They said it would never really happen. They said the mere prospect of it would guarantee a legislative compromise that would solve the problem. They said no sane body of legislators would ever allow it to take effect.
They said all of those things about the sequestration of government funds that would occur only if the two houses of Congress and the President could not agree on a more manageable and rational fix to the perceived crisis of federal indebtedness. So they passed the measure in the summer of 2011, assuming that in the succeeding eighteen months they would surely find a solution to avoid the anticipated economic upheaval the actual imposition of a sequester would create.
The President was confident he could get Democrats to agree to reforms of entitlement programs like Medicare. The Speaker was confident that merely reforming the tax code could result in as much as $800 billion in increased revenues. Everyone seemed certain that whatever else might happen, the actual across-the-boards cuts the sequester envisioned would never happen.
But, of course, it did happen, and now that it is starting to take effect, the new question du jour is how long it will last. And the answer just may be a pretty long time. In fact, I’m not so sure that when it comes to the sequestration, we aren’t looking at the new normal.
As enacted by Congress and signed into law by President Obama, the Sequestration Transparency Act of 2012 (it was actually passed in August of 2011) requires cuts of 9.4 percent in non-exempt defense discretionary spending and 8.2 percent in non-exempt non-defense discretionary spending. It also imposes cuts of 2 percent in Medicare spending, 7.6 percent in other non-exempt non-defense mandatory programs, and 10 percent in other non-exempt mandatory programs.
Got all that? Clear as mud, isn’t it? What will all of these cuts actually mean to real people and real programs?
The answer is that we really don’t know, because most of the details of the imposed cuts are left to the discretion of the executive branch (the President) and the agencies therein. In other words, yes, the Defense Department will take a hit, but how the hit will be distributed among the thousands of line items in that Department’s budget is still being worked out. Other agencies will be similarly affected and are also subject to prioritization by the heads of those agencies.
The bottom line is that large portions of the government will have less money to do the things they are empowered (by prior Congressional enactments) to do. In other words, most agencies will probably be somewhat less able to accomplish what will otherwise continue to be their mission.
Furloughs will be imposed in many agencies. State workers in California are quite familiar with furloughs. They were imposed any number of times in recent years as the state struggled with delayed budgets and budget deficits.
To be furloughed as a federal worker will mean a likely reduction of 20 percent of your work week, with a commensurate reduction in your income. In some agencies, the furloughs will be more draconian, with non-essential personnel given the equivalent of pink slips until, if ever, the sequester is removed.
If that last bit of information sounds nasty, it is. For some, the sequester will reduce take home pay significantly, but for a smaller group, it will result in unemployment.
Services will also suffer, but not so much, in most instances, as to create a perceptible breakdown of those things most often taken care of by the government. National parks will still be open, albeit perhaps not with as much evidence of park rangers and maybe not for the extended hours we might otherwise expect. You will probably have to wait longer to get your passport renewed or to get your federally-insured mortgage approved. You also may find the lines at airport security checkpoints longer and even be told to arrive two hours before your flight instead of one.
There will, in essence, be more things that the government is responsible for that many of us will have reason to be upset about. Those of us who have done so in the past may still blame government bureaucracy, but it will now be caused by the sequester instead of the presumed innate sloth of government workers.
Some are predicting that the rising tide of citizen complaints, if not the perception by one of the political parties that they are losing voters, will break the gridlock in Washington and that the sequester will therefore be over before it wreaks too much damage to the economy. But that prediction assumes that at some point political reality will trump partisan ideology.
The alternative would be that the public just accepts a new normal and that politicians come to realize that they can live with the complaints and mild irritation from the electorate. Most Congressional districts are relatively safe for incumbents (the result of massive gerrymandering), and many in the current Congress are beholden to ideologically extreme constituencies.
And, in truth, the sequester isn’t really going to hurt the economy all that much. Taking $85 billion out of the federal budget may sound like a big deal, but in a budget of almost four trillion dollars, it isn’t really much more than chump change. Most economists predict that the effect of the sequester will be a reduction of the nation’s gross domestic product of less than one percent. In terms of unemployment numbers, what is now slightly below eight percent might creep back up to slightly over eight percent.
Of course, such an impact would not be good. Very little about the sequester will be good, unless you are one of those ideologues who believe anything that cuts the deficit is good for the country or that anything that cuts defense spending is good for the country. Folks in those camps will be more than willing to deal with the “collateral damage” attendant to the “good” results.
But for the rest of us, the sequester, while the new normal, will still be, to quote the President, “dumb.”
Ed,
Very well done article. Failure on all sides. There is one main point though, very key, that you are wrong about:
“the hit will be distributed among the thousands of line items in that Department’s budget is still being worked out. Other agencies will be similarly affected and are also subject to prioritization by the heads of those agencies.”
Stories are now becoming very public the the White House is strictly managing the cuts to be as publicly damaging as possible, and IS NOT, allowing the various agencies to manage the cuts.
This is nothing less than filthy.
Over the last 5 years every company in America has had to tighten their belts far more than this pittance. Our government could easily absorb this miniscule cuts with minimum if not zero impact to services.
This should be scandal number one on every news outlet.