The federal government's fiscal year began on October 1. This means that after September 30 the federal government can operate fully only if Congress has finalized the appropriation process that provides funds for the entire government. The government shutdown that started last week was caused because Congress did not wrap up the appropriations process on time - even though this date has been known since 1974 when Congress officially moved the fiscal year to begin every October 1.
Obviously something else is in play & that something is leverage that one party sees as an advantage over the other.
In this case the Republicans want to pass a Continuing Resolution (CR) that extends the previous year's spending levels - but only for seven weeks such time being used to negotiate the 12 appropriations bills needed to fully fund the government. Although they are in the minority in both Chambers of Congress & Trump is in the White House the Democrats know they have leverage over the issue.
I can't think of a shutdown that went well for the Republicans.
The last government shutdown occurred during Trump's first term & ran from December 22, 2018 until January 25, 2019 making it the longest one to date @ 35 days. It was caused because Congress & Trump could not agree on an appropriations bill to fund the government for the 2019 fiscal year (which had started almost three months before) or a temporary CR that would extend the deadline for passing a bill. The fight was over a $5.7 billion line item Trump wanted included to build portions of the border wall which Pelosi & Schumer would not budge on.
This shutdown ended with a three week CR to give Congress time to negotiate a suitable appropriations bill. Trump, after welcoming the shutdown in a meeting with Pelosi & Schumer saying "I am proud to shut down the government for border security, Chuck" & "I will take the mantle. I will be the one to shut it down. I'm not going to blame you" endorsed the plan amidst increasing security & safety concerns such as a significant number of absences of air traffic controllers. In short Trump blinked but had a workaround.
In February 2019 Trump declared a national emergency & diverted $3.6 billion from military construction projects as well as money earmarked for counter-drug programs & another $3.8 billion defunding projects like fighter jets & ships to fund the wall. The One Big Beautiful Bill Act (OBBBA) signed into law on July 4, 2025 includes $46.5 billion dollars that is available until September 30, 2029 for construction of hundreds of miles of border wall meaning not only did Mexico not pay for the wall but that Congress did not fund the wall during Trump's first term.
Note - On two occasions Biden & Congress missed funding deadlines. It was by hours in the first case on March 23, 2024 & 38 minutes in the second case in December, 2024. But in neither case did the government shut down.
Now this current shutdown standoff could be every bit as difficult to resolve as the 35 day shut down of 2018-2019 because both sides are just as intractable in their positions. And it's the same participants except for swapping Hakeem Jeffries for Pelosi.
Here's why.
Trump & Republicans in Congress needed to pass a tax & spending bill in 2025 because after December 31, 2025 the individual income tax rates in Trump's first tax bill, the Tax Cuts & Jobs Act (TCJA) of 2017, would expire resulting in the tax code reverting back to the law pre-TCJA which would mean a $4.5 trillion income tax increase in 2026 that Trump acknowledged would be a death knell for his presidency. The OBBBA passed under a special legislative process known as reconciliation which expedites legislation limited to the fiscal budget by the slim Republican margins of 218 to 214 in the House & 51 to 50 in the Senate with the Vice President needed to break the tie.
The reconciliation rules were added to the Senate rules in 1974 to expedite legislation on budget matters only, meaning the Senate filibuster rules that require 60 Senators to end debate in a process known as cloture does not come into play for budget matters. The filibuster has its roots going back to the very first Senate session of September 22, 1789 & came about due to an early decision by the Senate to allow unlimited debate, hence the Senate became known as the world's greatest deliberative body - but not on budget matters the last 51 years.
So the OBBBA was signed into law with no Democrat support after the Republican leadership miraculously held their slim majorities together that resulted from the 2024 election showing once again that elections have consequences. The OBBBA totaled 870 pages & included plenty of bafflegab but the biggest contention centered around 9 million able bodied people 19 to 64 years old who are eligible for Medicaid through the ObamaCare expansion losing coverage in 2027 for failure to meet very modest work requirements. Democrats vowed to make this a campaign issue in the 2026 midterms which is their right & for them probably a good strategy, although it is still over a year away.
But of a more immediate nature buried in the OBBBA is the elimination of temporary enhanced subsidies for ObamaCare that were passed by Democrats on March 11, 2021 as part of the American Rescue Plan Act (ARPA). The enhanced subsidies provided by the ARPA were originally set to expire @ the end of 2022. However, the Inflation Reduction Act (IRA) of 2022 extended them for an additional three years, through the end of 2025 or less than three months from now. These types of seemingly well meaning temporary provisions that turn into permanent government dependent programs are the type of consequences we get when Democrats win majorities in elections.
Democrats demand that the expiring subsidies be reinstated - that is their price that must be paid for reopening the government. In essence the Republicans put the expiration of the subsidies in the OBBBA in July & Democrats want to reinstate them in October. This is the basis of the intractable positions - something like asking what happens when the irresistible force meets the immovable object.
Keeping the federal government funded & open requires legislation that is subject to the Senate filibuster & cloture rules meaning that with the slim 53 to 47 majority that Republicans have they will need some Democrat support to reopen the government. Click here to see the October 3 vote that failed 54 to 44 with two not voting. Note the Vote Summary says Required For Majority: 3/5 Vote Result: Cloture on the Motion to Proceed Rejected.
It raises the question - is having leverage @ the start of the fiscal year better than winning elections? It certainly shows the fragility of the Republican majority & points out that there was no election mandate if Republicans can't pick up seven Democrat senator votes.
The Democrats' strategy is to portray Republicans as hard hearted politicians who want to increase healthcare premiums of poor people. About 24.3 million people are enrolled in ObamaCare with 92% (22.4 million) of them receiving the subsidies including people in households who make over 400% of the federal poverty level & have costs capped @ 8.5% of income. It is estimated that when the subsidies expire @ the end of the year that the average monthly premium will increase by 75% for people currently receiving the subsidies, which in turn could cause many people to drop ObamaCare. Trump & Republicans have wanted to replace ObamaCare since before 2017 but they have not said with what.
In summary, both parties have used the rules (reconciliation for Republicans & the filibuster & cloture for Democrats) to make the most of their positions, which is politics. In the shutdown standoff the public will be drawn in much more regarding the terms & conditions to reopen the government than they were in the writing of the OBBBA.
Republican pollsters John McLaughlin & Tony Fabrizio have advised Trump that there are many Republican voters, especially in Texas, Georgia, & Florida, who will get letters telling them of their upcoming premium increases that are in line with the OBBBA. These letters are starting to come out now.
How do you think this is going to turn out?
