Most government shutdowns happen over hot button issues where the Democratic and Republican parties strongly disagree—abortion in the 1970s, Medicaid and Medicare in the ‘90s; and Obamacare, DACA and a “border wall” in the 21s century. Similarly, the record eight shutdowns that happened during Ronald Reagan’s presidency highlighted some of the biggest political battles of the 1980s, from funding for people on welfare to the Iran-Contra affair.
The fight over domestic vs. defense spending: November 20 to 23, 1981
The first shutdown where a large portion of the government actually stopped functioning came in 1981, when Reagan furloughed 241,000 of the government's 2.1 million employees without pay.
This shutdown concerned what’s known as “Reaganomics.” Reagan had campaigned on a platform of cutting domestic spending without hurting Cold War defense funding, and that’s exactly what this shutdown was over. On one side, Reagan wanted to cut domestic spending by several billion dollars; and on the other, the Democrat-controlled House wanted more defense cuts and higher wages for members of Congress and senior civil servants.
In the end, Congress and Reagan worked out a temporary bill to give them more time to work out a long-term spending plan. This was technically the seventh government shutdown over a spending bill disagreement, but the first to impact federal workers on a large scale.