Shutdown: What an Oct. 1 Federal Freeze Would Mean

A federal shutdown is just days away, and Washington still hasn’t figured out how to keep the lights on past September 30. Republicans control Congress and the White House, but Senate rules mean they still need seven Democratic votes to move any funding bill. Chuck Schumer says his price is an extension of the enhanced Affordable Care Act premium subsidies and a few other items. GOP leaders want a seven-week stopgap with extra security money for the legislative, executive, and judicial branches. President Donald Trump doesn’t sound interested in splitting the difference — he canceled a meeting with Democratic leaders and called their demands “totally unreasonable.”

If the stalemate holds, this shutdown could feel different from the ones you remember. The White House budget office has hinted at a new playbook that pushes agencies to downsize programs that lose funding and don’t fit the president’s priorities. It’s also harder to see the full plan this time: instead of posting contingency plans in one place, OMB is leaving them on individual agency sites. What hasn’t changed is the clock. Without action, the government hits the wall at 12:01 a.m. on Wednesday, October 1.

A quick refresher: Congress has to fund most federal departments every fiscal year, which starts October 1. Lawmakers haven’t passed any of the 12 full-year spending bills, and there’s no short-term “continuing resolution” in place, so we’re looking at a full shutdown, not a partial one. Essential functions that protect life and property keep going — think law enforcement and border patrol — and Social Security and Medicare checks still go out. But plenty of everyday government work will stall. Past shutdowns delayed food inspections, canceled immigration hearings, and slowed federal lending to homebuyers and small businesses. Students have struggled to get IRS transcripts they need for financial aid, and the Agriculture Department has warned in previous episodes that SNAP benefits could only be guaranteed for a limited time. The IRS can cushion a few blows by leaning on Inflation Reduction Act funding to prep for tax season — updating forms and systems and hiring seasonal staff — but that only goes so far. Courts can function for a bit, judges keep getting paid, yet tight budgets mean many judicial employees could feel the pinch fast.

National parks are a wild card. In 2013, parks closed and an estimated eight million visits — and $414 million in spending — vanished during a 16-day shutdown. In 2019, many sites stayed open without services, bleeding about $400,000 a day in missed entrance fees while nearby towns lost roughly $20 million in visitor spending on a typical January day. States sometimes step in; Utah, Arizona, and Colorado have used state dollars to keep marquee parks open during past standoffs.

Air travel usually muddles through but not without stress. TSA officers and air traffic controllers are deemed essential, so they work without pay, which can lead to sickouts and slowdowns. In January 2019, a small wave of controller absences briefly shut down LaGuardia and delayed flights at other big hubs, helping force a deal to end the impasse.

Federal workers bear the brunt. In the most recent near-miss, more than 1.4 million employees were tagged “essential,” with roughly half paid from other sources and the rest working without paychecks. Nearly 900,000 would have been furloughed entirely. By law, federal employees receive back pay once a shutdown ends; contractors generally don’t. This time, judiciary officials are warning the effects could hit faster than usual because budgets are already tight.

Shutdowns aren’t just inside-the-Beltway drama; they dent the economy. The record five-week shutdown in 2018–2019 knocked $3 billion off growth that was never recovered, according to the Congressional Budget Office, and IRS enforcement slowdowns left tax receipts about $2 billion lower, much of it gone for good.

If there’s no deal by October 1, essential services continue, but expect closed doors, delays, and unpaid workers across a lot of government. Whether this is a blip or a long freeze depends on whether Democrats get their ACA subsidy extension, Republicans secure a short stopgap with security money, and the White House decides compromise is better than chaos.

Axios, CNN, and Bloomberg contributed to this report.