August 2025 Budget Update

Likelihood of a Continuing Resolution (CR) or Shutdown

Status as of Sept. 3, 2025

• Schumer’s warning and the “Big Four” negotiations: On Sept. 2, Senate Majority Leader Chuck Schumer circulated a Dear Colleague letter to Senate Democrats. He warned that the Republican strategy of going it alone on appropriations was “heading our country towards a shutdown” and argued that the only way to avoid a shutdown is a bipartisan bill that can get both Republican and Democratic votes. Schumer accused Republicans and the Trump administration of prioritizing “chaos over governing” and “partisanship over partnership”, and he called on Senate Republicans to decide whether to “stand up for the legislative branch or enable Trump’s slide toward authoritarianism”. He also noted that he and House Minority Leader Hakeem Jeffries are aligned on priorities for September and emphasized that where Republicans threaten a shutdown, Democrats will “hold them accountable”.

• Calls for a “Big Four” meeting: In early August, Schumer and Jeffries formally requested a meeting with Speaker Mike Johnson and Senate Majority Leader John Thune to discuss government funding. As of Sept. 3 there has been no public indication that such a meeting has taken place. The lack of coordination among the “Big Four” leaders underscores the gridlock and increases the odds that Congress will not pass all appropriations bills by the deadline.

• Expectation of a CR: With significant policy and funding gaps between the House and Senate bills and little time remaining, most observers believe Congress will need to pass a short-term continuing resolution (CR) to avert a shutdown. As of Sept. 3, the White House reportedly favors a stop‑gap that would keep FY 2025 funding levels in place into January 2026, giving the administration more leverage in negotiations. However, House Appropriations Chair Tom Cole (R‑OK) and Senate appropriators such as Susan Collins (R‑ME) are pushing for a shorter CR that ends around mid-November, which would force Congress to complete the appropriations process before the Thanksgiving recess. A Sept. 3 federal budget update notes that House Republicans are drafting steep‑cut bills but are also moving toward a stop‑gap resolution that “could extend funding into mid-November”, and Cole has signaled he wants the CR to run only through Thanksgiving. This reflects a broader disagreement: some GOP hard‑liners and administration officials want a longer CR, while appropriators and Democrats prefer a shorter one to maintain pressure for a final deal.

• Shutdown risks: The risk of a shutdown remains real. Schumer’s letter suggests that Senate Democrats are preparing to blame Republicans if the government closes, while House conservatives may resist a bipartisan deal if it includes spending above the Trump administration’s proposed cuts. Disputes over climate and energy programs, health care funding and other social‑services cuts could derail negotiations. However, because a shutdown would disrupt services and harm both parties politically, the prevailing expectation in Washington is that lawmakers will at least agree to a brief CR to avoid an immediate lapse in funding.

As of Sept. 3, 2025, the Big Four have not yet reached an agreement, Schumer is pressing Republicans to abandon a go-it-alone strategy, and the most probable short-term outcome remains a CR into late fall, with the possibility of a shutdown if negotiations break down.