Will the U.S. Ever Get a Budget?

Ethan Shenker

On October 1, 2025, the United States federal government shut down. 

It would not reopen for 43 days. When President Trump signed the funding bill on November 12, it brought an end to the longest government shutdown in American history, the 11th one to result in federal employees being furloughed, and by a significant margin the most damaging. According to the Bipartisan Policy Center over 670,000 federal employees were furloughed, while roughly 730,000 continued to work without pay, their wages deferred to some future date that was, for weeks, entirely uncertain. Federal courts began suspending operations. Food assistance for tens of millions of Americans was frozen or delayed. And in the skies above the United States, something quietly alarming began to unfold. 

Air traffic controllers, federal employees (and therefore unpaid), began calling out. Over one weekend alone, more than 16,700 flights across the country experienced delays, and over 2,200 were cancelled outright. Transportation Secretary Sean Duffy warned publicly that portions of U.S. airspace might need to be temporarily closed entirely. 

This matters beyond the inconvenience of a missed connection. According to the International Air Transport Association (IATA), aviation directly employs 2.3 million people in the United States and generates $433.3 billion in economic output, roughly 1.6% of GDP. But when the wider supply chain, employee spending, and tourism are included, aviation touches nearly 5% of the entire U.S. economy. A staffing crisis in air traffic control is not just an operational disruption. It is a fiscal shock transmitted through one of the economy's most interconnected sectors. 

And it happened because Congress could not pass a budget. 

So why don’t the US have a budget? 

Technically, every fiscal year has a federal "budget." There are documents. There are appropriations. There are headlines declaring that Congress "funded the government." But in practice, the normal budget process has become the exception, not the rule. According to the Pew Research Center, the budget resolution has been adopted late - or not at all - in 45 of the past 51 fiscal years, including FY2026. The process is supposed to be straightforward: 

1. The President submits a budget proposal to Congress.
2. Congress passes a budget resolution setting overall spending and revenue targets. 
3. Twelve individual appropriations bills are debated, amended, and passed. 
4. The President signs all twelve before the fiscal year begins on October 1. 

What actually happens is a familiar cycle of delay, brinkmanship, and crisis management. Deadlines are missed. Negotiations collapse. Shutdown threats dominate the news cycle. And then, at the last possible moment - sometimes after the deadline has already passed - lawmakers patch things together with a Continuing Resolution (CR) : a temporary measure that keeps the government funded at prior spending levels while negotiations drag on. 

Continuing resolutions are not budgets. They are placeholders. Fiscal duct tape. And they have become the norm. 

Is this just a political problem? 

At first glance, chronic budget delays might look like routine political dysfunction, another headline in an era where chaos feels ordinary. But the economic consequences run deeper than procedural inconvenience, and for future economists, they are worth taking seriously. 

First, the dollar runs on confidence. Since the U.S. abandoned the gold standard, the value of the dollar has rested on institutional trust: the belief that the government will honour its debts, that Treasury bonds will be repaid, that tax revenues will keep flowing, and that Congress will authorise spending in a reasonably predictable way. When legislators routinely flirt with shutdowns or edge toward default, that trust erodes, gradually, but measurably. 

But “gradual” has caught up to us. In 2025, Moody's downgraded the U.S. credit rating, citing over a decade of rising federal debt driven by persistent fiscal deficits, increased spending, and reduced tax revenues. In their assessment, political dysfunction surrounding debt and budgeting had become a structural risk, not a temporary disruption. A credit downgrade raises borrowing costs, meaning that fiscal dysfunction literally makes government debt more expensive to service, compounding the very problem it reflects. And second, the real economy runs on budget lines. Federal spending is not separate from the productive economy, it is woven into it. Energy companies rely on regulatory funding and subsidies. Agriculture depends on farm programs and crop insurance. Defence contractors operate on multi-year appropriations. States construct their own budgets on the assumption that federal transfers will arrive on schedule. When Congress funds the government through short-term continuing resolutions, none of these actors can plan with confidence. New programs cannot begin. Contracts stall. Hiring freezes kick in. Long-term investment becomes harder to justify.

From a macroeconomic standpoint, this is a supply-side drag. Continuing resolutions preserve yesterday's spending allocations rather than directing resources toward new priorities. They are, in effect, a form of fiscal inertia, and this inertia has a cost. 

Uncertainty itself is the problem. Economists have long recognised that uncertainty suppresses investment. When businesses and governments cannot rely on stable fiscal policy, they respond rationally by delaying capital expenditure and deferring decisions. The budget process, when it functions properly, reduces this uncertainty. When it does not, the dysfunction becomes a negative externality, one that diffuses across the economy in ways that are difficult to trace back to any single vote or deadline. 

So, will the U.S. ever "get" a budget? 

Technically, it always has one. Functionally, it has not followed its own intended process consistently for decades. The real question is whether Congress will return to predictable, timely, and deliberate fiscal governance: passing all twelve appropriations bills before October 1, treating the debt ceiling as a procedural formality rather than political leverage, and making continuing resolutions the rare exceptions they were always supposed to be. 

Right now, the incentives favour spectacle over structure. Brinkmanship generates media coverage; routine governance does not. While this might be the preference of politicians, markets prefer structure and creditors prefer predictability. And the foundational logic of fiscal policy, that governments can make credible long-term commitments, depends on institutions that actually follow their own rules. 

When I chuckled in that gallery, it was because dysfunction had become so normal that the idea of Congress passing a budget on time felt faintly absurd. That instinct itself is the problem. A budget should not be remarkable. It should not be dramatic. It should not be negotiated at 2 a.m. under the threat of a shutdown. 

It should be routine. 

Because when something as foundational as the federal budget becomes optional in practice, it raises a question that goes beyond fiscal policy: if the most powerful government in the world cannot follow its own calendar, what else might eventually become negotiable?

References 

DeSilver, D. (2025, October). Congress has long struggled to pass spending bills on time . Pew Research Center. https://www.pewresearch.org/short-reads/2025/10/01/congress-has-long-struggled-to-pas s-spending-bills-on-time/ 

Funk, J. (2025, November 4). Transportation Secretary warns of “mass chaos” in skies if shutdown continues . AP News. https://apnews.com/article/government-shutdown-air-traffic-controllers-duffy-delays-9afe dfa9e5000510c77465808404c830 

IATA. (2023). The Value Of Air Transport To The United States Of America . https://www.iata.org/en/iata-repository/publications/economic-reports/the-value-of-air-tra nsport-to-the-united-states-of-america/ 

Library of Congress. (2025a). Continuing Resolutions: Overview of Components and Practices . Congress.gov. https://www.congress.gov/crs-product/R46595 

Library of Congress. (2025b). The Congressional Appropriations Process: An Introduction . Congress.gov. https://www.congress.gov/crs-product/R42388 

Mascaro, L., & Jalonick, M. C. (2025, November 5). Government shutdown becomes the longest on record, 36 days and counting . AP News. https://apnews.com/article/government-shutdown-longest-trump-republican-senators-dem ocrats-9712df6c11ef19c5df8f18c8a4f7b341 

Moody's Ratings. (2025, May 16). Ratings.Moodys.com . Moodys.com. https://ratings.moodys.com/ratings-news/443154

Till , A., & Hernandez, F. (2025). Who Is Missing Paychecks in the 2025 Shutdown—When and Where? | Bipartisan Policy Center . Bipartisanpolicy.org. https://bipartisanpolicy.org/explainer/who-is-missing-paychecks-in-the-2025-shutdown-w hen-and-where/

About the author

About the Author

Ethan B. Shenker is an Economics student at Northeastern University London, pursuing a pathway in Law and a minor in Public Health. His academic and professional interests lie at the intersection of public policy, behavioural economics, and the law. Ethan has worked in New Jersey’s state government, where he analysed economic policy initiatives and their implications. He is passionate about applying economic thinking to real-world policy problems. At Northeastern, he is an active member of the Economics discipline, representing the university on the Fiscal Policy Challenge and serving as Student Coordinator of the Budding Economists Symposium. For inquiries or collaborations, Ethan can be reached at shenker.e@northeastern.edu.