The Political Economy of U.S. Government Shutdowns

Part 1 — Legal Foundations: How and Why U.S. Government Shutdowns Exist Part 2 – The U.S. Budget Process and Timeline: How Shutdown Risk Builds Part 3 – Historical Overview of U.S. Government Shutdowns (1976–2025) Part 4 – Who Gets Paid During a Government Shutdown Part 5 – Economic and…

1.1 Constitutional and statutory roots In the United States, Congress holds the power of the purse under Article I of the Constitution — only it can appropriate funds for federal operations. A critical statute in this framework is the Antideficiency Act (ADA) which, in its modern form, prohibits federal agencies…

2.1 Overview of the Federal Budget Cycle The United States operates on a fiscal year running from 1 October to 30 September. The process is governed mainly by the Congressional Budget and Impoundment Control Act of 1974, which established a formal timetable and institutions such as the Congressional Budget Office…

3.1 Before the “modern” shutdown era From the post-1974 budget reforms through the late 1970s, funding gaps occurred but agencies often continued operating on the assumption Congress did not intend a stoppage. The turn came with Attorney General Benjamin Civiletti’s 1980–81 opinions interpreting the Antideficiency Act (ADA) to require a…

4.1 Overview When a shutdown begins, the question of who receives pay and who must keep working without pay becomes both a legal and humanitarian issue. The controlling law is the Antideficiency Act (ADA) together with later amendments such as the Government Employee Fair Treatment Act of 2019, which now…

5.1 Introduction Every U.S. government shutdown ripples far beyond Washington, D.C. While rooted in fiscal law and political dispute, the consequences are economic, social, and psychological, affecting workers, businesses, and public confidence in institutions. Since the modern shutdown era began in 1980, the United States has learned that a few…

6.1 Introduction The phenomenon of government shutdowns is unique to the United States. Most advanced democracies experience political stalemates and budgetary crises, but not administrative stoppages. The reasons are rooted in constitutional design, legislative procedure, and political culture. Understanding these structural differences clarifies why the United States remains vulnerable to…

8.1 Why shutdowns happen (root causes) 8.2 The playbook (tactics used by negotiators) 8.3 Who wins and who loses (distributional effects) 8.4 How the media and data environment shape bargaining 8.5 The game theory of shutdown bargaining (why deals come late) 8.6 Why shutdowns persist despite their costs 8.7 Implications…

9.1 Introduction A U.S. government shutdown does not mean the entire state collapses. Instead, a complex system of continuity planning ensures that essential functions—national security, law enforcement, public safety, and critical infrastructure—continue even when funding lapses. These plans, commonly known as shutdown contingency plans or “playbooks,” are prepared under the…

10.1 What’s already been done (post-2019) 2025 wrinkle: a White House/OMB memo briefly argued back-pay isn’t automatic without a fresh appropriation, prompting bipartisan pushback that the 2019 law’s intent is to pay workers. The legal debate underscores why clearer statutory drafting helps. (Politico) 10.2 The big idea: Automatic Continuing Resolutions…

Aim: give you a compact, data-led picture of when funding gaps and shutdowns happened, how long they lasted, and what patterns emerge across parties and decades. 11.1 Definitions and sources 11.2 Long timeline (milestones) Era Key points (selected) 1976–1980 (pre-Civiletti practice) Several funding gaps occurred but agencies often kept operating;…

12.1 Introduction Government shutdowns are more than fiscal events — they are human stress tests that reveal the vulnerability of households, the strain on public servants, and the erosion of civic confidence.While macroeconomic analyses (CBO, 2019; CRS, 2025) quantify losses in billions, the social cost is harder to measure yet…

13.1 Introduction Although U.S. government shutdowns are domestically driven political events, their ripple effects reach global financial markets, given the centrality of the U.S. dollar, Treasury securities, and Wall Street in the world economy.Unlike a debt-ceiling crisis, a shutdown does not threaten debt default, but it signals fiscal dysfunction that…

Aim: connect shutdown dynamics to core theories in political science and economics, so we can explain (not just describe) why shutdowns occur, persist, and end when they do. 15.1 Veto-player theory (why gridlock is “baked in”) 15.2 Pivotal politics & the “gridlock interval” 15.3 Procedural cartels & agenda control 15.4…