Automatic cuts are getting a big yawn from Washington


Senate Democrats unveiled a bill to replace the sequester in part with new taxes on millionaires, which Republicans oppose. (Pete Souza/Official White House Photo)

As deadlines go, the March 1 sequester lacks punch. Nobody’s taxes will go up; the U.S. Treasury won’t run out of cash. Government offices won’t immediately turn out the lights and lock the doors. Most federal workers won’t face furlough for at least 30 days.

So Washington felt little need to cancel the Presidents’ Day break. On Friday, President Obama flew to Florida for a long weekend of golf. And Congress left town for nine days, with scant hope of averting deep cuts to the Pentagon and other agencies in the short time remaining when lawmakers return.

Instead of negotiating, party leaders were busy issuing ultimatums and casting blame. Before they left, Senate Democrats unveiled a bill to replace the sequester in part with new taxes on millionaires, which Republicans oppose. And House Speaker John A. Boehner (R-Ohio) vowed “the sequester will be in effect until there are cuts and reforms that put us on a path to balance the budget in the next 10 years,” an idea Democrats oppose.

Behind the scenes, there was real concern that the cuts eventually would disrupt critical government functions, hamper economic growth and destroy 750,000 jobs. But for now, the sequester is amorphous and slow-moving, and it has emerged as a convenient hill on which to plant a flag and fight the next battle in the ongoing partisan conflict over taxes and spending.

Even as Boehner refused to draft legislation to avert the sequester, he was looking for ways to avoid a government shutdown at the end of next month, an event that would have more immediate and spectacular consequences.

In a meeting Thursday with Senate Majority Leader Harry M. Reid (D-Nev.), Boehner suggested quick action to fund the government through the rest of this year, according to people in both parties. The current funding bill runs out March 27.

Boehner spokesman Michael Steel declined to comment, saying House leaders have not decided how to proceed. But an agreement to keep the government open would let everyone breathe a sigh of relief until August, when the next serious deadline — another increase in the federal debt limit — will once again loom.

In the meantime, lawmakers began bracing for the sequester to creep ever so slowly into people’s lives. This week, a host of Cabinet secretaries wrote letters and trooped to Capitol Hill hearings to warn that the impact will indeed be calamitous.

Furloughed inspectors will force meat and poultry plants to shut down nationwide. Wait times will soar at airport security and border crossings. Rent checks will be cut off to 10,000 elderly or disabled people and single mothers. And the FBI warned it will be less able to “penetrate and disrupt terrorist plans . . . prior to an attack.”

None of it, however, would happen right away. At a hearing Thursday, Senate Appropriations Committee Chairman Barbara A. Mikulski (D-Md.) begged a panel of top officials to give her more urgency and drama.

“Here we are, March 1st. It is now midnight. The clock has moved,” Mikulski intoned with a husky Baltimore accent. “Can’t you paint for me the picture of how sequester is triggered? Do all the lights go out in federal buildings?”

Well, no, said Daniel Werfel, controller at the White House budget office.

But there will be “intense bargaining with unions” about furloughs. Word will go out to federal contractors about contract modifications and terminations. And “governors will be digesting information about how their financial footprint will be impacted. The list goes on and on,” he said.

“And I think it could turn into a firestorm,” offered Mikulski, whose state is home to roughly 300,000 confused and dispirited federal workers.

While the Washington region is likely to be hardest hit, Sen. Mark R. Warner (D-Va.) said the rest of the nation will soon feel its share of pain if the sequester hits.

“When meat doesn’t get delivered and food prices go up, when people have to wait five hours to get through an airport line,” Warner said, “this isn’t just going to be a problem for Maryland and Virginia.”

Republicans were, for the most part, unmoved, noting that they see no reason to acquiesce to Democratic demands to replace spending cuts in part with new tax revenue.

After all, “the president last month got an enormous amount of revenue with no spending cuts. Now he’s going to get cuts with no revenue,” said Rep. Tom Cole (R-Okla.), a senior Republican on the House Budget Committee, referring to the Jan. 1 “fiscal cliff” deal to raise taxes on income exceeding $450,000.

“The president likes to talk about a balanced approach,” Cole said, “but the idea that we’re going to raise taxes again within six weeks, that’s a pretty hard sell.”

The sequester would cut spending by $1.2 trillion over the next decade. It was adopted during the 2011 debt-limit showdown and designed to be so painful that neither party would ever let it take effect. During the next seven months, it is slated to slice $85 billion out of agency budgets — including $46 billion from the Pentagon — with the cuts applied equally to every program and account, no matter how worthy.

Most social-safety net programs are exempt, and that feature has created “strange bedfellows,” said Steve Bell, an analyst at the Bipartisan Policy Center. In addition to the hard-right conservatives who want to cut spending at any cost, Bell said, “now you have liberal Democrats saying, ‘Okay, let them cut defense.’ ”

The Pentagon cuts remain problematic for many Republicans, however, and House Appropriations Committee Chairman Harold Rogers (R-Ky.) is working on a government funding bill that would make it easier for the military to handle the cuts by permitting it to shift money among accounts.

But Senate leaders are unlikely to accept such a bill, saying it would trigger a rush by Democrats to protect other agencies. Aides in both parties say Reid has urged Boehner to pass a simple government funding bill with no special provisions for any agencies, an idea Boehner is considering.

Senate Democrats, meanwhile, are pressing ahead with their plan to replace the sequester for the rest of this year, in part with higher taxes on millionaires. But in the unlikely event that the bill were to pass the Senate, it would probably die in the House.

Without a compromise to stop the sequester, some lawmakers are considering a fallback plan that would give agencies more flexibility to decide where the cuts would land. But the White House has argued strenuously against that idea, which has also split Republicans.

“The flexibility option accedes, in my view, to the fact that sequester is going to take place, and I will not agree that the sequester will take place,” said Sen. John McCain (R-Ariz.). “It’s too damaging.”

Lori Montgomery covers U.S. economic policy and the federal budget, focusing on efforts to tame the national debt.
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