Why did the US government shut down?


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October 02, 2025

Closed signs have sprung up across Washington and at federal sites around the US as the government shutdown takes hold.

The lights went out at non-essential government agencies after Democrats refused to give Republicans the 60 votes they needed to pass a government spending bill.

The fight is over federal subsidies for certain types of health insurance. The Republicans want to end pandemic-era help; the Democrats want to keep it in place. If the cuts happen, as many as four million people could lose their coverage as insurance premiums rocket, according to the Congressional Budget Office.

Predictably, both sides are pointing the finger at each other. Vice President JD Vance appeared at a White House media briefing on Wednesday to repeat the Trump administration's false claim that Democrats are trying to force the government to pay for the health care of undocumented migrants. But the “illegal aliens” Mr Vance was referring to are already barred from federal assistance.

Speaker of the House Mike Johnson on Thursday. AP
Speaker of the House Mike Johnson on Thursday. AP

The last time this happened was at the end of 2018 during President Donald Trump's first term. Then, the fight was over funding to build a wall along the US border with Mexico. He did not get the money he wanted and the shutdown ended after 35 days – the longest in US history.

This time, Mr Trump seems disinclined to yield to the Democrats' demands and is threatening to fire thousands of federal workers if the shutdown drags on.

On Thursday, the President said he would talk to his budget director Russell Vought to determine which “Democrat Agencies” to cut. Mr Vought was previously involved with Project 2025, a plan by the conservative Heritage Foundation to shrink and overhaul the federal government.

“I can’t believe the radical-left Democrats gave me this unprecedented opportunity,” Mr Trump said on Truth Social.

Thanks to the shutdown, about 750,000 federal employees are already being placed on furlough, which means they will be unable to work and won't be paid until the shutdown ends. Signs of Washington's dysfunction are visible on the National Mall, with the Washington Monument closed to visitors. Even the National Guard that Mr Trump sent to the US capital are now working without pay.

“Republicans and the Democrats and trying to score political points, but it does seem that both sides are just using the people, ordinary people, as the pawns in all of us,” Peter, a Scottish tourist who had come to see Washington's famous landmarks, told me near the closed visitor centre outside Congress.

“I can't help but feel sorry for people who are having to pay the groceries and all the rest of it when they're not having an income during this period.”

Another ramification is that the Labour Department will pause releasing economic data, possibly including Friday's jobs report, which would deprive the Federal Reserve of vital numbers as it considers future interest rate cuts. National park offices will be closed, health agencies will stop analysing disease data and many government services will be put on pause.

The Democrats have been in the political wilderness since Mr Trump took office eight months ago, unable to alter his agenda thanks to a Republican lock on Congress and the Supreme Court. Experts in fumbling their own messages, the Democrats are betting they can use their rare moment in the spotlight to highlight the effects of Republican policies on millions of Americans.

But in today's choose-your-own-reality America, they will struggle to sway many voters' opinions and a good part of the country will have forgotten about all this at next year's midterms anyway.

Ultimately, the shutdown will probably wipe billions from the US economy and will end up fuelling voter distrust of both parties. Get ready for a bitter fight.

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Date started: early 2020

Founders: Khawla Hammad and Inas Abu Shashieh

Based: Abu Dhabi

Sector: HealthTech and wellness

Number of staff: 4

Funding to date: Bootstrapped

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Timeline

2012-2015

The company offers payments/bribes to win key contracts in the Middle East

May 2017

The UK SFO officially opens investigation into Petrofac’s use of agents, corruption, and potential bribery to secure contracts

September 2021

Petrofac pleads guilty to seven counts of failing to prevent bribery under the UK Bribery Act

October 2021

Court fines Petrofac £77 million for bribery. Former executive receives a two-year suspended sentence 

December 2024

Petrofac enters into comprehensive restructuring to strengthen the financial position of the group

May 2025

The High Court of England and Wales approves the company’s restructuring plan

July 2025

The Court of Appeal issues a judgment challenging parts of the restructuring plan

August 2025

Petrofac issues a business update to execute the restructuring and confirms it will appeal the Court of Appeal decision

October 2025

Petrofac loses a major TenneT offshore wind contract worth €13 billion. Holding company files for administration in the UK. Petrofac delisted from the London Stock Exchange

November 2025

180 Petrofac employees laid off in the UAE

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Updated: November 06, 2025, 3:23 AM