In 2011, Obama proposed the sequester cuts — worth roughly $1.2 trillion over 10 years — in exchange for the GOP’s agreement to raise the federal government’s debt limit up to $16 trillion.
The sequester can be lifted if Obama and Republicans agree on an alternative deficit-cutting plan. They have not been able to agree on a plan, partly because Obama wants to increase the federal government’s tax income, even after winning a new round of taxes during the December 2012 “fiscal cliff” deal.
If not lifted, the sequester is slated to trim $85 billion from the federal government’s $3.8 trillion budget.
However, because of federal accounting rules, actual spending cuts during 2013 will be less than $85 billion.
That’s because many 2013 spending decisions by agencies are only commitments to spend money over the next several years.
For example, budget rules say the agencies must account for major contracts — such as building a warship or a bridge — in the year a program is launched, even though the checks will be sent out over a period of several years.
So, even if the $85 billion cut is fully implemented, it will only slice an estimated $42 billion from spending in 2013, according to a report by the Congressional Budget Office.
“If lawmakers chose to prevent those automatic cuts each year without making other changes that reduced spending by offsetting amounts, spending would be $42 billion higher in 2013 and $995 billion (or about 2 percent) higher over the 2014–2023 period than is projected in CBO’s current baseline,” said CBO’s February report, titled “The Budget and Economic Outlook: Fiscal Years 2013 to 2023.”
That $42 billion is only about 1 percent of 2013 spending.
GOP aides also said administration officials — including Homeland security secretary Janet Napolitano — are holding the nation hostage until they get tax increases. On Feb. 25, Napolitano gave a press conference in the White House where she said the sequester would cut manpower needed for border security and cargo-checks.
“Napolitano in briefing room to sell ‘If we don’t get a 2nd round of tax hikes, we’ll compromise homeland security’ message,” said a Feb. 25 response tweet from Rory Cooper, a press aide to Majority Leader Rep. Eric Cantor.