The across the board government spending cuts go into effect three weeks from Friday. This week President Barack Obama proposed a short term mix of spending cuts and tax increases to delay the sequester, but Republicans on Capitol Hill called it dead on arrival.
Alaska’s congressional delegation is not predicting any action, and that inaction is creating uncertainty in the economy.
The president and Congressional leaders designed the sequester to be so heinous that virtually nobody would let it go into effect. But after a year and a half of posturing, Congress appears ready to do just that.
Here’s Republican Paul Ryan speaking on a recent episode of Meet the Press.
“I think the sequester is going to happen because that $1.2 trillion in spending cuts – we can’t lose those spending cuts,” Ryan said.
If nothing happens by March 1, government agencies will start furloughing people, scaling back operations, and perhaps most worrisome, stop contributing so much money into the economy.
A scale back in military spending led to a contraction in the economy last quarter.
And yet there is no public movement on any comprehensive deficit reduction plan to cancel the sequester, nor is there any small measure in Congress to delay the cuts yet again.
Senator Lisa Murkowski says she expects the cuts to happen. And has some motherly advice for her colleagues.
“When my boys were young and they were easily distracted by something, every now and again I would just take their face in my hands, and look them in the eye and say, ‘You need to focus.’ That’s what this Congress needs to be doing right now,” Murkowski said.
Senator Murkowski says she’s frustrated by Congress’s apparent need to concentrate on gun control and immigration, seemingly in lieu of a debt deal.
She blames Congressional leaders. While Democratic Majority Leader Harry Reid and Republican Minority Leader Mitch McConnell publicly tussle, she says rank and file members are trying to negotiate.
And she says every Alaskan who comes into her office – from teachers and principals, to government contractors to health care workers – asks whether the cuts are going to happen.
“And at the end of the day, you’re messing with people’s lives. What do they do? How do they plan? Do we move forward with this project? Do we need to hire more? Do we need to fire more? We are not helping,” Murkowski said.
Complicating the budget debate is the timing.
The fiscal year began Oct. 1 last year without a budget. Since then a continuing resolution has been keeping the government operating at last year’s level. That’s set to expire March 27.
Senator Mark Begich worries that the sequester will go into effect, and then Congress won’t be able to write a budget for the rest of the fiscal year.
“Worst case scenario we get to March first and the cuts go into play, everyone is scampering around, and we get to the continuing resolution at the end of the month, and we just continue the resolution until the end of the fiscal year, and tell appropriators work on next year’s budget,” Begich said.
Both he and Senator Murkowski sit on the Appropriations Committee. Senator Begich says leaders of that committee – both in the House and Senate – have been working on a measure to fund the government from the end of March through September.
Regardless, he says future budgets, by law, need to be smaller.
“Any department, agency, office that has not been thinking about this already … it would have been a mistake. With or without sequester, we’re going to have a tough budget over the next couple of years. And we have to buckle in and tighten up and look at each department very carefully,” Begich said.
But if nothing happens by March first – that careful cutting won’t be an option.
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