March 17, 2014

WHITE HOUSE CALLS FOR SEQUESTER DELAY

By ExchangeMonitor

With the across-the-board funding cuts known as sequestration set to go into effect in less than a month, President Barack Obama called on lawmakers yesterday to approve a package of smaller cuts to push back the implementation of sequestration and provide time to reach a final solution on deficit reduction. In remarks at the White House, Obama warned of the negative impacts sequestration is expected to have on the U.S. economy. “Deep, indiscriminate cuts to things like education and training, energy and national security will cost us jobs, and it will slow down our recovery. It’s not the right thing to do for the economy; it’s not the right thing for folks who are out there still looking for work,” he said. “Congress is already working towards a budget that would permanently replace the sequester. At the very least, we should give them the chance to come up with this budget instead of making indiscriminate cuts now that will cost us jobs and significantly slow down our recovery.”

The sequestration process is set to involve a total of $1.2 trillion in funding cuts, equally divided between defense and non-defense funding, over 10 years unless similar deficit reduction legislation is approved. For DOE’s Office of Environmental Management, sequestration would entail a 7.3 percent cut for defense environmental cleanup funding and cuts of 5.1 percent to non-defense environmental cleanup funding and uranium enrichment D&D funding. For the National Nuclear Security Administration, sequestration is set to entail a cut of approximately 7.3 percent. The cuts were set to go into effect on Jan. 2, but lawmakers pushed it back by two months, to March 1, unless further action is taken.

Obama did not specify in his remarks yesterday what kinds of spending cuts or tax reforms he believes should be part of any effort to delay the sequester. He did note, though, that “the balanced approach of spending cuts and entitlement reform and tax reform” proposed to House Republicans last year is “still on the table.” Obama said, “I’ve offered sensible reforms to Medicare and other entitlements, and my health care proposals achieve the same amount of savings by the beginning of the next decade as the reforms that have been proposed by the bipartisan Bowles-Simpson fiscal commission. … But in order to achieve the full $4 trillion in deficit reductions that is the stated goal of economists and our elected leaders, these modest reforms in our social insurance programs have to go hand-in-hand with a process of tax reform, so that the wealthiest individuals and corporations can’t take advantage of loopholes and deductions that aren’t available to most Americans.”

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