Snacks
Crisis

The Senate scrambles to avoid a gov’t shutdown, which could leave millions without pay

Snacks / Thursday, September 28, 2023
A House divided (Chip Somodevilla/Getty Images)
A House divided (Chip Somodevilla/Getty Images)

11th-hour theatrics… American leaders still can’t agree on how to spend Uncle Sam’s cash. The country is three days from a federal government shutdown. On Tuesday, the Senate reached a bipartisan spending agreement aiming to avoid a shutdown. The stopgap bill would keep the gov’t funded till November 17, and includes $6.2B in aid to Ukraine, plus $6B for natural-disaster relief. 

  • Don’t break out the Martinelli’s: The chamber still has to greenlight the bill before it can be sent to the House, where stark disagreements among Republicans cloud its chances of getting passed. 

  • Refresher: Federal shutdowns happen when Congress can’t agree to pass funding legislation signed by POTUS. The House and Senate need to pass 12 spending bills to fund federal agencies — or pass a temporary extension. 

The course of true law… never did run smooth. If Congress can’t agree by Sunday, thousands of federal workers and 1.3M active-duty military members could be left without paychecks. Some workers would be furloughed, while essential personnel like military, law enforcement, firefighters, and TSA would be required to work without pay. Agencies like the FDA and OSHA may have to limit operations, and thousands of kids could lose access to care programs.

  • All’s not lost: Most gov’t operations would be business as usual, since only about a quarter of federal spending is “discretionary” (the portion that requires annual approval by Congress). 

  • Safety net: Medicare, Medicaid, and Social Security payments wouldn’t be affected. Neither would the Postal Service, which runs on its own $$.

Disagreement breeds distrust… And the US gov’t has been far from united. This shutdown situation is giving folks flashbacks to the debt-ceiling crisis in May, which got resolved last minute. Because of that hot mess, the US got its first downgrade from a major credit-rating agency (Fitch) in more than a decade. This week, rating agency Moody's warned that a shutdown would hurt the US’s credit.

Get Your News

Subscribe and thrive

Snacks provides fresh takes on the financial news you need to start your day. Chartr provides data visualizations on business, entertainment, and society. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Latest Stories

Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate, including Robinhood Markets, Inc., Robinhood Financial LLC, Robinhood Securities, LLC, Robinhood Crypto, LLC, or Robinhood Money, LLC.