Just before heading home last month, Congress approved a stop-gap extension of existing spending levels, known as a continuing resolution, which runs out Jan. 19. Unless extended, a series of mandatory furloughs and service cuts would kick in.
Any shutdown, even for a few days, would be costly. Congressional fiscal gridlock resulted in a 16-day stalemate in October 2013 that cost the economy more than $1 billion a day, according to most estimates.
If lawmakers miss the Jan. 19 deadline, some benefits, like unemployment insurance and veterans' benefits, could be delayed or reduced. Among the headaches: national parks, museums and many passport offices would shut down; the Small Business Administration and FHA would stop guaranteeing new loan applications; farm subsidy checks would stop flowing, and IRS tax processing would slow down.
Keeping the government spending at existing levels, or raising spending, could trigger automatic spending cuts as part of a system, known as the sequester, that was put in place in 2011 to hold the line on spending. To head off automatic cuts across the board, Congress will have to raise those spending caps.
But lawmakers have been deadlocked along party lines over how to raise the caps. Republicans want to boost military spending by $650 billion through the end of this fiscal year. Democrats insist that any increase in military spending must be matched dollar-for-dollar with higher domestic spending.
Even if they can agree on a spending plan, lawmakers face another fiscal deadline of March to increase the debt ceiling. That's when the Treasury Department is expected to run out of cash to pay the government's bills without borrowing more money.