WASHINGTON — Don’t be too frightened by the doomsday talk about the automatic spending cuts that look more and more likely to kick in.
There would be pain, to be sure, with some federal workers taking unpaid furloughs, some programs cut and as many as 700,000 jobs nationwide left uncreated.
But programs that touch millions who rely on government checks most, including Social Security recipients and the poor, will not be affected. For the rest, the impact of cutting $85 billion from federal spending, called a sequester, won’t be felt all at once and in some cases may not kick in for some time. And there may even be escape clauses: If the cuts provoke a huge public outcry, a Congress where most incumbents are seeking re-election next year can undo at least some of the damage.
Averting the sequester
Even the political fallout is hard to calculate. If the economy keeps growing, those lawmakers next year could point to the sequester as a boost. After all, constituents want the nation’s debt reduced, a sizable minority is for proceeding with the cuts, and people are tired of Washington fumbling and delaying efforts to take serious steps.
So despite the White House’s warning that chronic suffering is nigh, the impact will not be universal and depends on the agency, the program and the politics.
“The sequester affects different programs differently," said Sharon Parrott, a vice president at the Center on Budget and Policy Priorities, a budget research group.
Prospects for avoiding the sequestration are dimming. President Barack Obama and congressional Republicans stuck to their guns Saturday, clashing over who will be responsible if automatic federal spending cuts go into effect on Friday.
The impasse probably means the cuts will take effect, and many Republicans have signaled they’re perfectly willing to let that happen.
Questions
What’s coming first, though, is a week of more chilling scenarios and finger-pointing. But assessing the true impact depends on the answers to questions that right now are difficult to resolve with any precision.
Q: How and when will we feel the changes?
A: Macroeconomic Advisers, a St. Louis-based research firm, paints a grim, but not too grim, picture. By the end of next year, it estimates, about 700,000 fewer jobs would have been created than might have been expected.
But, the analysis added, “The macroeconomic impact of the sequestration is not catastrophic."
Big chunks of the budget are exempt, notably Social Security, Medicaid, veterans benefits, the Children’s Health Insurance Program, Pell grants for students, and a host of programs that help the poor. Medicare spending is not subject to the entire reduction.
The cuts, which amount to about 2.4 percent of roughly $3.55 trillion in total federal spending, are focused on a smaller part of the budget. About half come from defense, which would be trimmed about 13 percent, and half from some domestic programs, which would lose 9 percent of funding. There are lots of variables. Some agencies are said to have saved money in recent months, thereby easing the potential impact, and timing of the cuts varies.
Some big education cuts would take effect in the school year beginning this fall, though hiring decisions will be made starting in the spring. Community development and public housing funds would drop, cuts that would be felt throughout the year. Average wait times to get through airport security could go up about 50 percent. On Friday, Transportation Secretary Ray LaHood said the sequester would cause delays of up to 90 minutes at major U.S. airports if it goes into effect.
At the Pentagon, about 800,000 civilian workers face one-day-a week unpaid furloughs for 22 weeks starting in late April.
Federal income tax filers could hurt from the sequester in the form of delayed refunds and long waits for telephone help from the IRS, while tax fraud efforts could be stymied.
Cuts in social benefit programs are likely to start quickly so they don’t hit all at once later in the year. That means reductions in jobless benefits for the long-term unemployed would start next month. A delay would mean bigger cuts in succeeding months.
Q: Can Congress quickly and easily undo any damage?
A: Maybe. All government funding runs out March 27, so lawmakers are working on a massive spending plan to avoid a shutdown, a plan that could restore some cuts.
Congress also could pass other, separate spending bills, called appropriations, that detail where funds should be spent. There’s hope on Capitol Hill that a defense bill will do just that, and some talk that should a program’s cuts cause an outcry, lawmakers could add money in other spending legislation.
None of that will be easy. The sequester presents three challenges to budget writers: It’s abrupt; it fails to deal with the biggest drivers of the debt; and it is indiscriminate, said Marc Goldwein, senior policy director at the nonpartisan Committee for a Responsible Federal Budget.
Q: Will the cuts prod government to be more efficient?
A: The cuts were designed as a politically unpalatable poison pill that would force the government to agree on some better way to curb soaring deficits. With Democrats and Republicans unable to agree on an alternative, Democrats say the looming cuts will wreak havoc, while some analysts say the cuts, even if poorly designed, could force needed austerity in government.
“This will force government executives to find cuts," argued Chris Edwards, director of tax policy studies at the Cato Institute, a libertarian research group.
Republicans tend to agree. “We don’t like sequestration — it’s blunt, it’s ugly, and it just doesn’t work," said Sen. Lisa Murkowski, R-Alaska. “But it does force us to deal with budget cuts. It forces us to deal with a $16.4 trillion debt. It does force prioritization."
Cuts would probably not be confined to 2013. Even if Obama manages to persuade Congress to raise new revenue, he has said he would replace only half of the spending cuts with tax increases, in essence accepting a half-trillion dollars in cuts over 10 years. That would be on top of more than $1 trillion in cuts already enacted by the Budget Control Act, which created the sequester in 2011 as part of a deal to raise the country’s statutory borrowing limit.
Q: Will there be political fallout?
A: This could be the most crucial question, because if lawmakers see the impact clouding their political futures, the sequester could end fast.
There’s currently no consensus on the political impact. A Pew Research Center survey Feb. 13-18 found 49 percent said the cuts should be delayed while 40 percent said they should go into effect.
No one knows how this will ultimately play. “You have to take the long view. It’s about results," said Nathan Gonzales, deputy editor of the nonpartisan Rothenberg Political Report. If the economy stumbles, critics will point to the sequester as a contributing factor, and those who defended it could be headed for trouble.
But, he said, “If the sequester happens and the economy is better for it a year from now, it becomes a much different kind of political issue."
