Sequestration, detailed

Though it didn’t get much attention, Democrats on the House Committee on Appropriations recently released a report on the effects of sequestration (pdf) and efforts to mitigate its impact. The report is a comprehensive look at sequestration cuts specific to the following areas: public safety, health, education and science, national security, judiciary and legal representation, commerce, housing, seniors, and foreign assistance. Some highlights in the report on the impacts of sequestration:

  • NIH funding for research is cut by more than $1.5 billion, which the report estimates eliminates more than 20,000 jobs at universities, labs, and other research institutions.
  • Funding for the Center for Disease Control and Prevention is cut by $285 million due to sequestration, inhibiting the CDC’s ability to—among other things—facilitate immunization, combat disease outbreaks, and manage and prevent both chronic and infectious diseases.
  • The National Science Foundation loses $365 million due to sequestration, resulting in approximately 1,000 fewer research grants.

  • National parks, forests, wildlife refuges, and public land units will be forced to reduce hours and cut services due to sequestration. The National Park Service alone will leave more than 900 permanent positions unfilled and hire 1,000 fewer seasonal workers this year.
  • The Department of Housing and Urban Development will be unable to renew approximately 125,000 Section 8 vouchers this year due to sequestration cuts. Additionally, participants in this program will have longer waiting lists and increased rent payments, and landlords can expect to see lower rent payments and more vacant units.

The report also highlights some of the mitigation strategies used to minimize impacts; for example, congressional action on both FAA operations and meat and poultry inspectors. The report concludes that even though congressional action did diminish some of the immediate negative effects of sequestration, in the long-term these programs will still be impacted since sequestration cuts were merely replaced with other cuts. For example, cuts affecting air traffic controllers were replaced by funding coming from the Airport Improvement Program; in the future that program will have less funding to upgrade and improve airport infrastructure—key in longer-term efforts to ensure more efficient operations, ease congestion, and minimize delays. Furthermore, mitigation efforts such as this one are undesirable in that they not only allow for some interests to be boosted above others (not surprising that similar efforts were not made to spare Head Start or low-income housing), but they also sap the political will for the undoing of bad policy since privileged people now, for the most part, can escape the downsides.

Sequestration is terrible policy that is derailing our recovery—there is absolutely nothing redeeming about it. The $85 billion in spending cuts for FY2013 will impede growth, cost jobs, and as demonstrated above, harm programs and the people that depend on them. It should be reversed immediately and without political fanfare or quibbling on how to “pay for” cancellation. This is particularly true now that the Congressional Budget Office has updated their budgetary estimates in a report this week  (pdf) showing that the deficit estimate for FY2013 is about $200 billion less than they estimated it to be just two months ago, in February. Deficit estimates dropped, CBO states in the report, mostly due to higher than expected revenues and an increase in payments from Fannie Mae and Freddie Mac. (Revenue increased due to the expiration of the payroll tax holiday, higher tax rates on personal income above certain thresholds, personal income gains, as well as the realization of more income by high-income taxpayers late in 2012, in anticipation of changes to tax law).

Sequestration is harmful policy that was never a good idea. Its impacts on communities and the larger economy are beginning to sink in. It should be cancelled—and since Congress cannot/will not come to an agreement on how to replace the cuts, it should be cancelled without a pay-for. If anything, the new CBO report showing even smaller deficits in the years to come should accompany a renewed effort to reverse this terrible fiscal framework.


  • http://www.facebook.com/david.brittelli David Ross Brittelli

    $85 billion in spending cuts for FY2013 ? That’s less than the estimated amount of Mediare and Medicaid fraud (Rand Corporation – 2011).