The big sequester gamble: How badly will the cuts hurt?


President Barack Obama speaks in Chicago Feb. 15, 2013. The president and congressional Republicans each seem content with the political ground they hold and are prepared to let across-the-board spending cuts take effect on March 1. (Evan Vucci/AP)

With the ax set to fall on federal spending in five days, the question in Washington is not whether the sequester will hit, but how much it will hurt.

Over the past week, President Obama has painted a picture of impending disaster, warning of travel delays, laid-off firefighters and pre-schoolers tossed out of Head Start. Conservatives accuse Obama of exaggerating the impact, and some White House allies worry the slow-moving sequester may fail to live up to the hype.

“The good news is, the world doesn’t end March 2. The bad news is, the world doesn’t end March 2,” said Emily Holubowich, a Washington health-care lobbyist who leads a coalition of 3,000 nonprofit groups fighting the cuts. “The worst-case scenario for us is the sequester hits and nothing bad really happens. And Republicans say: See, that wasn’t so bad.”

In the long partisan conflict over government spending, the sequester is where the rubber meets the road. Obama is betting Americans will be outraged by the abrupt and substantial cuts to a wide range of government services, from law enforcement to food safety to public schools. And he is hoping they will rise up to demand what he calls a “balanced approach” to deficit reduction that replaces some cuts with higher taxes.

But if voters react with a shrug, congressional Republicans will have won a major victory in their campaign to shrink the size of government. Instead of cancelling the sequester, the GOP will likely push for more.


“It would be a big problem for the White House if the sequester came and went and nobody really noticed anything. Then people will start saying, ‘Well, maybe we can cut spending,” said John H. Makin, a resident scholar at the conservative American Enterprise Institute who penned a recent Wall Street Journal piece titled “Learning to Love the Sequester.”

Adding to the liberal angst is concern that the scale of the cuts may be overstated, at least in the short term. While the sequester orders the White House to withdraw $85 billion in spending authority from affected agencies in the fiscal year that ends in September, the nonpartisan Congressional Budget Office predicts that agencies will reduce actual spending by only about $44 billion, with the remaining cuts carried over into future years.

Compared with total 2013 discretionary spending, that’s a cut of less than 4 percent.

The impact will be magnified, however, because of certain exemptions — military payrolls, for example — and because it must be compressed into seven months rather than being spread out over 12. As a result, some agencies, notably the Pentagon, are contemplating cuts to nonexempt accounts of as much as 17.5 percent.

Still, managers at many agencies have been bracing for the cuts, postponing purchases and new hires so they can protect employees and the public from the very disruptions to core services that would draw headlines.

“This is the Catch-22,” said Richard Kogan, a former Obama budget official now at the left-leaning Center on Budget and Policy Priorities. “The problem would be solved faster if it was literally a disaster. But making it a disaster is not what agency managers really want to do.”

Administration officials insist the pain will be immediate and acute. Though furloughs of federal workers won’t begin in earnest until April, notices could begin rolling out before the March 1 deadline. On Friday, cash-strapped governors and mayors will be notified of cuts to social-service grants and reductions in education funding that will impact the coming school year. And actual federal payouts will decline immediately for at least two programs: Emergency unemployment benefits for the long-term unemployed and nutrition assistance for women, infants and children, known as WIC.

“We have a very diverse parade of horribles,” said a top White House budget official, speaking on the condition of anonymity to discuss implementation plans. “It’s going to be all over the map . . . and it’s going to hit both Democratic and Republican constituencies in a significant way.”

It’s true that the impact does “tend to get worse over time,” the official said. “But the pain points are there.”

Independent budget analysts agree that some high-profile agencies will be unable to avoid sharp cuts to critical services, including border patrols and airport security screenings.

So far, however, people aren’t paying much attention. Just 27 percent of those surveyed in a Pew Research Center/USA Today poll released last week said they had heard “a lot” about the sequester, barely half the percentage who were paying “a lot” of attention in the summer of 2011, when the sequester was adopted as part of a deal to raise the federal debt ceiling.

Liberals complain that the White House has been slow to raise the alarm. Four months ago, Obama said during the final presidential debate that the sequester “will not happen.” Throughout his reelection campaign, the White House refused to discuss the cuts or plan for their implementation.

Last fall, after Congress demanded information, the White House published a thick booklet listing 1,200 affected programs and the amounts they would be cut. But it said nothing about which services would be lost or which offices would be closed — and certainly nothing to scare budget-cutting Republicans about potential harm in their districts.

The administration’s long reluctance to spell out the gruesome details “doesn’t entirely make sense to me,” said Scott Lilly, a budget expert at the Center for American Progress, a Democratic think tank. “I think Social Security will have to close a lot of offices. And the ones that make sense to close are the ones in the smallest communities. Which, by the way, happen to be predominantly Republican.”

While Social Security benefits are protected, Lilly said, “the White House would be advantaged to let people know that they’re going to have to drive 40 miles to put in their application or get information about their benefits.”

Until a few weeks ago, many public workers who stand to be heavily affected — state public health officials, teachers, police officers — were still not fully aware of the gun to their heads, said Holubowich, who serves as executive director of the Coalition for Health Funding. But then Congress left town for the President’s Day recess and Obama headed to Florida for a long weekend of golf with no talks underway and no prospects for a last-minute deal.

“That for me was the moment I realized: Okay, this is going to happen,” Holubowich said.

Since then, the White House has been gushing information, meeting with activists such as Holubowich — and, finally, providing some concrete details. On Thursday, the National Parks Service announced that furloughs would curtail services at such popular destinations as Yellowstone, Yosemite and the Grand Canyon. And on Friday, Transportation Secretary Ray LaHood released a list of airfields that could close due to Federal Aviation Administration furloughs.

Conservatives were unimpressed. In 1981, President Ronald Reagan “fired more than 10,000 air traffic controllers. There could have been massive disruption. But there wasn’t,” said Chris Edwards, a budget expert at the libertarian Cato Institute.

Meanwhile, the screaming from state officials and private industry has also been muted. Governors in Washington for their annual winter meeting bemoaned the cuts, but while Democrats demanded an end to them, Republicans merely asked for more flexibility.

Chicken farmers in Delaware and Maryland are lobbying against cuts to food safety inspectors; the American Hospital Association is pushing to ease cuts to medical research; and defense industry executives have been prowling the halls of the Capitol for months.

But there’s no grand stop-the-sequester movement. And unless the public starts complaining, the AEI’s Makin said Democrats’ best hope for persuading Republicans to reconsider the sequester may be a new recession. The sequester is forecast to slice 0.6 percentage points from economic growth this year, and destroy 750,000 jobs.

“By summertime, if the economy gets much weaker, then the pressure to do something starts to grow,” Makin said. “Then the blame game will really get exciting, because Democrats will say if Republicans hadn’t been so awful and mean, we wouldn’t be having a recession now. And the Republicans will all panic.”

With Congress headed back to Washington Monday, Republicans so far seem to be having no second thoughts. The Senate plans to vote this week on its proposal to replace the sequester through January in part with higher taxes on millionaires, but Democrats acknowledge the measure has no chance of passing.

Meanwhile, House Speaker John A. Boehner (R-Ohio) and Senate Majority Leader Harry M. Reid (D-Nev.), looking ahead to the next major deadline at the end of March, are discussing a compromise that would keep the government open and the sequester in place.

“Having no cuts at all is far, far, far worse,” said Sen. Jeff Flake (R-Ariz.). “So I see no alternative right now.”

Lori Montgomery covers U.S. economic policy and the federal budget, focusing on efforts to tame the national debt.
SECTION: {section=politics, subsection=null}!!!
INITIAL commentConfig: {includereply=true, canvas_permalink_id=washpost.com/8bvh5zpd9k, allow_comments=true, commentmaxlength=2000, includeshare=true, display_comments=true, canvas_permalink_app_instance=bg52e9xhqr, display_more=true, moderationrequired=false, includefeaturenotification=true, comments_period=14, defaultsort=reverseChronological, canvas_allcomments_id=washpost.com/km4ey0dajm, includevoteofftopic=false, allow_videos=false, includesorts=true, markerdisplay=post_commenter:Post Commenter|staff:Post Writer|top_commenter:Post Forum|top_local:Washingtologist|top_sports:SuperFan|fact_checker:Fact Checker|post_recommended:Post Recommended|world_watcher:World Watcher|cultuer_connoisseur:Culture Connoisseur|weather_watcher:Capital Weather Watcher|post_contributor:Post Contributor, childrenitemsperpage=3, includeheader=true, includeverifiedcommenters=true, defaulttab=all, includerecommend=true, includereport=true, maxitemstop=3, source=washpost.com, allow_photos=false, maxitems=15, display_ugc_photos=false, includepause=true, canvas_allcomments_app_instance=6634zxcgfd, includepermalink=false}!!!

UGC FROM ARTICLE: {allow_comments=true, allow_photos=false, allow_videos=false, comments_period=14, comments_source=washpost.com, default_sort=, default_tab=, display_comments=true, is_ugc_gallery=false, max_items_to_display=15, max_items_to_display_top=3, moderation_required=false, stream_id=}!!!

FINAL commentConfig: {includereply=true, canvas_permalink_id=washpost.com/8bvh5zpd9k, allow_comments=true, commentmaxlength=2000, includeshare=true, display_comments=true, canvas_permalink_app_instance=bg52e9xhqr, display_more=true, moderationrequired=false, includefeaturenotification=true, comments_period=14, defaultsort=reverseChronological, canvas_allcomments_id=washpost.com/km4ey0dajm, includevoteofftopic=false, allow_videos=false, includesorts=true, markerdisplay=post_commenter:Post Commenter|staff:Post Writer|top_commenter:Post Forum|top_local:Washingtologist|top_sports:SuperFan|fact_checker:Fact Checker|post_recommended:Post Recommended|world_watcher:World Watcher|cultuer_connoisseur:Culture Connoisseur|weather_watcher:Capital Weather Watcher|post_contributor:Post Contributor, childrenitemsperpage=3, includeheader=true, includeverifiedcommenters=true, defaulttab=all, includerecommend=true, includereport=true, maxitemstop=3, source=washpost.com, allow_photos=false, maxitems=15, display_ugc_photos=false, includepause=true, canvas_allcomments_app_instance=6634zxcgfd, includepermalink=false}!!
Comments
SECTION: {section=politics, subsection=null}!!!
INITIAL commentConfig: {includereply=true, canvas_permalink_id=washpost.com/8bvh5zpd9k, allow_comments=true, commentmaxlength=2000, includeshare=true, display_comments=true, canvas_permalink_app_instance=bg52e9xhqr, display_more=true, moderationrequired=false, includefeaturenotification=true, comments_period=14, defaultsort=reverseChronological, canvas_allcomments_id=washpost.com/km4ey0dajm, includevoteofftopic=false, allow_videos=false, includesorts=true, markerdisplay=post_commenter:Post Commenter|staff:Post Writer|top_commenter:Post Forum|top_local:Washingtologist|top_sports:SuperFan|fact_checker:Fact Checker|post_recommended:Post Recommended|world_watcher:World Watcher|cultuer_connoisseur:Culture Connoisseur|weather_watcher:Capital Weather Watcher|post_contributor:Post Contributor, childrenitemsperpage=3, includeheader=true, includeverifiedcommenters=true, defaulttab=all, includerecommend=true, includereport=true, maxitemstop=3, source=washpost.com, allow_photos=false, maxitems=15, display_ugc_photos=false, includepause=true, canvas_allcomments_app_instance=6634zxcgfd, includepermalink=false}!!!

UGC FROM ARTICLE: {allow_comments=true, allow_photos=false, allow_videos=false, comments_period=14, comments_source=washpost.com, default_sort=, default_tab=, display_comments=true, is_ugc_gallery=false, max_items_to_display=15, max_items_to_display_top=3, moderation_required=false, stream_id=}!!!

FINAL commentConfig: {includereply=true, canvas_permalink_id=washpost.com/8bvh5zpd9k, allow_comments=true, commentmaxlength=2000, includeshare=true, display_comments=true, canvas_permalink_app_instance=bg52e9xhqr, display_more=true, moderationrequired=false, includefeaturenotification=true, comments_period=14, defaultsort=reverseChronological, canvas_allcomments_id=washpost.com/km4ey0dajm, includevoteofftopic=false, allow_videos=false, includesorts=true, markerdisplay=post_commenter:Post Commenter|staff:Post Writer|top_commenter:Post Forum|top_local:Washingtologist|top_sports:SuperFan|fact_checker:Fact Checker|post_recommended:Post Recommended|world_watcher:World Watcher|cultuer_connoisseur:Culture Connoisseur|weather_watcher:Capital Weather Watcher|post_contributor:Post Contributor, childrenitemsperpage=3, includeheader=true, includeverifiedcommenters=true, defaulttab=all, includerecommend=true, includereport=true, maxitemstop=3, source=washpost.com, allow_photos=false, maxitems=15, display_ugc_photos=false, includepause=true, canvas_allcomments_app_instance=6634zxcgfd, includepermalink=false}!!
Show Comments
Most Read Politics