Sequestration: The Bottom Line

Posted on February 12, 2013

While it may seem that the White House has been more focused gun control and immigration over the past several weeks, President Obama is expected to make the economy his central theme and renew his call to avoid sequestration when he delivers his State of the Union tonight. There are just 17 days until the sequester is schedule to take effect and the President is certain to call for new tax revenue to avoid the $85 billion in spending reductions due March 1^st even as Republicans reiterate their strong opposition to any new revenues.

Meanwhile, Senate Democrats will soon release a proposal to replace the across-the-board cuts with new revenue and other spending reductions. This is most likely a short-term fix through the end of the calendar year, possibly setting up Congress for another New Year’s battle on spending cuts. But it appears that the Senate proposal is unlikely to get any support from Republicans, which is why so many believe that sequestration will happen on March 1^st.

The bottom line: If Republicans cannot get a new deal involving entitlement cuts but without new tax revenue, they prefer accepting sequestration cuts to defense programs as the price of getting some cuts to domestic programs. If Democrats cannot get a deal involving more tax revenue but without entitlement cuts, they prefer accepting sequestration cuts to domestic programs as the price of getting some defense cuts. The cuts will reduce domestic programs by 5.1 percent and defense by 8 percent, but since they come in the middle of the fiscal year, the impact is closer to 9 percent for nondefense and 13 percent for defense programs. Many federal agencies will likely see 14-day furloughs for employees and layoffs for new hires.

Today in Congress

Posted on February 12, 2013

The Senate is in at 10:00am and will vote on a number of amendments to and final passage of the reauthorization of the Violence Against Women Act (S 47). It is expected to pass. The Senate will recess from 12:30pm to 2:15pm for weekly party caucus lunches.

The House returns at noon and will consider three bills under suspension of the rules: the Hydropower Regulatory Efficiency Act (HR 267), the Collinsville Renewable Energy Promotion Act (HR 316), and the Veteran Emergency Medical Technician Support Act (HR 235). The House will recess no later than 5:30pm to allow a security sweep of the chamber prior to President Obama’s State of the Union address.

At 8:20pm, the Senate will proceed to the House of Representatives for President Obama’s State of the Union address, set for 9:00pm. The House will meet again at about 8:35pm for the purpose of receiving, in a joint session with the Senate, the President of the United States.

Another Short Term Sequestration Fix?

Posted on February 11, 2013

Senate Democrats plan to announce a short-term sequester replacement bill this week aimed at combining alternative spending cuts and new tax revenue to avert $85 billion in automatic spending reductions scheduled to begin taking effect March 1^st. Republicans, who adamantly oppose any use of tax revenue to replace the sequester, are not part of the broader discussions with democratic senators. It is possible that the Senate will consider the yet-to-be-released measure the week of February 25^th, after next week’s Presidents Day recess.

The Week Ahead

Posted on February 8, 2013February 8, 2013

Both the House and Senate are out of session today. The Senate returns to work at 2:00pm Monday and will vote on a series of amendments to the Violence Against Women Act (S 47). A vote on final passage could come as early as Monday night. The House returns to work on Tuesday.

President Obama will deliver his State of the Union address on Tuesday evening. It is widely expected that he will focus on fiscal issues, including the deficit and taxes, and will call for Congress to come together to avoid the next fiscal cliff. It is also expected that he will address energy and climate issues, as well as gun control and immigration. All of these priorities will likely be reflected in his budget request, which will be released to Congress in early March.

On Tuesday morning the Senate Budget Committee, chaired by Senator Patty Murray (D-WA), will hold a hearing on the budget and economic outlook prepared by the Congressional Budget Office, and then on Wednesday that same committee will hold a hearing on the impact of budget decisions on families and communities. The House Budget Committee will hold also hold a hearing on the economic outlook on Wednesday.

Also on Wednesday, the House Armed Services Committee will hold a hearing titled “Impacts of a Continuing Resolution and Sequestration on Defense.” Congressman Adam Smith (D-WA) is the ranking member on this committee.

The Senate Judiciary Committee will hold hearings on comprehensive immigration revision Wednesday morning, this first of many hearings on this topic.

On Thursday (Valentine’s Day), the House Ways and Means Committee will hold a hearing on the itemized deduction for charitable contributions and on previous proposals to modify the deduction and its value. Congressmen Jim McDermott (D-WA) and Dave Reichert (R-WA) are both members of this committee.

Also on Thursday, the House Energy and Commerce Committee will hold a hearing titled “Sustainable Growth Rate: Data, Measures and Models; Building a Future Medicare Physician Payment System.”

Bill Introduced to Protect NIH from Sequestration

Posted on February 5, 2013

Today, Congressman Jim McDermott (D-WA) joined his colleagues to introduce a bill to stop the across-the-board budget cuts scheduled for March 1^st with a balance of increased revenue and sensible investments. The Balancing Act will halt impending automatic federal budget cuts, known as “sequester,” which would threaten important national investments like those in medical research—a staple of Washington State’s economy. Read more here.