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Monday, Sep 07, 2026

Shutdown Threatens U.S. Growth, White House Adviser Warns of Possible Negative Q4 GDP

Shutdown Threatens U.S. Growth, White House Adviser Warns of Possible Negative Q4 GDP

Kevin Hassett says federal funding lapse and air-traffic disruptions could tip fourth-quarter growth into contraction
White House economic adviser Kevin Hassett cautioned on Sunday that the United States risks a negative growth rate in the fourth quarter if the federal government shutdown persists.

Speaking on the television programme Face the Nation, he cited severe air-traffic-controller shortages ahead of the Thanksgiving travel peak as a key warning sign.

“Thanksgiving time is one of the hottest times of the year for the economy … and if people aren’t travelling at that moment, then we really could be looking at a negative quarter for the fourth quarter,” he said.

The warning comes as the shutdown stretches into its fifth week, becoming the longest in U.S. history.

Travel- and logistics-heavy sectors are already under strain: repeated flight cancellations, curtailed air-service volumes and supply-chain interruptions are rippling across industries.

Treasury Secretary Scott Bessent and other senior officials similarly flagged the risk of economic drag if the shutdown endures.

Analysts say the potential contraction underscores the interconnectedness of government operations, consumer confidence and real-time economic performance.

The disruption of federal services—especially during peak holiday travel—may erode both consumer spending and business investment, deepening the drag on gross domestic product.

The White House has not given a definitive timeline for reopening government operations.

With the travel season and consumer-spending window narrowing, pressure on lawmakers to strike a funding deal is intensifying.

If the impasse continues, the fourth quarter may not just slow—it could reverse, according to the senior economic adviser’s latest assessment.
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