The U.S. is hurtling toward a government shutdown, with Democrats and Republicans seemingly no closer to agreeing on a plan and President Donald Trump threatening that scores of federal workers could lose their jobs.

Trump on Tuesday morning said “maybe a lot” of government employees could be dismissed during any shutdown. The White House last week directed agencies to draw up plans for mass firings if the government closed down. So far, no agencies have explicity called for layoffs in their shutdown plans.

With just hours to go until a midnight deadline, the impasse over spending threatens to paralyze many U.S. government operations for only the 14th time in modern history, causing the suspension of services for Americans and paychecks for federal workers. Political fallout could be widespread for both Trump and Democrats ahead of next year’s critical midterm elections.

Although last-minute spending deals have averted several other threatened shutdowns in recent years, the stakes are especially high now, with the White House threatening to fire employees rather than furlough them, and Democratic leaders under intense pressure from progressives in the party to stand up to Trump.

“I’m an optimist, but I’m a little skeptical this morning,” House Speaker Mike Johnson, a Louisiana Republican, told CNBC Tuesday.

Johnson accused Democrats of playing politics with their effort to renew health care tax credits, saying it’s an issue that doesn’t have to be resolved until the end of the year when the tax credits expire.

“Open the government and then we’ll have all the discussions,” he said. “But right now that is a red herring.”

Democratic leaders, similarly, accused Republicans of ignoring repeated pleas for bipartisan negotiation. “Their bill has not one iota of Democratic input,” Senate Minority Leader Chuck Schumer said, adding: “It’s up to the Republicans whether they want a shutdown or not.”

Trump told Politico that he didn’t think the country would blame him if the government closed down “because people that are smart see what’s happening. The Democrats are deranged.”

Deep divide

Lawmakers appeared no closer to a deal Monday after a meeting at the White House only served to underscore their deep divide. Democrats have sought an extension of health-care subsidies and a reversal of Medicaid funding cuts that were part of Trump’s signature tax legislation enacted earlier this year. Republicans are insisting on what they call a clean continuing resolution — without an array of controversial policy measures — that would extend government funding until Nov. 21.

Senate Republican Majority Leader John Thune told reporters the Democrats’ push amounted to a “hostage taking.” While there is an opportunity to discuss potential health care premium tax credit changes with Democrats, Thune said, “we can’t even have that discussion until we keep the government open.”

If the president was seeking to curry Democratic votes, it wasn’t immediately apparent. Trump, who last week canceled a planned sit-down Democratic leaders, on Monday evening posted a poorly-dubbed video on social media of Schumer and House Democratic Leader Hakeem Jeffries, set to mariachi music, suggesting the pair wanted to import new voters who “can’t even speak English.”

Trump ally Sean Hannity, on Fox News, suggested to Johnson that there was no chance Trump would give into any of the Democrats’ demands, and Johnson agreed. Meanwhile, on Capitol Hill, Democrats cheered party leaders in a closed-door meeting Monday evening that appeared to rally the troops.

Exit ramps

A shutdown would be the first since 2018-2019, when funding for the government lapsed for five weeks, including over New Year’s Day, during Trump’s first term.

Although Republicans control both chambers of Congress — as well as the White House — they appear to need the support of at least seven more Senate Democrats to clear procedural hurdles and pass a funding bill.

One possible path being discussed late Monday involves a potential compromise that would extend health care tax credits but phase down the amounts in the second and third year.

Still, GOP lawmakers expressed confidence that, even if the government shut down briefly, Democrats would eventually yield.

“A 600-pound man is more likely to pass up a donut than the Democrats are to shut down the government for any length of time, because they love the government as much as a 600-pound man loves a donut,” said Senator Lindsey Graham, a Republican from South Carolina.

Graham said he expected a “brief” shutdown while Republicans and Democrats find “common ground.” He pointed out that Republicans have previously tried to use shutdowns to extract policy concessions, only to eventually give up and fund the government without getting anything in return.

“It may be popular, but shutting the government down is not the answer to popular legislation,” Graham said. “I’ve learned that the hard way.”

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—With assistance from Zach C. Cohen, Maeve Sheehey, Steven T. Dennis and Hadriana Lowenkron.

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