There’s a lot of talk on the Hill and in the political press today about how Congress might respond to the partial or total failure of the supercommittee. Many people on all sides of the aisle seem to think that, because the sequester created by the debt-ceiling deal does not take effect until January of 2013, Congress will leave it alone for most of next year and then after the election might take up the question of whether to undo the sequester to avoid the domestic and defense cuts that many Democrats and Republicans (respectively) want to avoid. A lot of Republicans are telling themselves not to worry about the defense cuts because they’ll be undone before they take effect, and some Democrats seem to think the same way about the domestic discretionary cuts.
I don’t think it’s going to work that way. At the very least, the decision about whether to allow the sequester to take effect (as, after all, Congress and the president agreed to do not so long ago and is now written into law) will not wait until a lame-duck session at the end of 2012. The President has to propose a 2013 budget in February of 2012. The House will presumably propose one in March or April. (The Senate will presumably not, since Senate Democrats haven’t drafted a budget in a couple of years and they see the debt-ceiling deal as exempting them from the requirement to do so for another couple of years.) That means that Obama and House Republicans will both have to decide how they want to approach the sequester question early in 2012. Do they assume the sequester takes effect or do they propose alternative cuts (in the case of House Republicans) or tax increases (for Obama) in its place, along with their other budget proposals?
For House Republicans in particular, a decision to undo the sequester and replace it with something else will not be simple as a matter of politics, and it does not seem like the leadership has tried to persuade members that averting the defense cuts in the debt-ceiling agreement is an important enough priority to make it worth the complicated politics. Some members certainly think so already, but do enough of them?
This isn’t a simple problem for the president either, because he has issued a veto threat against any effort by the supercommittee to undo the sequester. Will he now turn around and propose to undo it himself? (For what it’s worth, I think he will.)
Whatever they propose in their budgets, actually getting a substitute enacted will be very difficult, even if they wait until a lame duck session (when an awful lot will be on the table). Things could still change after that—if the next president values defense spending more highly, he could work out changes to the sequester with the next congress at any time. Or maybe all involved will judge it best to let the cuts take effect as planned. However it goes, it’s not going to be something the two parties can hold off until after the election. They will need to make their priorities and proposals clear well before that, and these basic fiscal questions are going to be front and center throughout the election year.
It seems to me that the Democrats and their constituencies can weather these cuts with a great deal less angst than the Republicans, and so have less incentive not to go along with the sequester. This plus the option of letting the Bush tax cuts expire, will put them a much stronger bargaining position. Cordially, Bill
Reply to this commentLinkReport AbuseEveryone will forget about this whole things in a few weeks. In the spring the GOP and White House will have a staged fight over the budget. They will agree to push the sequester off another few years in exchange for some phony-baloney nonsense. That means tax hikes and more spending. The magic deal will somehow lock in spending for a few years preventing a new president from doing anything about it.
Reply to this commentLinkReport AbuseRemember "cuts" are reductions in the rate of spending increases that may take place over a 10 year period. They will never happen.
Tax increases go into effect immediately.
Reply to this commentLinkReport AbuseWrong. Under the debt ceiling deal, defense spending is slated to be cut IN REAL TERMS in every FY, starting this FY, EVEN WITHOUT THE SEQUESTER.
Without the sequester, defense spending will still be cut by something on the order of $13 bn - $17 bn in real terms, compared to previous year's spending level, and in every consecutive fiscal year afterwards, because the slow nominal growth of defense spending that will start in FY2014 will not even be enough to keep up with inflation (even assuming a low inflation rate).
WITH the sequester, defense spending will be cut (in real terms) much deeper than that, starting this fiscal year and deepening in FY2013.
The bottom line is that with or without the sequester, defense spending will see NO GROWTH for the next decade, and will instead be cut in real terms.
Reply to this commentLinkReport AbuseIt wasn't a failure. They did exactly what they were set up to do: provide cover for the rest of congress while ignoring he debt problem.
Reply to this commentLinkReport AbuseI suggest no Senator receive a salary until they present and pass a budget. Oh wait, that won't work because magically almost all of them are millionaires.
Reply to this commentLinkReport AbuseWho would have thought that appointing Max Baucus and John Kerry to a committee would lead to failure.
Reply to this commentLinkReport AbuseAs read elsewhere at National Review, this was all smoke anyway...so who cares??
Reply to this commentLinkReport AbuseDespite Guy Benson's clear explanation of how the GOP has proposed cuts and budgets while the Dems have not, the Q-polls seem to show that the GOP will get the blame.
The GOP ought to just agree to raise taxes 5% on millionaires. It's a purely political move, and it raises very little money ($45 B at most on a deficit of $1,300 B or so). They are losing the public relations war for a Pyrrhic victory in the millionaire tax battle. Raises taxes on Buffett, demand slowed INCREASES in spending instead of cuts, and come out smelling like a rose. External Link
Reply to this commentLinkReport AbuseIt looks like the sequester is now effectively optional: it's up future congress to decide whether to actually do it. And that means Obama got what he wanted all along: a clean raise in debt limit without additional strings attached.
Reply to this commentLinkReport Abuse"A lot of Republicans are telling themselves not to worry about the defense cuts because they’ll be undone before they take effect"
And they are wrong, for the reasons outlined below.
"if the next president values defense spending more highly, he could work out changes to the sequester with the next congress at any time."
WRONG. Firstly, the sequester will kick in at the beginning of FY2013, i.e. on Oct. 1st, 2012, LONG before the next Congress and the next President will be seated. Secondly, currently Obama is more likely than not to win reelection. Republicans currently switch from one champion in shooting himself in the foot to another - Bachmann, Perry, Cain, Gingrich - instead of nominating an electable candidate. If they nominate an electable candidate, I may change that opinion. Thirdly, regardless of who will be the next President, he can't reverse the cuts that the sequester will make alone. He will need the Congress to do that.
And you can bet that if the sequester kicks in and cuts defense by another $600 bn, the Congress - both Democrats and Republicans - will be fighting like two alpha male cats in a bag to KEEP those defense cuts, even if it means gutting the military (as it does). Your blog post, Mr Levin, has already stated that neither rank-and-file Republicans nor Congressional GOP leadership is willing to do anything about these defense cuts. But the Dems have ALREADY promised to fight back ANY attempts to roll back ANY defense cuts.
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Last, but certainly not least, if the sequester is triggered, defense cuts will have to be planned immediately and will be, in many cases, irreversible. The DOD, unlike political parties and the Congress, operates on the basis of LONG-TERM plans, so any decisions - budgetary, programmatic, or related to force structure or personnel - have to be, and are, decided and planned several years in advance. Thus, if the sequester kicks in in FY2013, the DOD will have to close dozens of programs, cancel contracts with defense companies, and pink-slip hundreds of thousands of troops in early 2012. It will, of course, incur penalties for cancelling contracts. And once you close a vehicle production plant or a shipyard, you can't rebuild it. It will stay closed forever. Once it's gone, it's gone. It will not be available when you'll again be ready to buy vehicles or ships.
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The bottom line is that the sequester will do huge, and in most cases, IRREVERSIBLE damage to America's defense, one which a future President and a future Congress - even if they are sympathetic to defense - will not be able to reverse.
Reply to this commentLinkReport Abuse"A lot of Republicans are telling themselves not to worry about the defense cuts because they’ll be undone before they take effect"
And they are wrong, for the reasons outlined below.
"if the next president values defense spending more highly, he could work out changes to the sequester with the next congress at any time."
WRONG. Firstly, the sequester will kick in at the beginning of FY2013, i.e. on Oct. 1st, 2012, LONG before the next Congress and the next President will be seated. Secondly, currently Obama is more likely than not to win reelection. Republicans currently switch from one champion in shooting himself in the foot to another - Bachmann, Perry, Cain, Gingrich - instead of nominating an electable candidate. If they nominate an electable candidate, I may change that opinion. Thirdly, regardless of who will be the next President, he can't reverse the cuts that the sequester will make alone. He will need the Congress to do that.
And you can bet that if the sequester kicks in and cuts defense by another $600 bn, the Congress - both Democrats and Republicans - will be fighting like two alpha male cats in a bag to KEEP those defense cuts, even if it means gutting the military (as it does). Your blog post, Mr Levin, has already stated that neither rank-and-file Republicans nor Congressional GOP leadership is willing to do anything about these defense cuts. But the Dems have ALREADY promised to fight back ANY attempts to roll back ANY defense cuts.
External Link
Last, but certainly not least, if the sequester is triggered, defense cuts will have to be planned immediately and will be, in many cases, irreversible. The DOD, unlike political parties and the Congress, operates on the basis of LONG-TERM plans, so any decisions - budgetary, programmatic, or related to force structure or personnel - have to be, and are, decided and planned several years in advance. Thus, if the sequester kicks in in FY2013, the DOD will have to close dozens of programs, cancel contracts with defense companies, and pink-slip hundreds of thousands of troops in early 2012. It will, of course, incur penalties for cancelling contracts. And once you close a vehicle production plant or a shipyard, you can't rebuild it. It will stay closed forever. Once it's gone, it's gone. It will not be available when you'll again be ready to buy vehicles or ships.
External Link
The bottom line is that the sequester will do huge, and in most cases, IRREVERSIBLE damage to America's defense, one which a future President and a future Congress - even if they are sympathetic to defense - will not be able to reverse.
Reply to this commentLinkReport Abuse