In what feels like a scene from the movie Groundhog Day, the nation is once again stuck in a budget battle between President Obama and Republican lawmakers, who are unable to reach a compromise to avert the brutal budget cuts that would be imposed on March 1 in what is known as the “sequester.”
President Obama has taken to the road to show the nation the impact of the $85 billion in cuts, holding an event yesterday with firefighters, police officers and emergency medical technicians, whose ranks the president says will be decimated if the sequester cuts go through.
“Are you willing to see a bunch of first responders lose their job because you want to protect some special interest tax loophole?” he said. “These cuts are not smart, they are not fair, they will hurt our economy, they will add hundreds of thousands of Americans to the unemployment rolls,” he said. “This is not an abstraction. People will lose their jobs.”
The cuts actually total $1.2 trillion over the next decade. They are about evenly split between military and domestic programs — a mix Congress intentionally cobbled together a year ago to force the two sides to the negotiating table. But that tactic hasn’t worked — Democrats and Republicans are still bickering, with the deadline just a week away. The one thing that’s clear is the economy will suffer if the cuts are allowed to go through.
While Obama has proposed a deficit-reduction strategy that includes curbs on tax breaks for upper-income people, Republicans want the cuts with no change in tax breaks for the wealthy.
The huge military cuts were supposed to be incentive for the GOP to compromise, but at this point many Republicans seem willing to let the sequestration cuts go through if it means they don’t have to agree to any more tax hikes. The president won the last two budget battles with Republicans, first getting Republicans to agree to raise taxes on Americans making more than $450,000 to avoid the so-called “fiscal cliff” that would have devastated American pocketbooks, then getting Republicans to agree to raise the debt ceiling without any corresponding budget cuts.
There is disagreement about how quickly the sequester cuts would go through, with some observers claiming the president is exaggerating the impact on first responders. Officials conceded that the impact of the cuts will depend on how long it takes agencies to reduce their budgets. The Defense Department is planning to give notice to 800,000 civilian workers on Wednesday that furloughs might be necessary, the New York Times reported.
“Whether these impacts are felt immediately or in the near future, they are already having negative effects on the economy,” said Amy Brundage, a White House spokeswoman. “And there are Americans who are working today who could lose their jobs if these cuts go into effect.”
The Congressional Budget Office said that if the cuts go through, the budget deficit for fiscal 2013 will dip to $845 billion after four straight years of $1 trillion-plus deficits. The CBO report said the nation’s economy is being slowed by the deficit-cutting — providing fodder to liberal critics who claim that the obsessive focus on the deficit is misplaced at a time when the economy is so fragile.
