Government Shutdown Risk Rises as Trump Cancels Democratic Meeting Amid Funding Impasse

The risk of a U.S. government shutdown is rising as President Trump and congressional Democrats and Republicans remain deadlocked over federal funding, with the deadline looming at the end of September. Despite the House passing a temporary funding bill, the Senate filibuster requires bipartisan support that has yet to materialize, with disagreements centering on healthcare funding and spending priorities. The Trump administration is uniquely preparing for mass firings of federal workers during a shutdown, diverging from past practices of temporary furloughs, as a strategy to enforce budget priorities. The potential shutdown threatens to furlough hundreds of thousands of federal employees and delay critical government services, including passport processing and regulatory reviews, which could impact financial markets and economic data releases. President Trump recently canceled a key meeting with Democratic leaders aimed at averting the shutdown, further diminishing chances of a deal, as Democrats insist on reversing Medicaid cuts and expanding ACA subsidies. The standoff underscores deep partisan divisions and may have broad consequences for government operations and the economy.