The US stands just days from a full government shutdown amid political deadlock over demands from rightwing congressional Republicans for deep public spending cuts.
Fuelled by bitter ideological divisions among the Republican majority in the House of Representatives, funding for federal agencies will run out at midnight on 30 September unless – against widespread expectation – Congress votes to pass 12 appropriations bills to finance government operations in time for the start of the new financial year the following day.
It is an event with the potential to inflict disruption to a range of public services, cause delays in salaries, and wreak significant damage on the national economy if it becomes prolonged.
At the heart of the looming upheaval is the uncertain status of the Republican House speaker, Kevin McCarthy, who is under fire from members of his own party for agreeing spending limits with Joe Biden, that members of the GOP’s far-right “Freedom Caucus” say are too generous and want to urgently prune.
What happens when a US government shutdown takes place?
Thousands of federal government employees are put on furlough, meaning that they are told not to report for work and go unpaid for the period of the shutdown, although their salaries are paid retroactively when it ends.
Other government workers who perform what are judged essential services, such as air traffic controllers and law enforcement officials, continue to work but do not get paid until Congress acts to end the shutdown.
Depending on how long it lasts, national parks can either shut entirely or open without certain vital services such as public toilets or attendants. Passport processing can stop, as can research – at national health institutes.
The Biden administration has warned that federal inspections ensuring food safety and prevention of the release of dangerous materials into drinking water could stop for the duration of the shutdown.
About 10,000 children aged three and four may also lose access to Head Start, a federally funded program to promote school readiness among toddlers, especially among low-income families.
What causes a shutdown?
Simply put, the terms of a piece of legislation known as the Anti-Deficiency Act, first passed in 1884, prohibits federal agencies from spending or obligating funds without an act of appropriation – or some alternative form of approval – from Congress.
If Congress fails to enact the 12 annual appropriations bills needed to fund the US government’s activities and associated bureaucracy, all non-essential work must cease until it does. If Congress enacts some of the bills but not others, the agencies affected by the bills not enacted are forced to cease normal functioning; this is known as a partial government shutdown.
How unusual are US government shutdowns?
For the first 200 years of the US’s existence, they did not happen at all. In recent decades, they have become an increasingly regular part of the political landscape, as Washington politics has become more polarised and brinkmanship a commonplace political tool. There have been 20 federal funding gaps since 1976, when the US first shifted the start of its fiscal year to 1 October.
Three shutdowns in particular have entered US political lore:
A 21-day partial closure in 1995 over a dispute about spending cuts between President Bill Clinton and the Republican speaker, Newt Gingrich, that is widely seen as setting the tone for later partisan congressional struggles.
In 2013, when the government was partially closed for 16 days after another Republican-led Congress tried to use budget negotiations to defund Barack Obama’s signature Affordable Care Act, widely known as Obamacare.
A 34-day shutdown, the longest on record, lasting from December 2018 until January 2019, when Donald Trump refused to sign any appropriations bill that did not include $5.7bn funding for a border wall along the US border with Mexico. The closure damaged Trump’s poll ratings.
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What is triggering the latest imminent shutdown?
In large part, the crisis is being driven by the relatively weak position of McCarthy, the Republican speaker in the House of Representatives. Working with a wafer-thin majority in the 435-seat chamber, McCarthy needed a record 15 ballots to ascend to his position last January, a position earned only after tense negotiations with a minority of far-right Republicans.
Those same rightwingers are now in effect holding McCarthy hostage by refusing to vote for the appropriations bills on the basis of spending guidelines the speaker previously agreed with Biden. McCarthy could, theoretically, still pass the bills with the support of Democrats across the aisle. But rightwingers, notably the Florida congressman Matt Gaetz, have vowed to topple him as speaker in such a scenario.
Is there a way out of the current impasse?
Potentially, yes. McCarthy and other Republican leaders have been exploring the possibility of deploying a stopgap spending measure called a continuing resolution (CR) that would keep the government open until 31 October, while efforts continue to agree to final spending bills for 2024.
However, even that has failed to win approval of Freedom Caucus members, who are refusing to vote for it unless it has more radical conservative policies attached, such as language to address “woke policies” and “weaponization of the Department of Justice”. A list of amendments from the rightwing Georgia congresswoman Marjorie Taylor Greene includes a resolution preventing funds being used to aid Ukraine and a ban on funding for Covid-19 vaccine mandates.
How could a shutdown affect the wider economy?
According to the congressional budget office, the 2018-19 shutdown imposed a short-term cost of $11bn on the US economy, an estimated $3bn of which was never recovered after the stoppage ended.
Economists have warned the effects now could be compounded by other unrelated events, including the lingering impact of inflationary pressures and the United Auto Workers strike against America’s three biggest car manufacturers, which union leaders have threatened to expand if their demands remain unmet.
How has Joe Biden reacted?
The president has tried to use the bully pulpit to put the spotlight on the GOP holdouts, emphasizing that they should be blamed if a shutdown does go ahead.
“Let’s be clear. If the government shuts down that means members of the US military are going to have to continue to work but not get paid,” Biden said at a dinner hosted by the Congressional Black Caucus Foundation at the weekend. “Funding the government is one of the most basic responsibilities of Congress. It’s time for Republicans to start doing the job America elected them to do.”
Fearing the worst, however, the White House has published a set of blueprints for how government agencies should operate if a shutdown ensues and funds run out.
