Government shutdown?

Den 1. oktober 2025 stengte den amerikanske føderale regjeringen ned etter at Kongressen ikke klarte å bli enige om en midlertidig finansieringslov. Republikanerne presset på for en budsjettforlengelse uten nye tiltak, mens Demokratene krevde at avtalen også skulle sikre videreføring av subsidier i Affordable Care Act og reversere kutt i Medicaid. Da ingen av forslagene oppnådde flertall i Senatet, løp bevilgningene ut – og USA gikk inn i sin første store nedstengning siden 2019.

Marie Fitchtner skrev om dette allerede i 2023, og siden det akkurat har blitt til virkelighet republiserer vi i dag artikkelen opprinnelig skrevet i oktober 2023. Forord og avslutning er skrevet av redaktør.

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Fears of a U.S. government shutdown have made headlines several times in the past year as Congress, which makes the final decision to avoid a shutdown by passing appropriations bills, has been under Republican control since the 2022 Midterms. Thus, Congress can block any bills necessary to stop the Democratic government from working. In early October 2023, Republicans even decided to get rid of their own House Speaker Kevin McCarthy, who was the third highest ranking political official in the United States. One of the reasons was that his party was unhappy with the agreement he had reached to avoid a government shutdown. Therefore, we should look at what a government shutdown is and what its economic significance is.

Each February, the President of the United States sends the House of Representatives and the Senate a draft budget for the following fiscal year, which begins on October 1. Their budget committees prepare their own draft budget on the basis of the President’s proposal. The House of Representatives and the Senate must then pass a formal budget resolution by April 15, setting the maximum budget amount. Afterwards the House and Senate Appropriations Committees submit appropriations bills to the full House and Senate for consideration. These bills specify how much money from the U.S. budget is allocated to federal agencies and in what amounts. Each of these bills must be passed by both chambers.

If Congress or the House of Representatives fail to pass some of these appropriations bills, the U.S. government will be partially shut down, and affected federal agencies will not be allowed to spend money or work. A complete government shutdown occurs when none of the 12 appropriations bills have been passed. In the short term, lawmakers can then pass a resolution with temporary funding bills to provide government agencies with money for a limited time. However, thwese often involve large spending cuts.

Joe Biden with graph of unions and shared prosperity in USA.

What are the consequences for U.S.citizens, the domestic economy and the political standing? Citizens will be affected primarily by delays in applying for passports, loans and other government benefits. In addition, national parks, for example, will be closed and fewer food inspections will be conducted. Government officials won’t receive payments throughout the shutdown and will therefore have to curtail spending, which particularly affects households where both employees work in federal agencies. Economic activity could weaken as various sectors and companies are delayed in receiving government subsidies and since federal employees would have to cut spending. Investment could be dampened as the government shutdown leads to uncertainty and increased volatility in financial markets, which affects the propensity to invest. In addition, increased repetition of temporary funding bills instead of a budget agreement could lead to a downgrade of the government’s credit rating - increasing borrowing costs for the government.

Regarding economic growth, production, and taxpayer costs, a closer look at some estimates shows that the 17-day shutdown in October 2013 resulted in a $2 billion loss of productivity among government workers and a 0.3 percentage point decline in GDP in Q4 2013. The month long partial government shutdown from December 2018 to January 2019 reduced real GDP by $11 billion in Q4 2018 and Q1 2019. In total, the last three government shutdowns cost taxpayers nearly $4 billion. In addition, it is important to remember that a government shutdown also means that key political positions, such as overseas diplomats, may have to stop working. In times of numerous wars around the world, this should be avoided to prevent current events from worsening. During the 2019 shutdown, 23 percent of U.S. diplomats overseas and 40 percent in the United States have been furloughed. In addition, the current interim agreement excludes financial assistance to Ukraine, as it was decided to cut spending in this field. It is also not conducive to stability in a rather politically divided country, and likewise does not improve political standing in the world, if a country cannot decide on an annual budget.

US Congress

Should we be afraid then?

Currently, the U.S. state budget is on a 45-day interim solution until mid November, as an agreement has still not been reached. By October 26, the House of Representatives was out of work after failing to agree on a new speaker for three weeks. Time is thus running out for the House and Congress to find a compromise on the budget, and this increases the likelihood of further disagreements that could lead to a continued loss of credibility. Overall, however, the impact of short government shutdowns on the global economy is likely to be small, while there may be slightly negative effects on the domestic economy. In contrast, the debt ceiling crisis in June 2023 would have had a significant economic impact as the U.S. faced a default that would have worsened the global economic outlook since the U.S. would no longer be solvent and a government shutdown would have been forced. As the debt ceiling crisis was resolved by suspending the debt ceiling until January 2025, the newly elected government, which is going to be elected on November 5, 2024, will have to find a quick agreement to prevent such an economic deterioration.

Etter nedstengingen 1. oktober 2025 står USA overfor en politisk fastlåst situasjon, der veien videre i stor grad vil bli bestemt av hvor raskt Kongressen klarer å forhandle frem et kompromiss. På kort sikt er det mest sannsynlige utfallet en midlertidig avtale som gjenåpner staten og gir en tidsavgrenset forlengelse av helsesubsidiene, slik at forsikringsmarkedet ikke rammes når åpen innmelding starter i november. Dersom partene likevel ikke klarer å møtes, kan USA gå inn i en langvarig nedstenging som vil gi økte økonomiske kostnader, markedsuro og sterk folkelig misnøye.

På mellomlang sikt vil ikke konflikten forsvinne, men snarere prege hele budsjettåret. Selv etter en midlertidig løsning vil neste frist igjen kunne utløse konfrontasjoner. Helsepolitikk – særlig finansieringen av ACA og Medicaid – vil stå sentralt i amerikansk innenrikspolitikk frem mot presidentvalget i 2026.Nedstengingen illustrerer økt polarisering i amerikansk politikk, og hvordan budsjettprosessen i økende grad brukes som politisk pressmiddel. Veien videre blir derfor ikke bare et spørsmål om å gjenåpne staten, men også et forvarsel om nye og gjentatte budsjettkamper i årene fremover. Spesielt når MAGA-bevegelsen og Demokratene har vidt forskjellig syn på hvor veien bør lede videre for den amerikanske ørnen.