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The History of Government Shutdowns in America

Our experts can explain why they happen and what’s at stake

Oct 1, 2025

2 min

Few events capture Washington gridlock more visibly than a government shutdown. While rare in the nation’s early history, shutdowns have become a recurring feature of modern politics—bringing uncertainty for federal workers, disruptions to public services, and ripple effects across the economy.


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How It Started


The modern shutdown era began in the 1970s after a new law, the Congressional Budget and Impoundment Control Act of 1974, established a formal budget process. Before then, funding disputes didn’t usually halt operations. But a key shift came in 1980, when the Carter administration’s Justice Department concluded that, without approved appropriations, agencies had no legal authority to spend money. That ruling set the stage for shutdowns as we know them today.


Since then, the U.S. has endured more than 20 funding gaps, ranging from brief lapses over a weekend to the record-long 35-day shutdown of 2018–2019. Each one has highlighted the partisan battles over federal spending, immigration, healthcare, or other policy priorities.


Why They Happen


Shutdowns occur when Congress fails to pass, and the president fails to sign, appropriations bills or temporary funding measures known as continuing resolutions. In practice, they reflect deeper political standoffs: one branch of government using the threat of a shutdown to force concessions on controversial issues.


They can be triggered by disputes over budget size, specific programs, or broader ideological fights. In many cases, the standoff ends when mounting political and economic costs make compromise unavoidable.


What Gets Impacted


The effects of a shutdown are immediate and wide-ranging:


  • Federal Workforce: Hundreds of thousands of employees are furloughed without pay, while others deemed “essential” must work without immediate compensation.


  • Public Services: National parks close, permits stall, museums shutter, and routine government operations—from food inspections to scientific research—are delayed.


  • Economic Ripple Effects: Contractors lose revenue, local economies near federal facilities take a hit, and financial markets often react nervously. Extended shutdowns can even slow GDP growth.


  • Citizens’ Daily Lives: From delayed tax refunds to halted small business loans, ordinary Americans feel the squeeze when government services pause.


Why This Matters


Government shutdowns are more than political theater—they expose the fragility of the budget process and the real consequences of partisan impasse. They highlight the dependence of millions of Americans on public services and raise questions about the cost of dysfunction in the world’s largest economy. Understanding why they happen and what’s impacted helps citizens gauge not just the politics of Washington, but also how governance—or the lack of it—touches everyday life.


Connect with our experts about the history, causes, and consequences of government shutdowns in America.







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