Analysis

After the sequester: Why March 27 is even scarier

capitol dome and bills

It's almost certain that sequestration will take effect on March 1, as Congress and the Obama Administration have almost no time left to  reach a deal to prevent it. But less than a month later, the government could shut down altogether if lawmakers can't agree to extend the continuing resolution now funding its operations. (Stock image)

The debate over government spending is shifting from across-the-board cutbacks in agencies to a more sweeping focus on all federal accounts. With a March 27 deadline to extend a vital continuing resolution and prevent a shutdown of all operations, President Obama and Congress—who have tied themselves in knots in budget debates—face the challenge of finding new steps to loosen the policy stranglehold.

The latest challenge was put in place last September when both parties, on the eve of the election, agreed to kick the spending can down the road and retain existing levels for another six months. With the lawmakers’ continuing failure to resolve the fiscal issues, and with the voters’ decision to retain roughly the political status quo, the same decisions again are front and center. But this time, the players have shown that they are less amenable to deal-making.

Since January, leaders in both parties have been struggling over steps to avoid more than $80 billion in spending cuts and their consequences from the budget sequester that was scheduled to hit Pentagon and domestic discretionary accounts on March 1.

The sequester appears increasingly likely to go into effect. But the omnibus spending bill poses an even larger threat for already distressed federal employees and contractors. Instead of furloughs and spending delays, they may have to contend with a shutdown—and uncertain prospects for how and when the funding cutoff eventually will be restored.

The steps to resolve the latest conflict seem clear. Leaders of the congressional appropriations committee—who have a long tradition of bipartisan cooperation—could craft a compromise on overall spending for the next six months. Such a step also offers the convenient opportunity of relaxing the sequester, where the debate between the White House and congressional leaders had bogged down on political talking points.

House Appropriations Committee chairman Hal Rogers (R-Ky.) and Senate Appropriations Committee chairman Barbara Mikulski (D-Md.) offered good intentions and constructive proposals. "I am hoping that Congressman Rogers can pass this [spending extension] and that the Senate can get to work on it," Mikulski told reporters in late February. But it was far from clear that the once-powerful appropriators had the leverage or the clout to make a deal.

Only a couple months ago, the spending panels contended with unexpected obstacles before they finally passed a nearly $60 billion emergency spending bill for the victims of Hurricane Sandy, which caused huge devastation in the Northeast last October. But 179 House Republicans and 36 Senate Republicans voted against that measure—dramatic signs of the GOP’s aversion to once-routine spending, and the breakdown of the appropriators’ consensus-building approach.

Unique circumstances, in hindsight, led to last September’s controversy-free six-month approval of a continuing resolution for all spending. Neither party wanted another embarrassing showdown on the eve of the presidential election. So, they were willing to retain the spending levels that had been set in the August 2011 agreement to raise the federal debt ceiling.

Most Republicans went along last fall because they were hopeful that the election results would give them control of the presidency and strengthen their numbers in Congress. Despite opposition from conservative lobbying groups, conservative lawmakers pledged to support a short-term truce and were mostly silent during the routine debate.

But the dynamics of the spending debate have changed radically. Republicans failed to score their expected election gains. Congress and Obama averted the "fiscal cliff" with a New Year’s Eve deal that included mostly tax hikes. And, with the spending sequester scheduled to take effect, the $1.043 trillion baseline in effect has been reduced by tens of billions of dollars with an approach that most sides agree is irrational.

The timetable is short, not least because Congress is scheduled to start a two-week Easter recess on March 22. And, with Obama and congressional Democrats turning their attention to other domestic and overseas issues, there seems scant basis for optimism that wise heads will prevail on the spending showdown.

About the Author

Richard E. Cohen, an FCW contributing writer, has covered Capitol HIll for more than three decades and is the author of several books on Congress.

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Reader comments

Fri, Mar 1, 2013 TIRED PA

My Govt takes in under 2 Trillion dollars in taxes and revenue each year. My Govt spends over 3.6 trillion each year. Unsustainable. My Govt CANNOT pay back what it currently owes (16.5 Trillion dollars). My Govt CANNOT even make payment on just the INTEREST owed each year. My Govt borrows even more money to pay the interest on what is owed, yet doesn't even pay down on the actual principal. So now that there is finally a financial crisis painted over to look like a political crisis, maybe someone somewhere will actually look at the budget, oh wait, we haven't had a budget in 4 years, well maybe look at how our money is spent and STOP spending more than we make. I'm just plain TIRED of hearing about it because Washington is addicted on spending the tax payers money and money that doesn't even exit too. That keeps them ALL in office. This will get kicked down the road farther and farther because no one wants to fix the problem because fixing the problem isn't politically correct and would be political suicide for whomever would attempt to fix the spending problem. We will just write off the debt later. 401Ks, Treasury Bonds, and similar investment instuments will be worthless for several decades, but that will have to happen some day unless someone has about 16 Trillion dollars to spare Uncle Sam.

Wed, Feb 27, 2013

Isn't time the American people become outrage and demand practical, verifiable and performance based outcomes from the Republican party? There have been no new ideas from this paty in more than fifthy years, all we get is gridlock , criticism of the proposed solutions put forth by the President and his Cabinet, and the Demorcratic Party. In my memory, including 21 yrs active duty in the USAF and 8 yrs as a civil servant, each year, there are problems getting a signed Budget on time to allow continuance of all government operations. Pass the word to all who care, vote them all out of office for not performing to the Employers' Standards... The American People deserve better than this and now is the time to become outrage to get what we expect from Washington DC. The Wall Street bankers and stock traders are still dealing in stock/bond derivatives with no risk of their own monies continue to rake enormous profits at taxpayers expense & yet we can't have a budget? I recommend a daily minimal percentage tax charge on all who trade daily to help with our ecomomic woes. Tell your representatives about it, please.

Wed, Feb 27, 2013

The statement that, "The debate between the White House and Congressional leadeers bogged down on polictial talking points" is quite an oversimplification of the need to return to responsible government. N matter how much it hurts, we cannot continue to spend trillions of dollars we don't have and can't afford to repay. We are well down the path to an end which will make the riots in the streets of Greece look like a party. No matter what anyone tells us, or how much want it to be different, it is impossible to continue to ignore our mounting government debt. Any action other than getting our fiscal house in order, will end our ability to turn to investors to lend us trillions of dollars to cover our irresponsibility. We have been able to continue to print and borrow money only becuase the U.S. dollar was a releatively stable currency backed by one of the strongest economies in the world. Those conditions no longer exist and the ability to print as much money as we want to spend has come to an end. Only the uninformed and foolish believe we can balance our budget on the backs of the "rich". They don't make enough! Even at a 100% tax rate on the "rich" we will continue to have budget shortfalls that make Greece look like a good investment. There is no option. we are going to have to get serious about cutting our spending. Unless every one of us is willing to pay an additional 15% (+) in Federal income tax, we won't be able to balance the budget and many of our state economies aren't any better. We continue to vote for people who tell us what we want to hear, rather than face the fact we are all going to suffer for the continuing irresponsibility demonstrated by our elected representatives. WE made this mess and no one is going to bail us out. It's not a matter of talking points or politics. It's about being fiscally responsible!

Tue, Feb 26, 2013 los angeles

What is money? These politicians are no different than the Wall Streeters who hustle credit default swaps. They are just trying to hustle the default of the country playing with the numbers. Money is the value of work, when Feds print more, it just devalues work. The economic system is finite and rational, you either have the money or not. When you don't have the money, you have to be thrifty and cut discretionary spending... like foreign aid and recreation. Greece, Italy, Spain, France... nobody likes austerity so they riot. Only in the US does the president (community organizer) get out there to rally the public to riot over austerity. In reality the president is the CEO manager and can decide priorities, just like his executive orders to not deport or defend DOMA. He choses not to decide because he is exactly the nice guy that everyone voted for. To not decide is to decide.

Tue, Feb 26, 2013

Congress Cancel your Easter Recess. God won't mind if you work hard and do your job. It is time for a 24/7/365 attention to the FY13 budget. Don't forget that the FY14 budget is due to be complete before 30 September 2013. Your Constituents!

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