How a U.S. government shutdown could impact your benefits and services
Update, 6:13 p.m.: The U.S. government looked poised to avoid a prolonged government shutdown after the House of Representatives on Friday voted to approve a funding bill just hours before a midnight deadline. The bill is expected to pass in the Senate before heading to President Biden's desk for his signature.
As the fight over a federal spending bill went down to the wire, the U.S. faced a possible government shutdown that could begin at 12:01 a.m. on Saturday, Dec. 21, when current funding is set to lapse. That raises questions about what types of services and payments could be impacted just days before the holidays.
A looming shutdown stems from controversy over a spending bill that would have extended funding through March 14, but which was nixed by House Speaker Mike Johnson after some Republicans — including President-elect Donald Trump — objected to billions of dollars in spending that had been added to the bill.
Tesla CEO Elon Musk, a billionaire who spent almost $300 million to back Trump and other Republican candidates in the November election, had also voiced opposition to the spending bill, which he called "terrible." When the measure was scrapped, Musk proclaimed on X, "The voice of the people has triumphed!"
House Republicans on Friday regrouped after the failed vote on Thursday evening, with Johnson telling reporters at the Capitol he's "expecting votes this morning, so stay tuned — we've got a plan." House Republicans are set to gather on Capitol Hill at 12:30 p.m. ET.
Without congressional approval for new spending, federal agencies are typically barred from doling out money, although there are some exceptions, such as activities to protect life and property. At the same time, agencies must make decisions about which workers will stay on the job, which can lead to varying impacts on government operations.
"Shutdowns can be disruptive, leading to delays in processing applications for passports, small business loans or government benefits," David Wessel, senior fellow in economic studies at the Brookings Institution, wrote earlier this year in a blog post.
Each week of a federal shutdown will cost the U.S. economy $6 billion, due to delays in government spending and a reduction in pay for furloughed workers.
Here's what could be impacted if the U.S. government shuts down.
What happens if there is a government shutdown?
If the federal government shuts down, each federal agency will determine its own plan for how to handle a shutdown, although government operations deemed nonessential will stop happening.
Many government workers will be furloughed, although those providing essential services such as law enforcement and air traffic control will continue to report to their jobs. For instance, essential government agencies like the FBI, the Border Patrol and the Coast Guard would remain open.
However, none of those federal workers would get paid until Congress approves a new spending bill. After the shutdown ends, workers will receive retroactive paychecks covering the days they were furloughed or had to work without pay, according to the Office of Personnel Management.
That could create hardships for some government workers, as occurred during a shutdown that stretched for more than 30 days, starting on Dec. 22, 2018. During that stoppage, many federal workers turned to food pantries and other forms of aid to get through the several weeks when they didn't receive paychecks.
Could a shutdown hurt the U.S. economy?
Each week of a federal shutdown will cost the U.S. economy $6 billion, due to delays in government spending and a reduction in pay for furloughed workers, among other impacts, according to EY chief economist Gregory Daco in an email.
"A government shutdown could leave a visible mark on the economy," he wrote. "Apart from the direct macroeconomic consequences of a shutdown, financial markets and private sector confidence could also be affected."
Is Social Security affected by a government shutdown?
The nation's 67 million Social Security recipients would continue to receive their checks even if the government closes for business. Medicare will also continue to operate, which means seniors covered by the health care plan won't have their medications or treatments impacted.
That's because both Social Security and Medicare benefits are authorized by laws that don't require annual approval.
Even so, Social Security's administrative budget is discretionary, which means it needs approval from Congress, according to the AARP. As a result, some services offered by the Social Security Administration could be impacted in a shutdown, such as benefit verification and new applications for benefits, the group says.
Would a government shutdown affect the TSA or air travel?
With millions of Americans expected to travel over the holidays, there are plenty of questions about how a shutdown could impact air travel. Because they provide essential services, air traffic controllers and Transportation Security Administration agents would be required to work without pay.
About 59,000 of the TSA's 62,000 workers are considered essential and would continue working without pay during a shutdown, the TSA said in an email sent to CBS News. But a shutdown could cause delays at airports over the holidays, the agency warned.
"We expect to screen 40 million passengers over the holidays and through January 2," a TSA spokesperson said. "While our personnel have prepared to handle high volumes of travelers and ensure safe travel, an extended shutdown could mean longer wait times at airports."
Does the USPS deliver mail in a government shutdown?
Yes, because the U.S. Postal Service is an independent agency. In previous shutdowns, operations have continued. That means mail would still be delivered, and post offices will remain open.
Does the military get paid in a government shutdown?
Active-duty members of the military and federal law enforcement would continue to work, but would not be paid until Congress signs off on new spending. But most civilian personnel working for the U.S. Department of Defense would be furloughed.
Veterans Affairs and the Defense Department are expected to start alerting workers about shutdown protocols on Thursday, according to the Military Times. The impact would likely be felt in the first week of January when the first military paychecks of 2025 will be deposited, which are scheduled to include a 4.5% pay increase for all troops, the publication noted.
What closes in a government shutdown?
Many services would be put on hold or delayed if there is a shutdown, including environmental and food inspections by the Environmental Protection Agency and the U.S. Food and Drug Administration, according to the Committee for a Responsible Federal Budget, a public policy group that focuses on federal spending.
The national parks would likely close, while the National Institutes of Health could also be impacted, the group noted.
While taxes are still due, such as quarterly estimated payments due on Jan. 15, the IRS could also be impacted by furloughs, although tax filing season typically doesn't kick off until late January. Still, a shutdown plan published earlier this year notes that many IRS functions would cease, including tax audits and services such as answering calls from taxpayers.
How long could a government shutdown last?
The odds of a government shutdown have increased with the latest developments, according to Goldman Sachs analysts in a Dec. 18 research note. But, they added, "a protracted shutdown looks unlikely in our view."
A spending measure also could be passed before the Dec. 21 deadline if Republicans can revise it to appease Trump, who objected to billions of dollars in spending added to the bill, Goldman's analysts added.
"Trump's opposition was unrelated to the main components — he stated support for the spending extension, and the disaster and agricultural aid — so it is possible that a revised package could still pass before" the deadline, they wrote.
