Treasury Secretary Scott Bessent on Thursday reportedly warned that the government shutdown could carry economic consequences, arguing that partisan gridlock in Congress threatens to undercut the strong momentum seen in the nation’s economy this year.
“This isn’t the way to have a discussion, shutting down the government and lowering the GDP,” Bessent said during an appearance on CNBC’s Squawk Box. “We could see a hit to the GDP, a hit to growth and a hit to working America,” he added.
The warning comes amid otherwise encouraging economic data. Gross domestic product surged at an annualized 3.8 percent from April through June, exceeding expectations and surpassing the Commerce Department’s earlier projection of 3.3 percent.
Economists attributed the strength to a combination of higher consumer spending and lower imports, with the Trump administration touting the performance as evidence that its economic policies are working.
But Bessent emphasized that further gains are now at risk. He pointed squarely at Democrats for what he described as reckless brinkmanship, faulting Senate Majority Leader Chuck Schumer and House Minority Leader Hakeem Jeffries for engineering the standoff. “Sen. Schumer, Rep. Jeffries, you know, they’re weak, they’re discombobulated,” Bessent said. “They don’t represent the American people, and you know they’re making up excuses.”
The shutdown began after Senate Democrats blocked a stopgap bill passed by the House that would have extended current spending levels until Nov. 21. Democrats insisted on restoring Medicaid funding cut earlier in the summer and demanded an extension of Affordable Care Act subsidies scheduled to expire later this year. Republicans, led by President Donald Trump, rejected those terms and instead pledged to use the shutdown as an opportunity to reshape the federal government.
Trump, writing on Truth Social Thursday morning, made clear that the administration intends to seize the moment. “I have a meeting today with Russ Vought, he of PROJECT 2025 Fame, to determine which of the many Democrat Agencies, most of which are a political SCAM, he recommends to be cut, and whether or not those cuts will be temporary or permanent,” Trump declared.
“I can’t believe the Radical Left Democrats gave me this unprecedented opportunity,” he added. “They are not stupid people, so maybe this is their way of wanting to, quietly and quickly, MAKE AMERICA GREAT AGAIN!”
While Democrats framed the impasse as a fight to preserve health care subsidies, conservatives see it as another example of the opposition party prioritizing political leverage over economic stability. The Washington Post itself warned in an editorial earlier this week that Trump could use the shutdown to “maximize pain for Democrats,” including through agency closures and layoffs of federal workers — a scenario the president has openly embraced.
Bessent also directed sharp criticism at Federal Reserve Chair Jerome Powell, who has resisted White House pressure to lower interest rates. The secretary revealed that the first round of interviews for Powell’s potential replacement has already taken place, with a second round scheduled for next week. Powell’s term expires in the spring.
For Bessent, the message was clear: the economy is performing strongly under Trump’s leadership, but Democratic obstruction — and what he sees as a misaligned Federal Reserve — now threatens that progress.
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