KEY POINTS:
- The U.S. government officially shut down at midnight after Congress and the White House failed to reach an agreement on how to extend federal funding
- It’s the first government shutdown since 2018, in Trump’s first term, which was the longest ever at 34 days
- A PBS News/NPR/Marist poll found that 38% would blame Republicans, 27% would blame Democrats, and 31% believe both parties would be equally to blame
- The enhanced ACA subsidies have enabled many lower-income Americans to obtain coverage with no or very low monthly premiums
- About 750,000 employees will be furloughed each day, the Congressional Budget Office said
Shutdown Takes Effect as Congress Fails to Bridge Divide
The U.S. government officially shut down at midnight after Congress and the White House failed to reach an agreement on how to extend federal funding, marking the first major crisis of President Trump’s second term. President Donald Trump’s Republican Party controls both chambers of Congress, but it needs Democratic support to pass a bill in the Senate, where 60 votes are required.
The two parties failed to craft a bipartisan bill, with the Senate rejecting both a GOP proposal and a Democratic proposal just hours before the shutdown deadline. Vice President JD Vance said after a White House meeting on Monday: “I think we’re headed to a shutdown”.
Health Care Subsidies at Heart of Standoff
The core dispute centers on health care funding, specifically the future of enhanced Affordable Care Act subsidies. The tax credits lower the cost of health-insurance premiums paid by individuals and families who buy health plans on Obamacare exchanges, and expand the pool of eligible recipients. The credits are due to expire at the end of 2025.
Democrats are insisting that any short-term resolution to keep the federal government open at least another seven weeks include an extension of the subsidies. If the credits disappear at the end of this year, the cost of health insurance could soar on average by more than 75%, according to KFF, a nonpartisan health policy research group.
NBC News reported that extending the subsidies for a decade would cost an estimated $350 billion, according to the nonpartisan Congressional Budget Office.
Immigration Claims Fuel Partisan Rhetoric
President Donald Trump and other GOP leaders are accusing Democrats of demanding free health care for “illegal aliens” in return for their support of a federal funding bill. “They want to have illegal aliens come into our country and get massive healthcare at the cost to everybody else, and we don’t have it,” Trump told reporters on Tuesday.
However, Trump and Vance’s assertions are not true. The Democrats are drawing a line in the sand over health care, but it doesn’t involve undocumented immigrants. CNN reported that undocumented immigrants have never been eligible for Obamacare subsidies.
House Minority Leader Hakeem Jeffries, D-N.Y., during a “Squawk Box” interview, said, “Federal law prohibits the use of taxpayer dollars to provide medical coverage to undocumented individuals”.
Immediate Impacts on Federal Services and Workers
About 750,000 employees will be furloughed each day, the Congressional Budget Office said, while others who work essential jobs, like Transportation Security Administration agents, air traffic controllers, federal law enforcement officers and members of the military, will be forced to work without pay.
Federal employees will go without pay for the duration of a shutdown, while members of Congress and Trump will still receive their salaries. Under federal law, they are all scheduled to receive back pay once the government reopens.
Rep. Shontel Brown reported that the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) will quickly run out of funding and be unable to provide food for children and parents in need.
National parks will remain partially open during the shutdown. Medicare and Social Security benefits are unchanged, as they aren’t subject to the annual funding process.
Threats of Permanent Layoffs Escalate Tensions
Russell Vought, the head of the Office of Management and Budget (OMB), issued a memo on Tuesday evening directing government agencies to begin executing their plans “for an orderly shutdown”. The OMB director blamed the impending shutdown on “Democrats’ insane policy demands, which include $1 trillion in new spending”.
TIME reported that President Donald Trump threatened Democrats that he might exploit a shutdown to make “irreversible” cuts to health care and social benefit programs. “We can do things during the shutdown that are irreversible, that are bad for them and irreversible,” Trump said.
NPR reported that the White House said it will look for ways to use the funding dispute to permanently eliminate some federal workers, rather than just temporarily send them home on unpaid leave.
Political Blame Game Intensifies
In a new PBS News/NPR/Marist poll, a plurality – 38% – of U.S. adults say Republicans would be mostly to blame for a government shutdown. Another 27% would blame Democrats, while 31% believe both parties would be equally to blame.
A New York Times survey released Tuesday found that 26% would blame Trump and the GOP, while 19% would blame Democrats, 33% said they’d blame both equally, and 21% more were undecided.
CBS News reported that former Vice President and Democratic presidential nominee Kamala Harris pinned the blame directly on the GOP, saying, “President Trump and Congressional Republicans just shut down the government because they refused to stop your health care costs from rising”.
Senate Majority Leader John Thune, R-S.D., suggested that more Democrats could support the GOP bill once the pain of a shutdown begins. “The cracks in the Democrats are already showing,” Thune told reporters.
Failed Negotiations and Partisan Tensions
The shutdown came after a White House meeting Monday between Trump and leaders of both parties, the first time Trump had discussed the issue with the minority leaders, Schumer and Rep. Hakeem Jeffries, D-N.Y.. The meeting yielded no breakthroughs and even led to a new round of partisan sniping, which Trump initiated hours later by posting an insulting artificial intelligence-generated video of the two Democrats.
NBC News reported that Jeffries called Trump a coward, saying “Mr. President, the next time you have something to say about me, don’t cop out through a racist and fake AI video. When I’m back in the Oval Office, say it to my face”.
CBS News reported that House Speaker Mike Johnson suggested to reporters that no late-night negotiations are taking place, saying “There’s nothing to negotiate. There’s nothing I can give”.
Republican Position on “Clean” Funding Bill
GOP leaders declined to haggle over a short-term bill to prevent a shutdown temporarily, offering a proposal that would keep the government open at current spending levels until Nov. 21. They said they’ll negotiate spending policy only through the regular federal funding process.
Senate Majority Leader John Thune accused Democrats of “hostage-taking” and “hijacking” the appropriations process. Thune has said he won’t negotiate policy with Democrats while they take the government “hostage”.
Democratic Unity and Healthcare Demands
Democratic leaders said that’s not enough, vowing to oppose any bill that failed to include their priorities. NBC News reported that the Democrats’ top priority is extending the enhanced federal subsidies for Affordable Care Act coverage.
Three members of the Senate Democratic Caucus voted for the Republican bill Tuesday night: John Fetterman, D-Pa., Angus King, I-Maine, and Catherine Cortez Masto, D-Nev. That means they’ll need at least five more Democrats to pass it.
CBS News reported that House Minority Leader Hakeem Jeffries said on CNN that Democrats want to strike a deal with Republicans to fund the government, but “Republicans have adopted a my-way-or-the-highway approach”.
Economic and Political Implications
CNBC reported that the shutdown could cost the U.S. travel industry $1 billion per week, according to estimates from the U.S. Travel Association. Compensation for furloughed workers will cost taxpayers $400 million, according to the CBO.
PBS News reported that because independents are more likely to blame both parties, “this is not going to be as easy for Democrats to pin it solely on Trump and congressional Republicans,” said Amy Walter, editor-in-chief of The Cook Political Report.
Looking Ahead
It is unclear when the government will reopen. Republicans feel compelled to defend Trump’s policies that the opposition party is seeking to undo, like his Medicaid cuts. And Democrats face pressure from their base to take a more aggressive posture against second-term Trump.
Sen. Lindsey Graham, R-S.C., said Tuesday that he expected the shutdown to last until at least next week. “I don’t think anything’s going to happen until the House gets back,” he said.
