Tuesday, February 26, 2013

#Sequestration and all the things it does not accomplish

It appears that sequestration will happen. Our politicians have made the decision to test the markets and the voters, and simply walk away. Serious negotiations should have concluded a year ago, but were swept under the rug by electioneering on both sides.

Obviously, the agencies are working very hard to take make headlines of these cuts. Cancelled carrier deployment, long lines at airports... let the drama begin. One might think that responsible administrators would try to work with the cuts and minimize ill effects, but no! This is the theater of the day.

Because sequestration will not occur within the context of an overarching fiscal plan, the cuts are disruptive by design- i.e. there is no strategy to mitigate ill effects. Moreover, the ten year program of cuts can be stopped or even reversed at any moment, so there is no real commitment to rein in spending. Sequestration is not a real strategy to cut government spending; it's designed to be a political scare tactic and nothing more.

The cuts that really need to happen will not happen. Sequestration will not dial down production of hyper-expensive fighters; it won't reduce agricultural subsidies; it won't take one tentative bite out of the fat at the Department of Education and other agencies that have run off the rails for decades; it won't fight the rising cost of health care; and it certainly won't set our entitlement spending on a sustainable path. 

Sequestration is not some principled Coolidge-era shift of economy from public to private; there's nothing being shifted at all and there is no strategy on either side to accomplish that. Instead we'll have just small, disruptive cuts designed for partisan headlines. And those cuts truly add up to peanuts in terms of total federal spending.

Imperfect though it may be, the Simpson-Bowles plan has been on the table for years and could easily lead us out of this silliness, with responsible cuts of significant magnitude.

I guess I just have to hope that the next election is as anti-incumbent as I dream.

P.S. This informative blog post by Rick Newman shows, in good detail, what sequestration does and does not do:

Rick Newman / US News & World Report : Charts reveal likely sequestration effects

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