I thought we averted the sequester!
We wish. A temporary fix was put in place on Jan. 1st; it moved the date of the Budget Sequestration from Jan. 1st to March 1st, at which point $85.3 billion will be automatically trimmed from the federal government’s 2013 budget unless Congress acts to avert the bill. The country runs out of money on March 27th and hits the debt ceiling in May, at which point it would start defaulting on its loans.
So what does the sequester affect?
Sequester takes a hack-saw to the budget, cutting $1.2 trillion from the budget through 2021. The spending cuts would come from both the Pentagon and non-defense programs. They are designed to be sweeping and crude cuts to motivate politicians into averting them. Social Security, Medicaid, the current wars, and a few poverty programs avoid the knife, however.
Ah! OK, so we've got two weeks? What is Congress doing about it?
Oh, no, they're on a break! The ten-day recess for lawmakers gives them only one week to avert the spending cuts.
Right. So once they're back, what are they planning?
There are currently four major plans: Senate Democrats on Thursday proposed a $110 billion package including spending cuts that would kick in slowly, cutting direct payments to farmers, eliminating some tax loopholes for big corporations, and implementing the Buffett Rule on millionaires. But with no Senate GOP lawmakers likely to support the measure in its balance of spending cuts and tax hikes, the plan is unlikely to survive a filibuster. House Republicans still want to keep the defense budget intact while decimating social service programs like food stamps, but even they admit they don’t have the votes to pass it in the House. House Democrats want to cut farm subsidies, raise taxes, and eliminate deductions for this year, while letting sequester cuts in 2014 and on stand; House Republicans have refused to let this plan past committee. President Obama wants to put together a smaller package of spending cuts and tax reforms to delay the cut for a few more months – essentially what was done three months ago, but with spending cuts tacked on.
Right. OK, but is this sequestration really that bad?
It could put as many as a million jobs at risk, according to the Congressional Budget Office. Sec. of Defense Leon Panetta said the cuts would be "disastrous." The White House notes that we'd see early education slashed and as many as 17,200 teachers and school staff fired. There would be fewer inspections and investigations into food-borne illnesses. 73,000 mentally ill children and adults would lose funding for their treatment. The FBI would have to cut 1,000 agents. Unemployment and food-stamps would be cut. 100,000 homeless people would lose shelter. Border security would lose 5,000 agents; airport security lines would take another hour as there would be fewer staff. The list goes on and on.
Crikey. Any other alternatives?
NBC News’ Chuck Todd hypothesized on Morning Joe that the government may use the 27 days between the date of sequester and when the government runs out of money as a “trial sequester." “Sequester will happen on March 1, then the markets will react negatively, there will be some quick pain and over the 27-day period between sequester on March 1 and the government running out of money on March 27th then maybe you’ll see some action where they ‘fix the sequester,’” Todd added. “It’s why Republicans in the House feel comfortable letting it happen because they know they have 26 days to fix it.”
So what happens on March 27th?
The country essentially shuts down when it cannot pay its employees.