Will sequestration really be that bad?
March budget cuts: “Everybody loses”
The drastic, far-reaching budget cuts known as the sequester that are set to carve into the U.S. federal budget on March 1 are “bad” and “will visit hardship on a whole lot of people,” President Obama cautioned Tuesday.
Indeed, Gov. Bob McDonnell, R-Va., wrote in a letter urging the White House to tender an alternative – the cuts would have a “potentially devastating impact” on his Commonwealth of Virginia and would likely “force” his and other states into recession.
Longtime Rep. Charlie Rangel, D-N.Y., took his concern a step further, broadly claiming on MSNBC that Americans are “embarrassed” for having to bear yet another fiscal crisis, and deeming it “un-American in every sense of the word.”
But as the U.S. economy careens toward its second “cliff” in two months, realization that a third waits at the base of the crevasse has moved some to observe that while sequestration is far from an ideal way to budget, the darkly-cloaked March 1 is not likely to yield the decade-long nightmare that has attracted handwringing by Democrats and Republicans alike.
It all began with one stalling tactic, which led to another: To help put to rest the 2011 debt ceiling drama, Congress and the president scheduled for 2012 a host of automatic spending cuts worth $1.2 trillion over 10 years, designed to be so blind and severe that Republicans and Democrats would be compelled to craft in the meantime an alternate, bipartisan agreement on deficit reduction. As lawmakers scrambled amid the “fiscal cliff” ordeal that seeped into 2013, they granted themselves a two-month extension.
Just over a week out, no feasible replacement exists.
Late last week Republicans began to concede the probability, inching ever higher, that Congress will not make its March 1 deadline, and the sequester, seen largely among both parties as economically devastating, will become a reality. And two days after his chief of staff insisted the White House has “not given up” on staving off the cuts with a substitute proposal, Mr. Obama on Tuesday sounded the alarm on the urgency for Republicans to come knocking with a plan.
“This is not an abstraction – people will lose their jobs,” the president warned.
During a discussion Tuesday morning in Washington, D.C., Mr. Obama’s former debt commission co-chairs Erksine Bowles – Bill Clinton’s former chief of staff – and Alan Simpson – a former Republican senator from Wyoming – laid out their proposal to achieve $2.4 trillion in deficit reduction over the next decade. Bowles said that Congress is unlikely to coalesce before March 1, but will feel pressure to act once Americans begin to experience the effects of the sequester.
“When you guys have to go out here to [Washington, D.C.’s] Reagan Airport and you have to wait three hours to go through airport security, you are going to be pissed, and so is everyone else,” Bowles said, referring apparently to the sequester’s widespread furloughs expected to impact TSA and FAA workers.
In addition to forcing reductions of 13 percent for defense programs and 9 percent for other programs, the White House Budget Office reports sequestration would also mean, among other things, reduced unemployment benefits for over 3.8 million people jobless for six months or longer; 70,000 Head Start students removed from the pre-kindergarten program; layoffs of 10,000 teachers and other school staffers; and fewer border security agents and less money to house detained illegal immigrants.
Flanked by first responders Tuesday, the president also listed them among the hundreds of thousands of Americans that could join the unemployment rolls if the sequester goes into effect.
Senate Minority Leader Mitch McConnell, R-Ky., countered with a statement: “Surely the President won’t cut funds to first responders when just last year Washington handed out an estimated $115 billion in payments to individuals who weren’t even eligible to receive them, or at a time when 11 different government agencies are funding 90 different green energy programs. That would be a terrible and entirely unnecessary choice by a president who claims to want bipartisan reform.”
With such repercussions on the line, Washington Post columnist and former George W. Bush speechwriter Michael Gerson guessed on Sunday’s “Face the Nation” that with the heat turned up after March 1, Congress will ultimately be motivated to deal with the harmful sequester cuts as it debates the subsequent fiscal crisis postponed by Washington: The continuing resolution (CR) of 2013, which, as a stopgap, has only set funding for the federal government until March 27 instead of through the end of the fiscal year on Sept. 30. Congress must extend the CR by March 27 or else it risks completely shutting down the government.
Obama: Sequestration “not an abstraction – people will lose their jobs”
The sequester is “going to have the serious consequence for a lot of people, but it’s not like shutting down the government,” Gerson said. “And there are some expectations that maybe this issue could be rolled into… the continuing resolution debate in March, and you might get some resolution.”
But a new month and a new fiscal fight do not assure new collaboration. In his speech Tuesday, Mr. Obama implored Republicans to work with him to negotiate a “balanced” package, but stipulated he will “not sign a plan that harms the middle class.” The president and his advisers have been calling for a proposal that reaches the magic $4 trillion mark economists have said will stabilize the country’s debt crisis, through a combination of spending cuts and revenue increases. Republicans say it’s a non-starter.
“Once again, the president offered no credible plan that can pass Congress – only more calls for higher taxes,” House Speaker John Boehner, R-Ohio, said in a statement following the Mr. Obama’s remarks. “Just last month, the president got his higher taxes on the wealthy, and he’s already back for more. The American people understand that the revenue debate is now closed. We should close loopholes and carve-outs in the tax code, but that revenue should be used to lower rates across the board. Tax reform is a once-in-a generation opportunity to boost job creation in America. It should not be squandered to enable more Washington spending.”
Speaking with reporters Monday, Sen. Lisa Murkowski, R-Alaska, sounded similar concern: “Nobody likes this meat cleaver approach,” she said of sequestration. “This is pretty tough medicine. …I don’t think that’s the best proposal, but I also don’t think that a wise proposal is one-for-one, taxes for cuts. I think it’s time we put some real serious cuts in place.”
Even if lawmakers manage to hold the sequester effects to just three weeks, though, “this is an absurd way to do budgeting,” Gerson said. “It really is a heartless, mindless, brainless way to do budgeting, but it’s the path of least resistance right now.”
As some of her colleagues in Congress suggest a vote to again delay the sequester cuts, Murkowski, too, grieved contemporary legislating: “We go from impasse to crisis and then we punt,” she said. “That’s not governing.”
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