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Week In Review: Washington’s Lack of Compromise Leads to Sequestration

February 26, 2013

Shannon Brobst, ’15

On March 1, sequestration will take place if the Democrats and Republicans do not come to an agreement. According to the article “Hard Budget Realities as Agencies Prepare to Detail Reductions” by Jonathan Weisman from the New York Times, sequestration will cut about $85 billion dollars from the federal government’s expenditures. The sequester trims the budget by $11 billion, while only slightly affecting entitlement spending. Most of the cuts will affect discretionary spending. It leaves over $70 billion in cuts to affect military, education, and many other programs. The cuts will not affect Medicaid or Social Security.

The sequester was designed to cut back the budget and cut sectors that both Republicans and Democrats care about in order to encourage bipartisanship. Democrats do not want budgets for entitlement programs to be cut, while Republicans do not want defense spending to be cut. Therefore, both parties need to work together and compromise to get a bill passed. Neither party really wants the sequester to take place because both sides believe there are better ways to decrease the budget deficit. The problem is that the Democrats control the Senate while the Republicans control the House. The partisan nature of Congress has resulted in a stalemate, as the House of Representatives and the Senate have each voted along party lines to reject the other’s proposals. Congress would have to enact a bill that decreases the deficit by $85 billion before March 1 if the sequester is to be avoided.  However, things look grim in terms of bipartisanship. At this point, there is more arguing and finger-pointing than compromise happening.

The parties do not want to take responsibility for sequestration because of the possible recoil to the United States economy. Weisman gives examples that unemployment benefits would be reduced, and the sequester will lead to government layoffs. The economy is already fragile and the cuts could hurt any recovery. In Aamer Madhani’s USA Today article, “GOP, White House trade barbs on Sequester” Transportation Secretary and former Republican congressman Ray LaHood says “Republicans need to step up here.” President Obama has proposed a bill including both spending cuts and higher taxes, demonstrating a compromise on cuts in spending. Democrats argue that this way the taxes would pay for the higher spending and the economy would not be affected by it as much.

According to the article “Chart of the Week: Sequestration Cuts 2.4 Percent out of Total Spending” by Elliot Gaiser from The Foundry, the $85 billion budget reduction is only a 2.4% decrease in spending. The government currently spends over $3.6 trillion. Furthermore, the sequestration hardly affects entitlements, the largest component of federal spending. Most of the cuts fall on defense. In conclusion, there should not be huge repercussions due to the sequestration taking effect.

In addition, President Obama wants to increase taxes instead of cutting spending. Gaiser explains “Washington has a spending problem not a revenue problem.” Due to the fiscal cliff scare, taxes were just increased, and the Democrats want to now increase them again. The Republicans are not budging on the issue of taxes, they would rather see defense cuts take place than taxes raised. Furthermore, higher taxes would hurt the economy more than the budget cuts because it decreases investment and decreases spending, which overall lowers real GDP. Gaiser explains that it is not the Republicans who are not compromising, but the Democrats, over their spending concerns.

Overall, no one in Washington wants the sequester to take effect. Yet there has not been any compromise, so it looks like on March 1 there will be an $85 billion budget cut in mainly discretionary spending.

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