The Potential Impact Of Sequestration
http://thedianerehmshow.org/shows/2013-02-25/potential-impact-sequestration
The U.S. is bracing for steep, across-the-board cuts in the federal budget. If implemented, they could mean furloughs at the Pentagon, longer airport security lines and delays in food inspection. Diane and her guests discuss the potential impact of sequestration.
Guests
Jared Bernstein
senior fellow at the Center on Budget and Policy Priorities, and former chief economist and economic policy adviser for Vice President Joe Biden.
David Wessel
economics editor for The Wall Street Journal and author of "Red Ink: Inside the High-Stakes Politics of the Federal Budget."
Mackenzie Eaglen
research fellow at the American Enterprise Institute’s Marilyn Ware Center for Security Studies.
Susan Davis
chief congressional reporter for USA Today.
Comments
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wish we could wave a magic wand and have 1/2 of all the money and resources that go towards military and defense be abruptly diverted to renewable energies solar and wind research and installation win win win situation
I have no faith in congress or the president to act in a sane matter. How I would like to stand before them and quote Oliver Cromwell talking to the rump parliment:
“I bid you, go! You have sat too long here for any good you have done lately. Depart, I say; and let us have done with you. In the name of God – go!”
I am sure a good many Americans feel this way.
You would just punish the few good ones. The bad ones are not afraid of salary cuts or term limits because their reward comes after they leave public office.
will the sequester effect the salaries of congress. it should!
If you cut their salaries to zero, it would be the Tom DeLays of this world who would be the most happy.
When a couple going through a divorce can't agree on terms a judge, arbitrator or some other impartial 3rd party comes in and tells them how it is. What our problem is we don't have an impartial 3rd party. Both sides have a bias and are trying to spin the issue their way. Both need to pull their heads out of their rear ends. Obama won 52-48%. Not all Americans agree with EITHER side and both sides need to remember that.
A factor that most Republicans apparently fail to comprehend is the Multiplier Effect of government spending. For every dollar government spends in the American economy, there is generally a significantly greater return. The converse also holds true. When government spending is cut back, the impact on the economy is also multiplied. Cutting the income of middle class people has a drastic impact as the vast amount of middle class income is quickly spent on food, services, bills and other goods.
The sequester will have a much greater than 7% negative effect on the economy because of this.
As a retired individual, I own stocks that I will most likely sell as sequestration takes place because I see restricted spending on dining out and purchasing clothing etc. Do your reporters agree?
I think it's time to do away with congress. Clearly they are unwilling or incapable to doing what is right for our country. As a lifelong republican, i will never again support the gop or any republican cause. The damage to our country and financial systems caused by the gop is unexcusible and unforgiveable.
My local congressman, steve sutherland, is yet another unflexible gop lacky. Calls and emails only result in canned gop narrated responses. What a shame.
Continuing the do nothing course established by 'our so called leaders' will likely move this country toward a revolution similar to 1930s germany. Right now, i'm in favor for a strong leader and no congress.
I think the President should work with the lawmakers to cut entitlements; and the first entitlements affected should be the FULL pension and healthcare that the senate and congress receive regardless of the time served. They should have the pensions limited in the same way that the rest of us do. Gee, when I think about it, most of us do not even get pensions any longer, why do the lawmakers?
With respect to the many defense contractors in Northern Virginia, it is the small businesses that are suffering the most, since the large prime contractors have stopped spending given all the budget uncertainty. Many small businesses are laying off in droves or otherwise trying to hang on as a result.
America is doomed, -- the patients are running the asylum, -- mentally compromised by a contaminated environment, engineered food, playing over-caffeinated predatory hierarchical games in a world of abundance. It's no wonder they can't make rational decisions, while choking on their love of NASCAR, Anti-Science, SUV's gas pigs, MacMansions and CO2 stupidity.
They never learned the lessons of the Great Depression, thus can't understand history, when they tried austerity and it was a huge failure. God didn't bless America, if you believe it that hooey.
Hope lost.
It's been pointed out that Obama does not govern, he campaigns. He effectively removes himself from a leadership position by campaigning against the opposition from the outside. By doing this he is seen as fighting against those that he describes as enemies of the people. He sets up strawman arguments about fair share, woman's rights, gay rights, minority rights etc etc. He deliberately diverts attention away of the looming disaster of out of control federal government spending for a larger goal, centralized federal government control over every aspect of our lives.
I agree with Phi Davis' comment! This Congress is an embarrassment to democracies everywhere. If sequestration goes into effect, they should all resign.
The the root of our current mess is that our government continues to be held hostage by a small group of fundamentalists who belong to the Church of Shrinking the Government. The vast majority of Americans want us to move the budget towards balance. This is the mainstream view. To do so, we should be focussing on long-term adjustments that increase the revenue stream and adjust Medicare/Medicaid to bring it into a fundable range. This is a 25-year proposition, not a short-term knee-jerk slashing of discretionary spending.
In fact, discretionary spending is the one thing that should NOT be cut first, since it represents investments that bring a good return in the long run. The only part I like about the sequester is that it cuts defense. Everybody knows that this needs to happen, but the politics make it impossible to get legislated any other way.
If the sequestration comes to pass, what can we in our communities do to help ourselves and our neighbors to weather it together?
At the end...there goes Ms.Eaglan with the fear mongering American Enterprise Institute talking points over and over
Jim K wrote:
"I have no faith in congress or the president to act in a sane matter. How I would like to stand before them and quote Oliver Cromwell talking to the rump parliment:
'I bid you, go! You have sat too long here for any good you have done lately. Depart, I say; and let us have done with you. In the name of God – go!'
I am sure a good many Americans feel this way."
Wow! Just wanted to re-post that one. I love it. Do you have one of those bumper stickers that says "Politicians Not Listening THROW THEM OUT!"?
"In the name of God - go!"
Do you have a source for that?
Phil Davis wrote: " Right now, i'm in favor for a strong leader and no congress."
Obama appreciates your support. You are the desired results of his efforts.
@biltmore: Don't call AEI "fear mongering." They're a genuine think tank, comparable to Brookings.
I would not object to you using such terms about Heritage or Urban.
Congress should not collect paychecks nor should they be allowed to leave the building until this is settled. Rich men and women, who have no idea what it's like to go without, can't possibly understand what an impact this sequester will have on the American People.
We, the People, need to remember these jerks when it comes time to vote and get them all out of office. I was going to say so they could feel the pain, but they have enough money and benefits now that they wouldn't feel a thing. We need to stop entitlements for those that are governing us. They don't deserve it. Shame on you all.
Why are we not discussing the disastrous effects of preventing the sequestration budget cuts?
Table S-1 of President’s Obama’s Budget for Fiscal Year 2013 [FN1] details the disastrous path the nation is on.
Take the current fiscal year, Fiscal Year 2013 (FY13).
• In FY13 the federal government estimates net expenditures at $3,803B
• In FY13 net receipts from all tax sources are estimated at $2,902B
• Thus, FY13’s one-year deficit is $901 billion.
The impending sequestration budget cuts reduce the FY13 one-year deficit by less than $90B.
That means, with sequestration, in FY13 alone we spend $810B more than the nation collects in all forms of taxes.
In FY 14, we overspend by $668 billion, in FY15 $610 billion, in FY16 $649 billion. By FY2022 we still do not have balanced budget, and are still over spending by $704B!
As of February 21, 2013, the national debt was over s$16,608B, over five times the income from all forms of taxes, estimated at $2,902B.
In FY2022, President Obama estimates the national debt to be $19,486. That year, all forms of taxes are estimated to bring in $5,115B.
Based on these numbers, we do not need to reduce spending by 10%.
We need to reduce spending by 23% just to balance the budget and not incur MORE debt.
If we wanted to eliminate the national debt in 30 years, we would have to cut spending by nearly 40%.
If the United States does not stop this out-of-control spending, we are doomed to a national economy like that of Greece and Zimbabwe.
FN1: See page 205, at http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/b...
FN2: http://www.treasurydirect.gov/NP/BPDLogin?application=np
KeithBrown wrote: great stuff!
Thanks for your input!
Reading the other comments, it seems as if the Democrats blame the Republicans and the TEA Party, the Republicans blame the Democrats, the liberals blame conservatives, and conservatives blame liberals.
The fact is no matter which political party you support or which side of the political spectrum you are on, ALL of the people of the United States of America are ill served by those in elected office (i.e., every member of Congress, the President, and Vice-President) and the media.
Yes, budget documents are a PITA and boring to read, but someone, somewhere needs to explain what they say about our nation's future.
Then EVERYONE, liberal and conservative alike, Republicans, Democrats, TEAs, Greens, Libertarians, and Independents should begin DEMANDING Congress and the President find a course to fiscal sanity, and if they are unable or unwilling to do so, we should VOTE EVERY DAMN ONE OF THEM OUT!
So many people are inviting the Sequester regardless of the consequences. I doubt the “Private Enterprise” savior will step up and help the millions searching for work. Perhaps they will just blame the President for the resulting economic woes?
fingerpicker8 wrote:
"A factor that most Republicans apparently fail to comprehend is the Multiplier Effect of government spending. For every dollar government spends in the American economy, there is generally a significantly greater return. The converse also holds true. When government spending is cut back, the impact on the economy is also multiplied."
NO! FALSE! UNTRUE! (a lie?)
At the very least deceptive or simply ignorant.
Listen, and listen carefully. This is the most important fact that you will ever read on this board related to politics and the economy.
GOVERNMENT SPENDING DOES NOT CREATE WEALTH. PRIVATE SECTOR SPENDING DOES.
The dollar that you talk about spent in the economy COMES FROM SOMEWHERE. It does not come off the money tree. It comes out of the pockets of taxpayers either in the form of taxes, debt, or inflationary monetary policy (read: printing press).
That same dollar, returned to the taxpayer to spend in the economy or to invest in small business or the stock markets has far more positive economic impact.
GOVERNMENTS DO NOT CREATE WEALTH. Outside of the necessary spending for infrastructure and keeping its citizens safe, government spending sucks the lifeblood out of the economy like a leech.
@ the Last Moderate..Sorry I am going to disagree looking at the list of conservative names associated with it..I am going to lump it with all the other Right wing organizations
@keithBrown..that is exactly why the divide exists I feel conservatives would prefer Grandma lose benefits, schools lose teachers, cities lose police personnel and unemployed lose benefits so they can build more aircraft carriers or stealth fighters the divide is great
Constitutional ignorance