The Shutdown Breaks
After forty-three long days of frozen agencies, missed paychecks, and anxious governors, Washington is finally stirring back to life. The Senate’s late-night breakthrough on Monday cracked the stalemate and later today the House is expected to follow suit, bringing an end to the longest government shutdown in American history.
This week’s edition offers a quick lay of the land in Washington including details of the funding package headed for the House floor, an outline of what it means for states, and flagging the next major policy fight already looming—a forthcoming Department of Labor proposed rule on independent contracting that has major impact on small business independence.
Shutdown Ends — House Eyes Wednesday Vote
After weeks of gridlock, the Senate advanced a bipartisan funding package late Monday that would reopen the government through January 30. The measure combines a short-term continuing resolution (CR) with full-year appropriations for Agriculture, Legislative Branch, and Veterans Affairs - including new funding for congressional security and retroactive pay protections for workers furloughed during the shutdown.
Speaker Mike Johnson has summoned the House back into session at 4:00 p.m. Wednesday, with votes expected shortly after. The Speaker faces a razor-thin, two-vote margin, but the bill is anticipated to pass, thanks in part to Freedom Caucus support and the political cover provided by President Trump’s endorsement.
The measure represents a temporary truce, not a long-term fix. Congress will revisit the issue early next year as deadlines for the remaining appropriations bills approach.
What’s in the Package
Continuing Resolution through January 30, 2026: Keeps most agencies funded at FY2025 levels.
Full-Year Funding for Agriculture, Legislative Branch, and Veterans Affairs: Restores operations for USDA, FDA, congressional offices, and the VA, including programs affected by the shutdown.
Federal Worker Provisions: Guarantees back pay for the funding lapses, reverses workforce reductions that took place during the shutdown, and restricts additional workforce reductions through the CR.
ACA Subsidy Vote Commitment (Senate only): Senate Republicans agreed to hold a vote by mid-December on expiring Obamacare premium tax credits. The House has not made that pledge.
Speaker Johnson has framed this as a reset moment, to restart the appropriations process and pivot toward a Republican-led health care plan instead of simply renewing the Obamacare subsidies.
What This Means for States
This resolution will restore federal transfers and reopen programs such as SNAP, WIC, Head Start, and Essential Air Service. However, the CR buys only two months of breathing room. The shutdown’s 43-day grind offered a stark reminder of how deeply state operations depend on uninterrupted federal funding. It’s a moment for reflection and reforms including:
Reduce federal dependency. States remain too tethered to Washington’s fiscal cycles. Use this moment to advance policies that strengthen independence and buffer budgets against federal volatility. Revisit your state’s ranking on SPN’s Federalism Scorecard and identify gaps in fiscal autonomy, contingency planning, and legislative oversight of federal funds.
Educate on ACA subsidies. The expiring Obamacare premium tax credits are direct payments to insurance companies that prop up a broken system and distort state health-care markets. Continue educating lawmakers and the public on why extending them would entrench higher costs.
Advance state-led health care solutions. Now is the time to promote reforms that reduce costs, expand choice, and strengthen care outside of federal mandates.
Share your ideas. If your organization has innovative health-care solutions or cost-control proposals, let me know. We can connect you with key congressional offices eager for state-based input.
This shutdown made one thing clear: Washington’s gridlock shouldn’t bring the states to a standstill. By reinforcing fiscal independence and championing federalism, states can stay steady no matter which way the capital swings.
Next Up: A Major Labor Rule on the Horizon
With Washington reopening, regulatory activity is also gearing up. One of the first major moves expected from the administration is a proposed rule from the Department of Labor redefining standards for independent contracting.
The proposal, listed on the administration’s Unified Regulatory Agenda, is expected to clarify who qualifies as an independent contractor under the Fair Labor Standards Act. This rule could reshape the legal and economic framework for millions of Americans who work as freelancers, contractors, and gig workers.
Join the Coalition Call on Independent Contracting
To prepare for the release, the Institute for the American Worker is convening a coalition call for allies and policy leaders.
Date: Tuesday, November 18 at 1:00 p.m. ET
Click here to register for the call.
Opponents of flexible work will mount a full-scale campaign against this rule so it’s critical that supporters mobilize quickly to share real-world data, personal stories, and economic evidence in defense of independent work.
As a reminder, before engaging in any federal education and outreach activities, please ensure the opportunity aligns with your current strategy and seek legal counsel before weighing in on a specific piece of legislation. The IRS does not consider 501(c)(3) participation in the federal regulatory notice and comment process as lobbying.