What is a government shutdown and how does it impact the economy?

A government shutdown occurs when Congress fails to pass funding bills or temporary spending measures, leading to the suspension of government operations. During a shutdown, many federal agencies and services, such as national parks, museums, and certain regulatory bodies, are closed or operate with reduced staff. The impact on the economy can be significant, as government employees may not be paid, federal contractors may be disrupted, and services that support businesses and consumers may be delayed. A prolonged shutdown can also affect investor confidence and economic growth by creating uncertainty about the government’s ability to manage its finances and policies effectively.