“BEA estimates that this reduction in services provided by the federal government subtracted about 1.0 percentage point from real GDP growth in the fourth quarter.”
That was the Bureau of Economic Analysis noting that the slowdown in the Gross Domestic Product (GDP) in the fourth quarter of 2025 to 1.4 percent was largely attributable to the federal government shutdown that occurred from Oct. 1, 2025 to Nov. 12, 2025, the longest partial government shutdown in history.
The Bureau estimates about 1 percentage point, so maybe GDP for the fourth quarter would have looked more like 2.4 percent.
In fact, if you subtract inflation-adjusted federal government expenditures from the report, the fourth quarter GDP grew at about 2.74 percent. And you remove all government spending including state and local, the fourth quarter GDP of the private sector grew at almost 2.78 percent.
Still not above 3 percent, but certainly much better than the reported 1.4 percent.
Of course, you wouldn’t know any of that if you just listened to Congressional Democrats. In fact, they’re not even being asked about it by reporters.
For example, when the numbers were released, Senate Minority Leader Chuck Schumer (D-N.Y.), who waged the shutdown by directing his members to deny cloture for concession-less continuing resolution that ultimately passed, appeared on MS Now on Feb. 20 with Stephanie Ruhle, who asked “We just got GDP numbers that are not good news for the President… Are you worried that in the next few days, the President will launch some sort of major distraction that can be his lead for State of the Union? Because what I’ve just listed are not good headlines for him.” then Schumer did not even dignify it, instead pivoting to talk about Iran, saying, “The bottom line is he often does that. I’m really worried because sometimes he gets so unhinged almost when he’s in trouble like this. I’m worried what he might do in Iran. Who knows?”
Just think: The entire national economy was boiled down to “bad news for the President” and Schumer just shrugged it off. He caused the shutdown!
All told, economic output was almost $67 billion less than it would have been, growing at $85 billion instead of perhaps $150 billion if federal government expenditures had just remained the same. And that’s “bad news for the President”.
How about bad news for the United States of America?
And the full effect may never be known, the Bureau added in its release, “Due to a lapse in appropriations, some federal government agencies were closed, and some employees were furloughed from October 1 through November 12. The full effects of the partial federal government shutdown on the fourth-quarter estimates cannot be quantified because they are embedded in the regular source data that underlie the estimates and cannot be separately identified.”
That is, besides the drops in federal government expenditures, it is impossible to quantify what the other tail effects were from the shutdown, thanks to federal employees curtailing personal expenditures, flights being delayed or cancelled as Federal Aviation Administration including air traffic controllers were working without pay until finally they began calling in sick, and so forth.
At least Schumer had the dignity not to rub the lower GDP number he caused in the face of the American people, but how could reporters not even ask Democratic leaders about how they cost the economy $67 billion? Instead, they’re off parading their new shutdown of the Department of Homeland Security in a fruitless attempt to defund Immigration and Customs Enforcement (ICE) which has multi-year funding from the One Big Beautiful Bill Act that Congress enacted last year. Still, with another partial shutdown, who knows how much that will cost? Stay tuned.
Robert Romano is the Executive Director of Americans for Limited Government Foundation.
