MUS Policy Perspectives December 2025
Congressional leaders finally ended the federal government shutdown after a record 43 days. The majority of the federal government is now temporarily funded until January 30, 2026. However, Congress also passed, and the President signed, full fiscal year 2026 appropriations bills for the Department of Agriculture (which fully funds SNAP), Legislative Branch (congressional operations), and Veterans Affairs. These agencies are funded through September 30, 2026.
The federal workforce was directly impacted during the shutdown with additional layoffs and reductions-in-force (RIFs). The Continuing Resolution (CR) reverses those layoffs that occurred during the shutdown and prohibits any additional RIFs through January 30, 2026. With that end date a short ten weeks away (fewer legislative days when you account for the holidays and recesses), Congress needs to show progress towards a longer-term funding deal for the remainder of the federal government, including the Departments of Labor and Education.
A key driver of the shutdown divide was the expiring Affordable Care Act (ACA) enhanced subsidies for those individuals buying insurance through the ACA Marketplace. Senate Republicans have promised a vote on an extension, a policy of Democrat choosing, sometime in early-to-mid December. The outcome of that negotiation, which has a direct impact on the emerging affordability issue confronting Americans and our political leaders, may set the tone for the next stage of funding discussions and the ability of Congress to fund the government.
Meanwhile, another obstacle to bipartisanship will be the Administration’s continued effort to dismantle the Department of Education. Recently, the Trump Administration rolled over additional Education offices to other departments. The Offices of Elementary and Secondary Education and Post Secondary Education will now be administered by the Department of Labor (Employment and Training Administration). These moves have rattled Washington, in a bipartisan way, yet there has not been a formal pushback from Congress. One way to do that is by establishing guardrails in the appropriations bills – the Administration will continue pushing back on those policy restrictions to maintain their presumed ability to move pieces of the Department of Education around.
