Looming Shutdown

The Trump Administration warned federal agencies to prepare for permanent mass layoffs if the government shuts down on October 1, when current funding expires.

Context

Since taking office in January, President Trump has worked to reduce the federal workforce through his Department of Government Efficiency initiative. About 300,000 federal workers have left their jobs this year, with roughly 154,000 accepting buyout packages scheduled to leave the payroll on September 30. The Trump Administration and congressional Democrats have disagreed over spending priorities, particularly healthcare funding.

Firing Threats

On Wednesday, President Trump’s Office of Management and Budget directed agencies to prepare reduction-in-force plans that would permanently eliminate positions in programs without dedicated funding and those “not consistent with the President’s priorities.” 

The memo represents a change from typical government shutdowns, where employees are sent home without pay and then return to work once Congress approves new funding.

Political Standoff

Democrats have blocked a Republican proposal to extend government funding through November 21, demanding the restoration of healthcare subsidies and Medicaid funding cut under earlier GOP legislation.

“This is an attempt at intimidation,” Senate Minority Leader Chuck Schumer (D-NY) said in a statement. House Minority Leader Hakeem Jeffries (D-NY) accused the administration of plotting “mass firings” to “punish hardworking families.” Republicans countered that Democrats are making unrealistic demands that would add over $1T in spending.

Stakes

Federal workers across multiple agencies reported receiving no formal guidance about the potential shutdown, learning about the threat from news reports rather than their employers. Trump canceled a planned meeting with Democratic leaders this week, saying their demands were “unserious and ridiculous.”

The Senate plans to vote again on Monday on the Republican funding proposal, but without Democratic support, the government will shut down next Wednesday if no agreement is reached.