Traders on major prediction markets Kalshi and Polymarket are placing substantial bets on a looming United States government shutdown by the end of this week. This surge in betting activity comes amid widespread outrage over the fatal shooting of a legally armed protestor by a Border Patrol agent in Minneapolis on Saturday.
Shutdown Odds Spike Following Minneapolis Incident
Following Saturday's tragic event, which resulted in the death of Alex Pretti, shutdown probabilities on the regulated exchange Kalshi jumped by a significant ten percentage points. The odds now stand above seventy-five percent, indicating a high level of market conviction that a funding lapse is imminent.
Senate Democrats Hold Crucial Votes to Avert Crisis
The power to avoid a shutdown rests firmly with Senate Democrats. All spending bills require sixty votes to pass, meaning Republicans, who hold only fifty-three seats, must secure Democratic support even if their entire caucus backs the measures already passed by the House of Representatives. Government funding is set to expire at the end of January, specifically this Saturday, without decisive Senate action.
Seven Democratic senators previously sided with Republicans in November to end the last shutdown. This group includes Catherine Cortez Masto, Dick Durbin, John Fetterman, Maggie Hassan, Tim Kaine, Jacky Rosen, and Jeanne Shaheen. Independent Senator Angus King of Maine, who caucuses with the Democrats, also joined them in that critical vote.
Department of Homeland Security Funding Emerges as Key Sticking Point
Currently, funding for the Department of Homeland Security threatens to derail the entire legislative package, placing those same moderate Democrats in a difficult political bind. The recent events in Minneapolis have intensified scrutiny on agencies like Immigration and Customs Enforcement.
Key Senators Voice Strong Opposition and Concerns
Senator Angus King stated on CBS's 'Face the Nation' on Sunday that he cannot vote for a bill that includes ICE funding under the current circumstances, citing the actions in his state and the Minneapolis shooting. He emphasised his dislike for shutdowns but noted his role in negotiating the previous solution.
Senator Jacky Rosen called for the impeachment and immediate removal of Homeland Security Secretary Noem in a Sunday social media post, labelling her an abject failure. Even before the Pretti shooting, Senator Tim Kaine raised concerns on Friday about the House funding bills, objecting to the bundling of six bills into a single up-or-down vote.
Senator John Fetterman has defended ICE agents, stating they are just doing their job and that he fully supports them, while criticising Democrats who treat them as criminals. However, in a Monday afternoon statement, Fetterman noted he wanted DHS funding stripped from the broader package of government funding bills.
Broader Political Repercussions and Bipartisan Scrutiny
The political fallout extends beyond the Senate. House Democrat Tom Suozzi told supporters in a Monday campaign email that he failed by voting for the DHS bill, admitting he failed to view the vote as a referendum on the conduct of ICE in Minneapolis.
Some Republicans are also expressing skepticism. Representatives and Senators including Michael McCaul, Thom Tillis, Bill Cassidy, Susan Collins, and Lisa Murkowski have pressed for more information, signalling bipartisan concern over the situation.
House Homeland Security Committee Chairman Andrew Garbarino has requested testimony from leaders of ICE, Customs and Border Protection, and U.S. Citizenship and Immigration Services, reiterating that his top priority remains keeping Americans safe.
As the deadline approaches, the combination of a tragic incident, intense political pressure on moderate Democrats, and complex legislative procedures has created a perfect storm, making a government shutdown a highly probable outcome according to financial markets.
