President Donald Trump is using the government shutdown as a weapon—threatening mass firings, pushing for sweeping changes to the federal workforce, and signaling ‘irreversible’ cuts to programs Democrats hold dear.
Instead of the routine furloughs that usually come with a funding lapse, White House press secretary Karoline Leavitt warned that layoffs were ‘imminent.’ At the same time, the Office of Management and Budget froze about $18 billion in infrastructure money—halting New York’s subway extension and Hudson Tunnel projects, both prized initiatives in the home state of the Democratic leaders of the House and Senate.
Trump has been openly awed by the work of his budget director.
“He can trim the budget to a level that you couldn’t do any other way,” President Trump said earlier this week, praising OMB Director Russ Vought — a key architect behind the Project 2025 conservative policy blueprint.
“So they’re taking a risk by having a shutdown,” Trump warned during a White House event
It’s only Day 2 of the shutdown, and the temperature is already boiling. The Trump administration’s hard-hitting strategy is precisely the nightmare lawmakers and budget watchers warned about if Congress dropped the ball and handed the reins to the White House.
On a private call with House Republicans Wednesday afternoon, Vought said layoffs would begin within the next couple of days. The move extends the Department of Government Efficiency’s Musk-led cost-cutting drive that tore through the federal workforce earlier this year.
“These are all things that the Trump administration has been doing since January 20th,” said House Democratic Leader Hakeem Jeffries, pointing to the president’s first day in office. “The cruelty is the point.”
The economic effects
As the deadlock shows no sign of ending, the shutdown risks spilling deeper into October — a month when federal workers still reporting for duty could start going unpaid. The nonpartisan Congressional Budget Office estimates that on any given day, roughly 750,000 employees would be furloughed, resulting in $400 million lost in wages each day.
The fallout could extend beyond Washington, hitting the wider economy. Past shutdowns, the CBO warned, led to “reduced aggregate demand in the private sector for goods and services, pushing down GDP,”
Shutdown impact on federal agencies
How different parts of the federal government are coping with the shutdown caused by Congress failing to fund operations:
“Stalled federal spending on goods and services led to a loss of private-sector income that further reduced demand for other goods and services in the economy,” the CBO said. While the slowdown dampened overall economic output, the effect quickly reversed once employees went back to work.
“The longer this goes on, the more pain will be inflicted,” said House Speaker Mike Johnson, R-La., “because it is inevitable when the government shuts down.”
No meetings scheduled
Trump and congressional leaders are not expected to meet again anytime soon. Congress has no scheduled action Thursday in observance of the Jewish holy day, with senators returning Friday and the House set to resume next week.
Democrats are holding the line on health care funding, rejecting any bill that falls short and cautioning that millions of Americans could see drastic price hikes. According to the Kaiser Family Foundation, premiums on the Affordable Care Act exchanges could more than double.
Republicans are signaling a willingness to negotiate on health care, yet GOP leaders insist it can wait, since the subsidies that support private insurance won’t run out until year’s end.
“We’re willing to have a conversation about ensuring that Americans continue to have access to health care,” Vice President JD Vance declared Wednesday at the White House.
Reshaping the federal government
With Congress gridlocked, the Trump administration is seizing new tools to reshape the federal government on its own terms.
The Trump administration can draw on funds to pay workers at the Defense Department and Homeland Security from what’s commonly called the “One Big Beautiful Bill,” passed into law this summer, according to the CBO.
That would allow Trump’s immigration enforcement and mass deportation agenda to continue without interruption. Meanwhile, employees still working at many other agencies will have to wait until the government reopens to receive a paycheck.
Already this year, Vought at the budget office has pushed the limits of Congress’s authority, trying to reclaim funds previously approved for Head Start, clean energy infrastructure, overseas aid, and public radio and television.
The Government Accountability Office has flagged several rare instances of the administration breaking the law. But last week, the Supreme Court cleared the way for the administration’s controversial “pocket rescission” of nearly $5 billion in foreign aid.
