Government Shutdown


DEFINITION of 'Government Shutdown'

The closure of non-essential offices of the government due to lack of approval on the government programs budget for the upcoming fiscal year. Approval is reached if Congress passes all of the spending bills regarding the federal budget. If an agreement is not achieved, a government shutdown will close many federally run operations, and halt work for federal employees unless they are considered essential. Some organizations still stay open by running on cash reserves, but once these run out, if a solution is not found, they will also close. The shutdown stays in effect until a compromise is reached and a budget bill is passed.

BREAKING DOWN 'Government Shutdown'

Government shutdowns have happened in the past and could affect any government processing functions such as passport applications, law enforcement recruitment and testing, or Social Security card applications. Any office which does not receive funding from Congress would continue. For example the Federal Reserve would continue operating, and the Post Office, being owned but not operated by the federal government, would also continue to run. Essential employees which typically continue working might include security, such as police and firefighters, intelligence agencies and soldiers.

  1. Budget Deficit

    A status of financial health in which expenditures exceed revenue. ...
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    A situation in which income exceeds expenditures. The term "budget ...
  3. Congress

    The legislative branch of the United States government. It is ...
  4. Treasury Budget

    Data released by the U.S. Treasury on a monthly basis that accounts ...
  5. Fiscal Deficit

    When a government's total expenditures exceed the revenue that ...
  6. Social Security Administration ...

    A U.S. government agency created in 1935 by President Franklin ...
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