Federal government shuts down over budget stalemate

The federal government is officially shut down after Congress failed to reach an agreement on a funding plan before the deadline.

(CNN)- The federal government is officially shut down after Congress failed to reach an agreement on a funding plan before the deadline. The central sticking point is healthcare, with Democrats pushing to reverse Medicaid cuts and extend enhanced Obamacare subsidies, while Republicans argue the debate should wait until December.

Senate Minority Leader Chuck Schumer said, “We need to stop these premiums from going up dramatically.” But House Speaker Mike Johnson countered, “They’re arguing a December policy debate for a September funding issue.”

The Congressional Budget Office estimates about 750,000 federal workers face furloughs, losing roughly $400 million in daily wages. Essential employees, including air traffic controllers, must continue working without pay.

Some federal services will continue, including Social Security, Medicare, veterans’ benefits, unemployment insurance, and weather forecasting. But other areas are already affected: the State Department warns of passport delays, the FDA says food inspections are limited, and national parks are operating with skeleton crews.

Nearly half of civilian Defense Department employees are furloughed, though the military remains in place. Transportation could face major disruptions, with three-quarters of FAA staff working unpaid — a key factor in widespread flight delays during the last shutdown.

As the shutdown begins, lawmakers remain deeply divided over how and when to address healthcare spending, leaving hundreds of thousands of workers and millions of Americans bracing for the impact.