Overview

• An OMB memorandum instructs federal agencies to identify non-mandatory programs for steep personnel cuts if funding lapses at the Sept. 30 fiscal-year deadline.
• Agencies were told to flag activities whose discretionary money would expire on Oct. 1, and OMB says it has received plans from many but not all agencies and has not posted them publicly.
• The White House push aligns with President Donald Trump’s broader effort to shrink the federal workforce, with Director Russ Vought signaling that permanent reductions are on the table.
• Democratic leaders, including Sen. Chuck Schumer and Rep. Hakeem Jeffries, condemned the guidance as intimidation and signaled legal and political resistance.
• Essential operations such as Social Security, law enforcement and air traffic control would continue, yet many workers could go unpaid and analysts warn of disruptions to regulatory reviews, economic data releases and IPO processing.