How Not to Replace the Sequester

by Ramesh Ponnuru

As you probably know, the deal to raise the debt ceiling in 2011 included cuts to planned spending that are supposed to begin this year: the sequester. A number of Republicans concerned about the impact of the sequester on the defense budget have proposed stopping the first year of cuts and instead saving the same amount of money by reducing the federal workforce over the next ten years. Sen. Kelly Ayotte (R., N.H.) and House Armed Services Committee chairman Buck McKeon (R., Calif.) are leading the charge.

When I first heard about this idea, it sounded like a good one to me. I’m in favor of cutting federal spending. Neither the workforce reductions nor across-the-board cuts seem like the wisest way to go about it. The sequester cuts seemed like a worse idea, though, because of the across-the-board cuts to defense. (I am very open to the possibility that a more deliberate plan for defense cuts would make sense.)

I spoke to a Republican senator the other day, though, and he changed my mind. He argued that this proposal would end up making the sequester the equivalent of Medicare’s “sustainable growth rate”: a spending cap that Congress constantly waives. Congress would have replaced a year of definite spending cuts with a promise of cuts over a decade, with most of the savings coming in the later years when the cuts would be least likely to materialize.

He argues that instead the Department of Defense, and maybe domestic agencies as well, should be given latitude to cut spending where they think best for the next year and that Congress should budget to hit the targets after that. (Budgeting: Now there’s an idea.) Or if the Democrats agreed, Congress could cut entitlements, starting now, to soften the across-the-board cuts.

His main point is that the spending cuts should go forward. During the fiscal-cliff debate, he points out, Obama had the prospect of automatic tax increases going for him. This time, Republicans have automatic spending cuts on the way. They shouldn’t give up a policy victory, even if an imperfect one; instead they should work to make it a bigger victory.