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Republicans and Democrats Blame Each Other for Government Shutdown; Federal Employees, Military Members Working Unpaid Through Shutdown; Stock Futures Slide as Government Officially Shuts Down. Aired 7-7:30a ET

Aired October 01, 2025 - 07:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[07:00:00]

JOHN BERMAN, CNN ANCHOR: The breaking news, shutdown. While you were sleeping, the funding ran out. Democrats hold their ground on healthcare. Now, thousands of federal workers face furloughs or layoffs. We've got the latest state of play this morning from all the major players.

SARA SIDNER, CNN ANCHOR: An A.I. actress setting Hollywood on fire. Tilly Norwood's management says she has already agents clamoring to sign her. Real human actors are furious.

KATE BOLDUAN, CNN ANCHOR: And big damage already from the two hurricanes churning together in the Atlantic home seen crashing into the water in North Carolina's outer banks. And the worst of this pair of storms may still be coming today.

I'm Kate Bolduan with Sara Sidner and John Berman. This is CNN News Central.

BERMAN: And the breaking news, as of this morning, the U.S. government is officially shut down. What comes next is anybody's guess. At the center of this fight is healthcare. Democrats are demanding any funding bill include an extension of Obamacare subsidies. Republicans say they will not negotiate on that unless Democrats agree to extend current funding for seven weeks. And this bitterly divided Congress does not sound anywhere close to a deal.

(BEGIN VIDEO CLIP)

REP. HAKEEM JEFFRIES (D-NY): Republicans have adopted a my way or the highway approach. They basically have said, take it or leave it with respect to our partisan Republican spending bill that continues cuts that were first put into place in March of this year.

REP. MIKE JOHNSON (R-LA): So, the only question tonight is how long will Chuck Schumer keep the government closed? It's a dangerous gambit.

SEN. JOHN THUNE (R-SD): They release the hostage, and there are Democrats that we're hearing from who are looking for an off-ramp and want a way out. SEN. CHUCK SCHUMER (D-NY): What gives us the ability to win this argument with the American people is we are standing for what they want with healthcare and they are not.

(END VIDEO CLIP)

BERMAN: We're expecting to hear more from Republicans when they hold a news conference later this morning.

President Trump, for his part, seems to be welcoming the shutdown. He said that, quote, a lot of good could come from it. And he is threatening to use it to fire federal workers and cut programs near and dear to Democrats. The last shutdown happened under President Trump nearly seven years ago, and it lasted a record 35 days.

Let's get to CNN's Arlette Saenz live on Capitol Hill for the latest state of play. Good morning, Arlette.

ARLETTE SAENZ, CNN CORRESPONDENT: Good morning, John. It's day one of the government shutdown. There are major questions about how long this impasse will last and how exactly lawmakers will get out of it. Right now, there is no clear off-ramp as both sides are digging in and really engaging in this blame game of who is responsible for this shutdown.

Now, Republican leaders are planning to bring up the seven-week funding bill over and over for a vote, hoping that it will force Democrats to the table as the real world consequences of the shutdown become a reality. But for now, Democrats are firm in their belief that Republicans need to come to the negotiating table on Obamacare subsidies and other issues.

But there are some concerns within the Democratic Party about the kind of damage the White House budget office could cause if this government shutdown extends for a long period of time, there will be a lot of pressure on Senate minority leader Chuck Schumer to hold his caucus together. There already are some signs of cracks in that. In the vote last night to try to pass these funding bills. There were actually three senators from the Democratic caucus who crossed over to support Republicans. Senator Rand Paul was the lone Republican who went against his party on that matter.

Overall, Republicans will need eight Democrats to get on board if they want their seven-week funding bill to pass. Senate Majority Leader John Thune has indicated he's speaking with some Democrats he believes could be sway able. And Schumer, notably, when asked by our colleague, Manu Raju, if he could guarantee he could hold his caucus together, he demure a bit. Take a listen.

(BEGIN VIDEO CLIP)

SCHUMER: Look, the bottom line is, as I said, our guarantee is to the American people, that we're going to fight as hard as we can for their healthcare, plain and simple.

THUNE: There are others out there I think, who are -- who don't want to shut down the government, but are being put in a position by their leadership that should make them, ought to make all of them very uncomfortable.

[07:05:00]

So, we'll see. I mean, I think that tonight was evidence that there is some movement there.

(END VIDEO CLIP)

SAENZ: Now, there will be a key moment to watch in the coming hours as the first attempt to reopen the government will take place. At 11:00 A.M., the Senate is planning to hold two votes, one on the Democratic funding bill and another on that Republican seven-week plan. It is expected that nothing will change between what last night and this morning. So, those are unlikely to pass. So, there are major questions about how exactly this will play out whether Democrats -- enough Democrats will join Republicans on that seven-week plan or if Democrats will force Republicans to come to the negotiating table.

BERMAN: Arlette Saenz for us on Capitol Hill, and we should note, we will speak to Senate Minority Leader Chuck Schumer this morning. Sara?

SIDNER: All right. Thank you, John.

The first to suffer from the shutdown, federal workers. So far, this morning, tens of thousands of them are being furloughed. An astonishing number of layoffs are coming. The director of the Congressional Budget Office estimates 750,000 federal employees could be furloughed every single day. Many other federal workers who were deemed essential, like air traffic controllers and the TSA workers, they will have to continue working but unpaid.

CNN's Brian Todd is at Reagan National Airport. Brian, you know, when TSA, you know, and we see that they're working there, gets furloughed when this happens, they are forced to work, but they're not paid, and I know sometimes there is a reaction to that. Have you seen any impacts this morning at the airport?

BRIAN TODD, CNN CORRESPONDENT: Well, Sara, so far, no tangible impacts of that. I'm going to show you the security line here at the north security checkpoint at Reagan National Airport. Our photojournalist David Brooks and I are going to walk toward here and show you how people are filing in here. No noticeable snafus right now, Sarah, this morning.

What I can tell you is that one of the airport employees who monitors this line, she told me that a couple of hours ago, when the TSA screeners took their places here and some of the passengers started to file in, well, she told the passengers that the TSA screeners were coming in today, starting to come in today without pay, and the passengers gave the screeners a round of applause.

Now, Sara, you mentioned how this could cause airport delays. When TSA screeners, like these people behind me, come in and are not paid, it does cause airport delays and disruptions. Because sometimes we're told screeners are having trouble paying for public transportation to get to work. They have childcare issues that they have to deal with and other things, so some of them call in sick. And that causes disruptions and delays.

Will that happen this time of any significance? That's what we're going to be paying very close attention to here at Reagan National Airport and at airports across the country. We can also tell you that some 13,000 plus air traffic controllers also coming in being forced to come into work without pay.

Now, here are some of the numbers. Sara mentioned hundreds of thousands, possibly per day being furloughed. Here's what we can tell you the numbers of people being furloughed. You got about 32,000 plus from the Department of Health and Human Services, 17,000 roughly from the State Department, 14,000 from the Department of Homeland Security. We mentioned FAA air traffic controllers. You've got more than 11,000 employees from the Department of Transportation. Those are from the FAA, and that's more than a quarter of the FAA's workforce. You've also got more than 2,000 from the Department of Education.

Now, as far as what we're talking about here, the air traffic controllers, the FAA, those employees that have been furloughed, we're told that critical services like air traffic control, of course, hiring, training, those are going to continue, things like audits, air traffic performance analysis, administrative support, those are going to cease. Again, a close eye being kept on the air traffic controllers and the TSA screeners to see if their situation causes major disruptions and delays. Sara?

SIDNER: Yes, really good reporting there from you in Arlington, Virginia. I really appreciate it. All right, Kate?

BOLDUAN: Ahead for us, what will this shutdown, especially if it is prolonged, mean for the economy and your 401(k)? We have got the numbers for you.

And here's a quote, the worst leadership in the world, the WNBA facing withering criticism from its own players facing growing calls to fire the commissioner, the exit interview that has everyone talking this morning.

And she has actually never starred in a movie, never been in a movie, but she's already sparking some serious outrage from celebrities. Her name's Tilly Norwood, the A.I.-generated actress everyone in Hollywood is talking about today.

(COMMERCIAL BREAK)

[07:10:00]

BOLDUAN: All right. Some of the breaking news this morning, stock futures are falling right now as the federal government, as you can see right there, federal government shuts down for the first time in seven years. Government shutdowns typically do not impact the overall economy in a major way, but with the economy right now looking more vulnerable, there's a lot of talk that this time could be different. Let's bring Matt Egan for more on this. And a lot of this also depends on how long this goes on and what happens in the meantime. What are you seeing?

MATT EGAN, CNN SENIOR REPORTER: Yes, Kate. Well look, the turmoil in Washington not sitting well with investors over on Wall Street.

[07:15:]

The U.S. stock futures are sinking this morning. Dow futures down about 220 points, half a percentage point. Nasdaq futures, S&P down as well.

Now, to be clear investors, they're not panicking here, right, but they are clearly taking some chips off the table. Now, I'm a little surprised at the negative reaction here because, as you mentioned, investors, they've been kind of trained that these government shutdowns, they tend to be non-events for the market and for the economy.

BOLDUAN: And especially just how it's been reacting to other disruptions in the economy.

EGAN: That's true.

BOLDUAN: Like tariffs, it's been like, meh, we'll figure it out. I mean --

EGAN: yes, you're right. There's been some big negative surprises and the markets have basically not flinched. This is not a surprise. We basically saw it coming.

But, look, when you look back in history, you can see the S&P 500 during the last government shutdown, the record-long shutdown, back then the S&P was up by 10 percent and that was not a fluke, right? The market's up the last five shutdowns, that's because the economic damage, it tends to be pretty limited and it tends to be fixed pretty rapidly when the government inevitably reopens.

But to your point though some of the economist, investors I'm in touch with, they are a little bit more concerned about this shutdown. I mean, it just feels like the stakes are higher this time. The economy is weaker. Hiring has been very weak. So, it's hard to see how another hit to confidence, both business confidence, but also consumer confidence, which is also weak, how that's going to be helped by this government shutdown.

Also, there's this threat of mass federal layoffs, that's unusual. And, look, it could just be a negotiating tactic. Maybe it's not going to happen, but if it does, it's just going to contribute to the already rising unemployment rate. And also we may be operating in a bit of an information vacuum because the shutdown means we're not going to be getting some of those major economic reports that investors and policymakers rely on starting with the Friday jobs report. That's usually the biggest number of the entire month. But that's not going to happen, Kate, if the shutdown continues. BOLDUAN: It will not come out?

EGAN: No, it's not going to come out, nor would we get these inflation reports in two weeks if the shutdown is still going on, which might mean that you could have the Fed making a decision at the end of the month, kind of flying blind.

So, look, bottom line history shows that these are non-events for the market, but the stakes are higher this time. And the longer the shutdown lasts, the bigger the damage.

BOLDUAN: I mean, let's just, you know, state at the obvious. How many times have we like broken history and like we've seen a historic everythings in the past, what --

EGAN: Week.

BOLDUAN: Exactly. So, stand by to stand by.

EGAN: Yes.

BOLDUAN: Thank you, Matt, so much. J.B.?

BERMAN: All right. All in for coal, the new plan to open millions of acres of land for new mining.

And then two highly trained hawks stolen from a pro football game, for real. Someone drove off with their vehicle and now they have not been seen in days. We've got the latest on the manhunt or hawk hunt.

(COMMERCIAL BREAK)

[07:20:00]

BERMAN: So, how was your night? Mine was pretty good. The Red Sox with a dramatic come-from-behind victory against the heavily favored New York Yankees in Yankee Stadium. Oh, Andy Scholes, what's there to say?

ANDY SCHOLES, CNN SPORTS ANCHOR: Berman, I want you to wear that in perpetuity. I just love seeing you with that Boston Red Sox giant chain on all the time. But what a win for your Red Sox, Berman. I mean, it's just great news for you as well. Teams that win game one in this best of three wild card format have gone on to win 90 percent of the time. And the story of game one was Garrett Crochet and just clutch-hitting by the Red Sox. Boston's ace went seven and two thirds inning, striking out 11 on 117 pitches.

Now, Boston wasn't able to get anything off Yankees ace Max Fried's six innings, but once he exited, they pounced on the Yankees bullpen. Masataka Yoshida coming off the bench delivering the two-run RBI single to give the Red Sox the lead. Boston went up 3-1 on an Alex Bregman double, and then our oldest Chapman came in to close it out for the Red Sox. And the former Yankees closer, he loaded the bases with no outs, but then he got a strikeout, a fly-out, and a strikeout to end the game. Red Sox take game one, 3-1. Game two tonight at 6:00 Eastern.

Shohei Ohtani, meanwhile, wasting no time, making an impact for the Dodgers in the postseason. The reigning MVP leading off the game for the Dodgers with a home run that went 117 miles per hour off his bat.

Ohtani then homered again in the sixth inning. Teoscar Hernandez. Homer twice as well for L.A. They dominate the Reds in game one, winning 10-5.

Elsewhere, the WNBA finals are now set. It's going to be the ACES versus the Mercury. Vegas getting 35 points from A'ja Wilson and 32 from Jackie Young as they beat the Fever 107-98 in overtime to win the series in five, the final start on Friday.

Now, right now in the league, there is a lot of tension between the players and leadership. And the Lynx's Napheesa Collier yesterday, during her exit interview, just laid into the league, saying there need to be changes.

(BEGIN VIDEO CLIP)

NAPHEESA COLLIER, LYNX FORWARD, RUNNER-UP IN MVP VOTING LAST MONTH: We have the best players in the world, we have the best fans in the world, but right now we have the worst leadership in the world. At Unrivaled this past February, I sat a car across from Cathy and asked how she planned to address the officiating issues in our league. Her response was, well, only the losers complain about the refs. I also asked how she planned to fix the fact that players like Caitlin, Angel and Paige, who are clearly driving massive revenue for the league, are making so little for their first four years. Her response was, Caitlin should be grateful. She makes $16 million off the court, because without the platform that the WNBA gives her, she wouldn't make anything.

(END VIDEO CLIP)

SCHOLES: And in a statement, Commissioner Cathy Engelbert responded to Collier saying, in part, I am disheartened by how Napheesa characterize our conversations and league leadership, but even when our perspectives differ, my commitment to the players and this work will not waver.

[07:25:10]

And, you know, Berman, a lot of players around the league praising Collier for her comments. The collective bargaining agreement between the players and the league, it expires on Halloween. It certainly looks like we may be heading for a lockout. We shall see.

BERMAN: Yes, the players, they want a whole lot more than what they're getting right now.

Andy Scholes, great to see you, another big day on the diamond today, thanks very much. Sarah?

SIDNER: Just -- can we just all stop for a moment and look at John Berman right now?

BERMAN: Now as the music plays. We can't stop.

SIDNER: I think, getting close here, let's examine this. Is this -- oh, yes, this looks good on, John.

BERMAN: Well, I wore it yesterday and we won, so now I can't take it off ever again.

SIDNER: Okay. Well, we will see about that. I am sure that management is so happy to see you looking sparkly this morning.

All right, ahead, how we're more than -- we are now more than seven hours into the government shutdown. Three quarters of a million federal workers a day could be furloughed. Are negotiations even underway? We'll talk to Senate Minority Leader Chuck Schumer ahead.

And a late night crossover, Jimmy Kimmel giving his first interview since his show was temporarily suspended and then came back to Stephen Colbert. It's a good one.

(COMMERCIAL BREAK)

[07:30:00]