Many federal government agencies rely on annual funding appropriations passed by Congress and signed by the President. If those bills are not enacted on time and the agency’s current budget expires, that agency will experience a “shutdown.” Shutdowns impact everything from processing passport applications to providing small business loans to regulating the alcohol and tobacco industry. Mandatory spending programs continue, such as Social Security benefits, Medicare and Medicaid, and interest payments on U.S. Treasury debt.
Historically, shutdowns only occur when Congress fails to pass a set of annual budget bills by the deadline. Over the past decade, however, lawmakers have increasingly used a process known as continuing resolutions (CRs) to cover ongoing costs without passing individual spending bills. The CRs are often crafted and voted on very quickly in the last minute, which means that lawmakers have little opportunity to review their contents. If a CR is not renewed on time, most of the federal government experiences a shutdown until new funding is passed and signed into law.
When a government shutdown occurs, the vast majority of federal employees are obligated to stop work and forfeit their paychecks. Exceptions exist for a handful of critical functions, such as air traffic control and military personnel on active duty and performing their constitutional duties. But the broader federal workforce, including contractors and Congressional staff, are furloughed during a funding lapse. This puts pressure on essential services, resulting in delayed food safety inspections, shuttered museums and national parks, and longer lines at airport security checkpoints.
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