Is The Sequester Overhyped ?

Now let me be clear that I am not advocating going over the sequester cliff (how’s that for mixing metaphors) nor do I think that we will. But in listening to the dire predictions in the media and among various politicos I have to wonder how bad it really would be, assuming that it was implemented in a sensible and prudent manner.

The numbers vary depending on who you listen to but it seems reasonable to say that no agency would be facing much more that a 10% cut in spending should things go through.

Now take a moment and consider your own personal budget.

Would a ten percent cut in spending be tough ?

You bet it would.

But would you have to stop eating, move into your car and take grandma out of her retirement home the first day ?

Probably not.

Certainly there would be difficult decisions to be made. Things like cable TV, cell phones, eating out for lunch, etc would pretty quickly face the chopping block or at least serious cutbacks. It would be tough for a family of four to have to survive with just one or two cell phones, sharing them as needed, but things could be worked out. It would be a sacrifice to no longer be able to watch all those TV or movie channels but you’d survive.

And I also understand that even deeper cuts might have to happen. Meals at home would be much more basic. Lots of pasta and rice, much less meat and not much in the way of treats. You’d have to watch the electrical bill and when you might just have to walk rather than drive when your destination was close enough.

Of course if you wanted to make things look bad you could easily do some of the more drastic things like shutting off the power entirely or going without meals but it would be more show than necessity.

I think the same circumstances apply to the potential sequester cuts.

Would it be hard for the various departments to implement them ?

Absolutely

But would they have to immediately pull guards off the border, shut down day care centers and throw old people out on to the street ?

Probably (almost certainly) not

Yes you might have to have an agency work 4 days a week instead of 5, you might have to delay planned expansions or improvements (and heaven forbid you might have to tell upper management to hold off on that week long conference in Hawaii).

But you would certainly not have to cut things to the bone as some are suggesting.

Of course this kind of behavior is hardly new. Whenever the government needs to reduce spending the first things they go after are those that will make the public upset because then they can argue for increased taxes.

I do think that we will avoid the sequester and I think that we should try to do so. Rhetoric aside the fact is that having it go through would result in damage to our credit rating and that is important to avoid.

I also think the Republicans need to step up to the plate and show a willingness to cooperate with the Democrats (who control both the White House and the Senate versus just the House for the GOP). I think they need to accept that some tax increases are probably going to have to happen and that all of the spending cuts they want aren’t going to occur.

And in the long term I think both parties need to accept the need for major reforms. We are going to need both tax increases and spending cuts to cure this problem and we have to address entitlement reform. Both sides are going to have to give.

And one nice step would be to stop playing the fear game when it isn’t entirely necessary.

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Author: PATRICK EDABURN, Assistant Editor

  • http://cma-steadystate.blogspot.com steadystate

    Patrick, I agree on a lot of points. I do think that the each media outlet (of all persuasions) is looking to the be THE source of crisis hysteria; the reality TV coverage of political gridlock.

    I have heard the meat-cleaver versus the scalpel analogy a lot with regards to the sequester; that the cuts aren’t targeted such that notable/important programs will avoid cuts as the fat gets lipo-ed.

    I found this article on the WaPo’s website to be pretty enlightening: http://www.washingtonpost.com/blogs/wonkblog/wp/2013/02/20/the-sequester-absolutely-everything-you-could-possibly-need-to-know-in-one-faq/

    In the end, I ultimately agree on this point: “And one nice step would be to stop playing the fear game when it isn’t entirely necessary.” On both sides. Cuts are going to hurt, one way or another, and playing up the pain isn’t going to help. That said, we will have a debt problem today and a debt problem tomorrow, but it’s still < 100% of GDP, so while I agree there’s a problem that needs to be controlled, I don’t see tomorrow as the end of the world because we are carrying a high debt-load.

    (That said, I do have a personal connection to the effects of the sequester… my dad works for a company in that gets most of its work via defense contracts.)

  • Jim Satterfield

    The phrase “entitlement reform” needs to be eliminated. Be straightforward about what does and doesn’t need to be done with Medicare, Medicaid and Social Security. Don’t lump them together under that phrase because the problems faced by each are very different. Also, the word reform is being mutilated beyond recognition. Simple budget cutting is not reform yet that word is constantly used by people whose ideas are limited to doing nothing except cutting funding.

  • slamfu

    Yes, it is overhyped. We have a budget in excess of $3 Trillion. $85 billion is not something that’s going to upend the economy. Sure, $85 billion is a scary number to individuals, but to anyone that is working big picture and knows the total numbers, not that big a deal. Its going to suck for a lot of people that are using specific govt programs, but no where near the majority of Americans.

  • clarkma5

    A 10% cut is manageable, sure, but let’s not forget how much cutting has been going into government programs for years now. The phrase “blood out of a turnip” probably applies to many of these programs and groups that are facing cuts.

    A couple articles over we’ve got the EU facing record unemployment and welfare. That’s the result of an austerity state. The sequester looks too much like the endless spending cutting that is crippling Europe and I don’t like the look of it, though there are several cuts within it that I would like to see happen, and many more outside of it that should happen too.

    But I want to stop talking about how we spend too much and start talking about how we don’t pay for the lifestyle we want to have.

  • Jim Satterfield

    I think of the people who will immediately lose 20% of their income when their hours are cut, not the agency involved. And that’s only through April as I understand it. Then if nothing is resolved they lose their jobs. It’s 800,000 DoD civilian employees as I understand it. And that’s only in the DoD. If a slow and gradual approach is taken and revenues are increased as well then it won’t be a shock to the system. I think that the impact won’t be immediate but that by the end of the year it could be enough to put parts of the country, if not the whole country, into a recession.

  • rudi

    The story line isn’t over hyped. I thought that the sequester was supposed to be a poison pill that wouldn’t happen. Seems the Rethugs(who enacted this) is reveling in the sequester.
    http://www.auburn.edu/~johnspm/gloss/sequestration
    http://uspolitics.about.com/od/thefederalbudget/a/What-Is-Sequestration.htm

  • zephyr

    The phrase “entitlement reform” needs to be eliminated. Be straightforward about what does and doesn’t need to be done with Medicare, Medicaid and Social Security.

    Thank-you Jim. That overused buzz phrase should be canned.

  • dduck

    From Bob Woodward’s book: “Reid said he had told his staff at the time, “Get the hell out of here. That’s insane. The White House surely will come up with a plan that will save the day. And you come to me with sequestration?”
    http://www.nytimes.com/2013/02/22/opinion/brooks-the-dc-dubstep.html

  • hyperflow

    I work in science. The biggest problem is that no one knows how to plan even for the next few months ahead.
    That’s a huge problem because it slows down progress even without cutting a single dollar.