Trump Eyes Deep Agency Cuts as Shutdown Hits Day Three

President Donald Trump held a closed-door meeting Thursday with Russell Vought, his White House budget director and a key figure behind Project 2025, to map out potential reductions in federal agencies amid the ongoing government shutdown. The session focused on identifying what Trump called “Democrat agencies” ripe for trimming, turning the fiscal impasse into a chance to reshape the bureaucracy.

The shutdown, now in its third day, stems from a partisan clash over a $1.7 trillion funding package that covers a quarter of the federal budget. It kicked off after a Senate vote failed to advance the bill, with Democrats insisting on protections for expiring health care subsidies and reversals of recent Medicaid reductions passed by Republicans.

Federal workers bear the brunt of the stalemate, as about 750,000 face furloughs on any given day, leading to a daily wage loss of around $400 million according to the Congressional Budget Office. Essential services like air traffic control and Border Patrol continue without pay, but non-essential operations have ground to a halt across agencies from the IRS to national parks.

Trump, fresh off his January inauguration for a second term, has leaned into the disruption. He posted on Truth Social that the shutdown offers an “unprecedented opportunity” to address waste in government, echoing themes from Project 2025, a Heritage Foundation blueprint for overhauling the executive branch that he distanced himself from during the 2024 campaign but now appears to embrace.

Vought, who co-authored the Project 2025 plan, brings a track record of pushing for smaller government. During Trump’s first term, he led the Office of Management and Budget in efforts to slash regulations and funding for programs seen as bloated by conservatives, setting the stage for today’s discussions on possible permanent layoffs.

Reports from White House insiders suggest the meeting produced a preliminary list of targets, including agencies tied to environmental initiatives and social programs that receive heavy Democratic support. Officials expect announcements on firings as early as Friday, though details remain under wraps to avoid tipping off opponents in Congress.

This marks the first shutdown since the 35-day crisis in late 2018 and early 2019 over border wall funding, which cost the economy $3 billion. That episode left many federal employees resorting to payday loans, a hardship that could repeat if the current standoff drags past mid-October when paychecks are due.

Democrats, led by Senate Minority Leader Chuck Schumer, decry the tactics as punitive politics aimed at vulnerable populations. They point to frozen funds for transit projects in Democratic strongholds like New York and green energy efforts in states such as California, arguing these moves violate norms against using shutdowns for leverage.

Republican leaders in the Senate, holding a slim majority, face internal pushback on aggressive cuts. Senate Majority Leader John Thune distanced himself from Vought’s more radical ideas, warning that permanent workforce reductions could backfire politically and complicate future budget talks.

On the economic front, the shutdown coincides with softer job growth data that might prompt the Federal Reserve to ease interest rates later this month. Analysts note that prolonged uncertainty could dampen consumer spending and business investment, adding pressure on lawmakers to negotiate.

Trump has tied the impasse to broader efficiency drives, including the Department of Government Efficiency initiative helmed by Elon Musk, which has already prompted early workforce trims. He warned in an Oval Office remark that the shutdown allows for “irreversible” changes to programs Democrats favor, signaling no quick retreat.

As talks stall, federal agencies have issued memos blaming the opposition for the lapse, a move that skirts close to Hatch Act restrictions on partisan activity in government operations. With no breakthrough in sight, the public waits to see if Trump’s meeting yields a scalpel or a sledgehammer for federal spending.