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U.S. Begins Shutdown That May Lead to Mass Layoffs and Cuts to Services

October 1, 2025
in News
U.S. Begins Shutdown That May Lead to Mass Layoffs and Cuts to Services
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The government shut down on Wednesday morning at 12:01 a.m., amid a bitter spending deadlock between President Trump and Democrats in Congress that will disrupt federal services and leave many federal workers furloughed.

It was the first federal shutdown since 2019, when parts of the government were shuttered for 35 days in a standoff between congressional Democrats and Mr. Trump over the president’s demand to fund a wall at the southern border.

This time, the dispute is over Democrats’ demand that the president agree to extend expiring health care subsidies and restore Medicaid cuts enacted over the summer as part of Mr. Trump’s marquee tax cut and domestic policy law.

The shutdown became all but inevitable on Tuesday night after Senate Democrats voted just hours before a midnight deadline to block Republicans’ plan to keep federal funding flowing.

In back-to-back Senate votes that reflected how acrimonious the funding dispute has become, each party blocked the other’s stopgap spending proposal, just as they had earlier in the month.

On a 55-to-45 vote, the G.O.P. plan, which would extend funding through Nov. 21, fell short of the 60 needed for passage. Republicans also blocked Democrats’ plan, which would extend funding through the end of October and add more than $1 trillion in health care spending, in a 47-to-53 vote.

Shortly afterward, Russell T. Vought, the White House budget director, directed agencies in a memo to “execute their plans for an orderly shutdown.”

Senate Republican leaders held the votes as a part of what they promised would be a daily effort to force Democrats to go on the record against extending government funding.

“The Democrats’ far-left base and far-left senators have demanded a showdown with the president,” said Senator John Thune, Republican of South Dakota and the majority leader. “And the Democrat leaders have bowed to their demands. And apparently, the American people just have to suffer the consequences.”

Democrats said they were resolute in their determination to continue the standoff until Republicans relented to their demands, which include the extension of Obamacare subsidies that are set to expire at the end of the year, as well as the reversal of cuts to Medicaid and other health programs that Republicans included in the tax cut legislation.

“If the president were smart, he’d move heaven and earth to fix this health care crisis right away, because Americans are going to hold him responsible when they start paying $400, $500, $600 a month more on their health insurance,” said Senator Chuck Schumer, Democrat of New York and the minority leader. “We have less than a day. If there was ever a moment for Donald Trump and Republicans to get serious about health care, it is now.”

But instead of any negotiation, lawmakers in both parties spent the hours before the spending deadline pointing fingers at one another for the coming crisis, and Mr. Trump issued threats from the White House, appearing to relish the prospect of a shutdown that he said he would use to hurt his political opponents.

The president said he would move during a shutdown to enact measures that are “bad” for Democrats “and irreversible by them, like cutting vast numbers of people out, cutting things that they like, cutting programs that they like.” Later in the Oval Office, he said that “a lot of good can come down from shutdowns,” including laying off federal workers who are Democrats and undermining initiatives they support.

In a shutdown, Mr. Trump said, “we can get rid of a lot of things that we didn’t want, and they’d be Democrat things.”

Democrats appeared unbowed by the threats. In March, a clutch of Senate Democrats led by Mr. Schumer allowed a stopgap spending bill to advance, prompting an outpouring of ire from liberal voters and activists who had urged their leaders to deny their votes in protest of Mr. Trump’s administration.

This time, Democrats have picked a fight with Mr. Trump on money for health care — an issue on which polls show Democrats have the upper hand — and dared the president and Republicans to say no.

“The strategy is — the American people are demanding it,” Mr. Schumer said.

Still, a few members of the Democratic caucus broke from the party on Tuesday evening in the hours before the spending deadline and voted for Republicans’ spending plan. Senators Catherine Cortez Masto of Nevada, John Fetterman of Pennsylvania and Angus King, independent of Maine, all supported the measure.

Senator Rand Paul of Kentucky was the sole Republican to vote against his own party’s funding bill.

If the Obamacare tax credits are allowed to lapse, about four million people are projected to lose coverage starting next year, and prices will go up for an additional 20 million people. The Congressional Budget Office has projected that 10 million more Americans would become uninsured by 2034 as a result of the health cuts in the new tax law.

Mr. Thune has said he would be willing to negotiate separately on extending the tax credits. Many of his senators who are up for re-election next year have endorsed the move. But Democrats are taking government funding “hostage,” Mr. Thune said.

“The negotiation happens when the government is open,” he said.

Separately, Democrats have said they cannot continue to fund an administration that routinely tramples Congress’s power of the purse.

“That’s just another excuse,” Senator Ben Ray Luján, Democrat of New Mexico, said of Mr. Trump’s threat to lay off federal workers during a shutdown. “They’re doing this time and time again. They’re going to do what they want to do.”

The chasm between the two parties was on stark display on Monday night after Mr. Trump met with congressional leaders at the White House. Mr. Trump posted a crude, A.I.-generated video insulting and mocking Democratic leaders that superimposed a cartoon mustache and sombrero over Representative Hakeem Jeffries of New York, the Democratic leader, who was pictured standing silently while Mariachi music played. The voice of Mr. Schumer was distorted to deliver expletive-laden remarks that included the line “Nobody likes Democrats anymore.”

Mr. Jeffries responded on Monday night by posting a photograph of Mr. Trump smiling alongside Jeffrey Epstein, the disgraced financier who died in prison in 2019 while awaiting trial on sex trafficking charges.

“This is real,” the post said.

In a separate post, Mr. Jeffries wrote, “Bigotry will get you nowhere.”

Mr. Trump and other Republicans continued to hammer at the misleading accusation that Democrats were shutting down the government in order to give health care to unauthorized immigrants.

Mr. Trump’s fake video falsely quoted Mr. Schumer as saying that Democrats “have no voters left” because of the party’s positions on social policies and that he wanted to give “illegal aliens” free health care. The fabricated voice added that shutting down the government was a way to get undocumented immigrants to vote for Democrats, a claim that embraces a debunked conspiracy theory about noncitizens voting.

Michael Gold, Megan Mineiro, and Robert Jimison contributed reporting.

Catie Edmondson covers Congress for The Times.

The post U.S. Begins Shutdown That May Lead to Mass Layoffs and Cuts to Services appeared first on New York Times.

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