminated entirely. In past shutdowns, furloughed employees were brought back once Congress restored federal funding. This time, the White House’s Office of Management and Budget has threatened the mass firing of federal workers.
Appearing before the House Appropriations Committee in May, Education Secretary Linda McMahon suggested this year’s layoffs had made her department lean – even too lean in some cases. Some staffers were brought back, she said, after officials found that the cuts went too deep.
“You hope that you’re just cutting fat. Sometimes you cut a little muscle, and you realize it as you’re continuing your programs, and you can bring people back to do that,” McMahon said. The department had about 4,100 employees when Trump took office in January. It now has about 2,500.
Chris Stein
The US government shut down on Wednesday, after congressional Democrats refused to support a Republican plan to extend funding for federal departments unless they won a series of concessions centered on healthcare.
The GOP, which controls the Senate and the House of Representatives, repudiated their demands, setting off a legislative scramble that lasted into the hours before funding lapsed at midnight, when the Senate failed to advance both parties’ bills to keep funding going.
The shutdown is the first since a 35-day closure that began in December 2018 and extended into the new year, during Trump’s first term. It comes as Democrats look to regain their footing with voters, who re-elected Trump last year and relegated them to the minority in both chambers of Congress.
“Republicans are plunging America into a shutdown, rejecting bipartisan talks, pushing a partisan bill and risking America’s healthcare,” top Senate Democrat Chuck Schumer said on Tuesday evening, as it became clear a shutdown was inevitable.
Last month, House Republicans passed a bill that would fund the government through 21 November, but it requires the support of some Democrats to clear the 60-vote threshold for advancement in the Senate. It failed to gain that support in votes held late on Tuesday, while Republicans also blocked a Democratic proposal to continue funding through October while also making an array of policy changes.
“Far-left interest groups and far-left Democrat members wanted to show down with the president, and so Senate Democrats have sacrificed the American people to Democrats’ partisan interests,” Senate majority leader John Thune said.
Senate Republicans have scheduled another round of votes on the two funding bills on Wednesday morning, with the stated goal of giving Democrats an opportunity to change their minds.
The White House has responded to the shutdown threat by announcing plans to fire federal workers en masse if funding lapses. “When you shut it down, you have to do layoffs, so we’d be laying off a lot of people,” Donald Trump said earlier on Tuesday, adding: “They’re going to be Democrats.”
National Parks will largely remain partially open even as the federal government shuts down. A plan released late on Tuesday, hours before the shutdown was set to begin, outlined how swaths of land not able to be locked down – including open-air memorials, park roads, and trails – will remain accessible to the public.
The document also detailed that more than 9,200 employees will be furloughed, reducing staff by roughly 64%. Only workers deemed necessary to protect “life and property”, will remain on duty.
The former superintendent of Joshua Tree national park said in 2019 the park could take hundreds of years to recover from damage caused by visitors during the 2018-19 shutdown.
In 2013, an estimated 8 million recreation visits and $414 million were lost during the 16-day shutdown, according to the National Parks Conservation Association, citing National Park Service data. During the most recent shutdown in 2019, many parks remained open though no visitor services were provided. The Park Service lost $400,000 a day from missed entrance fee revenue, according to the association’s estimates. What’s more, park visitors would have typically spent $20 million on an average January day in nearby communities.
The Guardian’s video desk has compiled this video as Republicans and Democrats blame each other for the shutdown.
Workers who were furloughed during the 2018-19 shutdown shared their stories with the Guardian in 2019. One, Leisyka Parrott, a furloughed employee with the Bureau of Land Management said: “The thing is when you get back pay, all the fees that you incur by missing payments – you don’t get paid back for those. If you are late for a payment and have a $25 fee, the government doesn’t pay for that.”
“There’s all kinds of issues with raising families, just buying gasoline,” said Franco DiCroce, a US army corps of engineers employee speaking in his capacity as president of Local 98 of the International Federation of Professional and Technical Engineers told the Guardian. “Most of these people, their salaries are not skyrocketing. They’re suffering even more, because some of them live check-to-check, so if they don’t have money coming in, they’re going to have difficulty meeting their needs, to even buy groceries.”
Many turned to food banks in order to eat. “You’ve worked for 10, 20, 30 years for the government,” said Nurel Storey, an officer for the National Treasury Employees Union Chapter 22. “And all of a sudden things have just been shut off, for no fault of your own.”
The 35-day partial shutdown of the US government that started in 2018 cost about $11bn and shaved 0.2% off the nation’s annual economic growth forecasts, the non-partisan Congressional Budget Office said in January 2019.
According to the CBO, that shutdown hurt economic growth because it affected roughly 800,000 workers and delayed federal spending on goods and services.
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