The US federal government is poised for its first shutdown in nearly seven years after Senate Democrats blocked a Republican-backed short-term spending bill late Tuesday. With funding set to expire at midnight, over 800,000 federal workers face furloughs as partisan disputes over healthcare benefits paralyze negotiations.
Healthcare at Heart of Impasse
Democrats demanded expanded Affordable Care Act subsidies and restored coverage eligibility for legally present immigrants – including refugees – while Republicans sought temporary funding extensions. Senate Minority Leader Chuck Schumer accused Republicans of prioritizing 'lies over healthcare,' while former President Donald Trump claimed Democrats sought to 'shut down the government' over undocumented immigrants' benefits.
Economic Repercussions Loom
A shutdown would immediately halt non-essential services, from national parks to visa processing. Maya MacGuineas of the Committee for a Responsible Federal Budget warned shutdowns 'waste money' through idle workers and disrupted services. The 2018-2019 shutdown cost $3 billion – 0.02% of GDP – according to Congressional analysts.
Road to Resolution
Senate Republicans plan to revisit the House-passed spending measure later this week. However, the $1.7 trillion agency operations budget remains contentious, representing nearly a quarter of total federal spending. This marks the third near-shutdown since December 2024, reflecting deepening political divisions.
As midnight approaches, global markets and Asian investors closely monitor the stalemate, wary of ripple effects on trade and dollar stability. KhabarAsia will continue tracking developments impacting cross-Pacific economic ties.
