The government is about to run out of money. Again. You’ve probably seen the countdown clocks on the news or heard the frantic chatter about a "government shutdown." Then, at the very last second, Congress passes something called a federal budget continuing resolution, or a CR, and everyone breathes a sigh of relief. But what actually happened?
Most people think a CR is just a "extension." It’s not. It’s a confession of failure.
When Congress can't agree on the twelve distinct appropriation bills that actually fund the government, they use a CR to keep the lights on at the previous year's spending levels. It sounds simple. It’s actually incredibly messy. Imagine trying to run a Fortune 500 company using last year’s grocery list while your current needs are changing every single day. That's essentially what the United States does for months at a time.
The Messy Reality of How a CR Actually Works
Let’s get real for a second. The federal fiscal year starts on October 1. That’s the deadline. By that date, the House and Senate are supposed to have passed all their spending bills and the President is supposed to have signed them.
Does that happen? Almost never.
In fact, since the modern budget process was created in 1974, Congress has managed to pass all its spending bills on time exactly four times. Four. The last time they hit the deadline perfectly was 1997. Since then, we’ve been living in the era of the federal budget continuing resolution.
A CR is a "stopgap." It basically says, "We can't agree on the new budget, so just keep spending exactly what we spent yesterday until we figure it out." It keeps the Social Security checks moving. It keeps the TSA agents at the airport. It keeps the border patrol active. But it also freezes everything in place. No new programs can start. Old, useless programs can’t be shut down. It’s legislative stasis.
Why the Pentagon Hates Continuing Resolutions
If you want to see who gets hurt most by this, look at the Department of Defense. General Mark Milley and other top brass have been vocal about this for years. When the military operates under a federal budget continuing resolution, they can’t start new "starts."
If there is a new missile technology we need to counter a threat, but the money for it is in the new budget that hasn't passed yet, the Pentagon can't buy it. They are stuck buying more of the old stuff that was authorized in the previous year's budget.
It’s a massive waste of money.
The Government Accountability Office (GAO) has repeatedly pointed out that CRs force agencies to engage in "inefficient labor-intensive practices." Basically, bureaucrats have to spend all their time figuring out how to stretch old money to cover new problems instead of actually doing their jobs. Contracts get delayed. Hiring freezes happen. Small businesses that rely on government contracts get left in the lurch because the agency doesn't know if they'll have the money in three months to pay the bill.
The "Anomaly" Loophole
Now, it’s not always a total freeze. There are things called "anomalies."
These are specific exceptions written into the federal budget continuing resolution to handle emergencies. For example, if there's a massive hurricane, Congress might add an anomaly to the CR to allow FEMA to spend more than they did last year. Or if the census is coming up and needs a huge cash infusion to hire workers, that gets an anomaly.
But these are the exception, not the rule. Most of the government just grinds along on autopilot.
The Politics of the "Cliff"
Why do we do this? Because the CR is a political weapon.
Leadership in the House and Senate use the threat of a shutdown to force the other side to blink. It’s a game of chicken. If you’re a fiscal hawk, you might want a CR because it usually keeps spending flat instead of letting it rise with inflation. If you’re a proponent of new social programs, you hate CRs because they prevent those programs from launching.
The "clean" CR is the holy grail. That’s a resolution that just extends funding without any extra political drama attached. But "clean" is a relative term in D.C. Usually, someone tries to attach a rider—a piece of legislation about something totally unrelated, like border policy or environmental regulations—to the funding bill. That’s when things get dangerous. That’s when the shutdown looms.
What People Get Wrong About Government Shutdowns
There is a huge misconception that a federal budget continuing resolution prevents all the bad stuff. It doesn't.
Even with a CR, the uncertainty causes a "slow-down." Federal employees start looking for other jobs because they’re tired of the instability. Private investors get twitchy. Ratings agencies like Fitch or Moody's look at the constant reliance on stopgap funding and start thinking about lowering the U.S. credit rating.
They did it in 2023. Fitch downgraded the U.S. from AAA to AA+, specifically citing the "repeated debt-limit political standoffs and last-minute resolutions."
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A CR is a sign of a government that can't perform its most basic function: deciding how to spend the people's money. It’s not just "politics as usual." It’s a systemic failure that has real costs. We pay more for everything because we can't plan more than 45 or 90 days in advance.
Navigating the Financial Fallout
If you’re a government contractor, a federal employee, or someone who relies on federal services, the federal budget continuing resolution era is exhausting.
So, what do you actually do?
First, look at the "expiration date." Every CR has one. That is your new deadline. If the CR expires on December 11, that’s the next day the world might end. Mark it.
Second, watch the "minibus" vs. "omnibus" talk. A "minibus" is when Congress manages to pass a few of the twelve spending bills. An "omnibus" is when they cram all twelve into one giant, 4,000-page monster at the end of the year. If they can't even get a minibus together, expect a long-term CR that lasts for the rest of the fiscal year.
Third, understand that "essential" services stay open. Your mail will still come. The FBI will still investigate crimes. But if you were planning on visiting a National Park or applying for a niche small business grant, those are the things that get hit first if the CR fails and a shutdown happens.
Practical Steps for the Next Funding Cycle
The cycle is predictable even if it's chaotic. Since we live in a world where the federal budget continuing resolution is the standard operating procedure, you have to plan for it.
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- Diversify if you’re a contractor. If 100% of your revenue comes from federal contracts, you are at the mercy of the CR cycle. Start looking at state-level or private sector work to bridge the gaps.
- Keep an emergency fund. Federal employees usually get back pay after a shutdown, but "usually" doesn't pay the mortgage in October. Having three months of liquid cash is the only way to survive the stress of the "will they or won't they" news cycle.
- Watch the H.R. numbers. Follow the specific bill numbers on Congress.gov. Don't just trust the headlines. Look for the "Consolidated Appropriations Act" or the "Further Continuing Appropriations and Other Extensions Act." Those are the real names of the bills that will decide your financial fate.
- Communicate with your lenders. If a shutdown happens because a CR failed, most banks and mortgage lenders have "hardship" programs specifically for federal workers. Call them before you miss a payment.
The reality is that the federal budget continuing resolution isn't going away. It has become the crutch that allows Congress to avoid making hard choices. Until the political incentives change, we’re going to keep living from one "cliff" to the next, watching the clock tick down, waiting for a stopgap that everyone hates but nobody can live without.