43 days without budget: how the 2025 shutdown paralyzed the United States
The focus of the conflict was on federal health spending, particularly the extension of Obamacare-related temporary grants. While the Republicans wanted to limit these subsidies, the Democrats campaigned for their sustainability, thus paralyzing the adoption of the budget.
This stalemate directly affected 1.4 million public servants: 670,000 federal employees were placed on leave without pay, while a further 730,000 had to continue working without pay. In the daily lives of the Americans, the effects were quickly felt: more than 10,000 delays and 3,000 flight cancellations in a single day, increased risk of layoffs, and widespread financial pressure on households.
At the same time, 42 million Americans expected food aid, while every week of shutdown amputated GDP growth by about 0.4 percentage points. In total, economic losses are estimated at between $7 billion and $15 billion.
The compromise reached allowed the gradual reopening of public services, even though the Republicans did not give up on health subsidies. The law adopted includes, inter alia, the reintegration of officials on leave, announcing a gradual resumption of public services.
This unprecedented period of paralysis, however, leaves lasting consequences for the U.S. economy, with shaken confidence in households, businesses and markets, and continued uncertainty about future fiscal challenges.
This historic shutdown highlights the magnitude of the political challenges the country faces in managing its public finances.
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