USA PARLIAMENT MOVES TOWARD TEMPORARY DEAL TO END RECORD SHUTDOWN

The federal government shutdown in the United States of America (hereinafter: USA) reached its 40th day on 9 November 2025, following a lapse in federal funding that has significantly disrupted government operations. Efforts in the upper chamber to secure a temporary funding deal have renewed prospects for an end to the nation’s longest government shutdown. The closure, which began on 1 October 2025, now surpasses the previous record of 35 days set in 2019, marking the longest federal funding lapse in the state’s history. The impasse resulted from the failure of parliament to enact appropriations legislation for the 2026 fiscal year before the existing continuing resolution expired.

Legislative Stalemate And Negotiation Developments

The principal obstacle to restoring government operations has been the continuing disagreement within the parliament over overall federal spending levels and the future of healthcare-related tax subsidies. Lawmakers affiliated with the Democratic Party have advocated for the renewal of the expanded premium tax credits under the Affordable Care Act (hereinafter: ACA), which are due to expire at the end of 2025. Lawmakers from the Republican Party have opposed the automatic or unconditional extension of these subsidies.

On 9 November 2025, the upper chamber took a procedural step aimed at advancing a potential resolution. A group of centrist Democratic senators joined with Republican colleagues to move forward with a compromise funding package. The proposed legislation would finance several government departments and provide temporary funding for the remainder of the government until late January 2026.

The compromise proposal includes a commitment to hold a separate vote in mid-December on the issue of healthcare subsidies, rather than guaranteeing their immediate extension. The package also provides for the reinstatement of federal employees who were dismissed during the shutdown period and ensures that all furloughed workers receive back pay once funding is restored. To proceed, the measure requires at least 60 votes in the upper chamber to overcome a filibuster.

Economic And Societal Impacts Of The Funding Lapse

The federal funding lapse has resulted in the temporary furlough of an estimated 670.000 to 900.000 federal employees, while as many as two million others have continued working without immediate compensation.

The economic repercussions are substantial, with losses estimated in the billions of US dollars per week. According to projections by the Congressional Budget Office (hereinafter: CBO), reduced working hours among federal employees alone could lead to an estimated 14$ billion decline in economic output by the end of the year if the shutdown continues into late November.

Significant disruptions have been reported across multiple sectors:

• Transport and Security: Staffing shortages in essential services, including air traffic control, have led to widespread flight cancellations at major airports such as New York and Chicago.
• Social Welfare and Public Health: Interruptions to the Supplemental Nutrition Assistance Programme risked affecting more than 42 million citizens, though courts in some states have intervened to maintain benefits through November. Programmes such as Medicare and Medicaid have continued operations.
• Business and Housing Finance: The Small Business Administration (hereinafter: SBA) has been unable to process new small business loan applications, while the approval of federal housing loans through the Federal Housing Administration has been suspended.

Outlook

The most significant institutional consequence of the 40-day funding lapse is the demonstration of parliament’s inability to perform its core function: ensuring the continuity of federal operations through timely appropriations. The current situation reflects a profound legislative stalemate rooted in differing policy priorities regarding healthcare and fiscal expenditure.

While the proposed temporary funding measure may alleviate immediate disruptions, it does not resolve the underlying policy divisions. The ongoing impasse suggests that budgetary negotiations will remain a central point of contention in the months ahead, increasing the risk of further funding interruptions as fiscal policy continues to serve as a focal mechanism for political leverage within the federal legislative process.