Do you hear that rumbling? That’s the sound of the next manufactured “fiscal crisis” from Washington, D.C. and it will start rising to crescendo over the next three weeks. You will soon hate the word “sequestration.”
“Under sequestration, an amount of money equal to the difference between the cap set in the Budget Resolution and the amount actually appropriated is ‘sequestered’ by the Treasury and not handed over to the agencies to which it was originally appropriated by Congress. In theory, every agency has the same percentage of its appropriation withheld in order to take back the excessive spending on an ‘across the board’ basis. However, Congress has chosen to exempt certain very large programs from the sequestration process (for example, Social Security and certain parts of the Defense budget), and the number of exempted programs has tended to increase over time — which means that sequestration would have to take back gigantic shares of the budgets of the remaining programs.”
And as Charlie Brennan reported in the Feb. 10 Daily Camera, Boulder is poised to take a massive economic hit if Congress and President Obama can’t come together to prevent sequestration. Brennan focused on cuts that would affect Rocky Mountain National Park, but also noted that the city is heavily dependent on federal money that supports its peerless scientific labs. To boot, because only a paltry 4.6 percent of its funding comes from state government, the University of Colorado Boulder leans more heavily on federal funding than many universities.
As Johnson explains above, politically protected programs like “defense” and Social Security would probably come out OK. Which means that everything else would take deeper cuts. Boulder could be headed for a budget apocalypse.
(Aside: Isn’t it curious that Republicans who insist government spending doesn’t create jobs freak out at the prospect of lost military jobs?)
I have friends who would revel in such a result. After all, they say, we’re only talking about “dead wood” bureaucrats, people who need a slap in the face and who will, in time, take their rightful place in the private sector. Perhaps as Walmart greeters, but hey, it’s a job.
The schadenfreude — German for taking pleasure in another’s misfortune — some Americans seem to feel about their fellows is not just distasteful, but also short-sighted. Whether you own a yogurt shop or a motorcycle dealership, you are a Realtor or a massage therapist, all those newly unemployed people won’t be spending as much on your business. You are going to suffer, too, if the sequestration bomb hits Boulder. (Believe me, state and local government officials are taking this threat very seriously.)
We hear from some quarters that refusing to raise the debt ceiling is smart policy, that it will force a much-needed reduction in the size of government.
But here’s another way to look at it: We’re all scofflaws. The debt is high due to money we borrowed to buy the “stuff” we Americans wanted — or didn’t.
The current national debt has reached an astounding $14 trillion. Here are the biggest contributors, according to figures collated by The New York Times from the Congressional Budget Office in 2012:
The Bush-era tax cuts: $1.8 trillion.
Iraq-Afghanistan wars and new military spending: $1.4 trillion.
Bush-era stimulus and TARP bailout: $997 billion.
Obama-era stimulus spending: $711 billion.
Bush-era non-defense spending: $608 billion.
Obama-era stimulus tax cuts (yes, Virginia…): $425 billion.
Bush-era Medicare Part D: $180 billion.
Obama-era health reform: $152 billion.
That doesn’t include the massive influence of the recession(s), which vastly reduced tax revenue.
With the possible exception of some true-blue libertarian-types, most of us probably supported some of that spending and opposed some. But guess what? It’s our debt. Not the government’s. Yours. Mine. And now we have to pay for it.
We can try to do that through draconian cuts to non-defense discretionary programs such as social services and scientific research. Problem is, we can’t get there from here, since such spending represents only a thin 15 percent of the federal budget (compared to about 20 percent for military/defense, 70 percent combined for Social Security, Medicare and Medicaid and about 5 percent for interest).
Under the rule of schadenfreude, we may think it better to have somebody else lose his or her job, especially a “lazy bureaucrat.” But I’ve worked in the private sector, the nonprofit world and more recently, in a public role, and guess what? There are lazy, incompetent people in all three, but most are hard working and honest.
We could share the load and pay higher taxes for the stuff we bought. That, too, has an impact, since every dollar of taxes won’t be spent, saved, invested or given to charity. But it’s far more equitable. Fat chance.
Endlessly putting off hard choices is not a sound approach. But there is a strong argument that now is not the time to drop the austerity axe; just ask Ireland or Britain. And if sequestration hits, we’re all going to pay anyway.