Senate Republicans on Friday dismissed an offer from Democrats to end the government shutdown in exchange for a one-year extension of expiring Affordable Care Act subsidies, extending a budget standoff now in its 38th day that is upending air travel and halting food assistance for millions.
The proposal, presented by Senate Democratic leader Chuck Schumer, sought to shrink party demands amid mounting public pressure to restore government operations.
But a senior Republican aide swiftly declared the compromise “dead on arrival,” signalling that GOP leaders remain intent on reopening the government before engaging in policy negotiations.
“No, we’re not going to do that,” Senator Steve Daines, a Republican from Montana closely aligned with leadership, said on Fox News. “Look, we’ve said open up the government.”
Shutdown anxiety filters through markets
US stocks, which had traded lower for much of the day, reversed losses after Democrats announced their scaled-back proposal.
Investors interpreted the act of exchanging offers—regardless of the outcome—as a sign that political leaders may be inching toward a resolution.
Airline stocks, among the most exposed to the shutdown’s operational fallout, briefly rallied.
American Airlines Group Inc. rose 3.2% as of 3:23 p.m. in New York, while Delta Air Lines Inc. advanced 1.9%. Southwest Airlines Co. added 2.2%, and United Airlines Holdings Inc. gained 1.7%.
Flight cuts widen, with worse ahead
More turbulence is looming for US air travel.
The Transportation Department and Federal Aviation Administration this week ordered airlines to cut capacity at 40 major airports—a 4% reduction beginning Friday, rising toward 10% by the end of next week.
Flight cuts could surge to 20% if air traffic control staffing deteriorates further, Transportation Secretary Sean Duffy warned on Fox News. Cancellations have already begun to pile up, disrupting travel plans across the country.
For airlines and passengers alike, uncertainty is mounting. “Every additional day of shutdown amplifies operational risk,” said an industry analyst. “Reduced staffing is forcing a cascading set of cuts.”
Food aid stalls for millions
The shutdown’s most acute impact falls on low-income households.
Federal support for nutrition assistance has been frozen for 42 million Americans, leaving food banks bracing for demand spikes.
Although a federal judge on Thursday ordered the administration to release funding, the White House is appealing the ruling—raising the prospect of continued delays.
The post US government shutdown: Republicans reject Democrats’ pared-back offer appeared first on Invezz