Posted on February 14, 2013
If you want a job, don’t move to Washington D.C. in the next couple of months.
The sequester is a job killer.
One of my friends who works as a Chief of Staff in a Congressional office is bracing for the $200,000 cut that will hit his budget if the sequester goes into effect. That means he is going to have to first at least two people and maybe more.
Another friend who works at the Department of Justice just got done having a discussion with her staff about how many people will furloughed from her department if the budget axe falls.
David Rogers, the famous reporter from Politico, did a story about how the Defense Department is dealing with the potential sequester. They are spending money faster so that when the sequester actually hits, they will have such a budget crisis, that the Congress will in all likelihood crumble. At least, that’s the theory.
I had a client (had being the operative word) who is so worried about the sequester he fired all of his consultants.
The sequester is a job killer.
But it is a necessary tool to force the Obama White House to come to the table on entitlement reform.
John Boehner said quite rightly that he doesn’t want the sequester to go into effect. But the law is the law, and unless the President puts some real spending cuts on the table to entitlement programs, the law won’t be changed.
During budget negotiations last year, the President put on the table some small changes to the rate that dictates how much money people get in Social Security payments. That rate is called the Consumer Price Index and by making the smallest adjustment, the government could save trillions of dollars.
The President agreed in principle to the adjustment, but then backed away when his political base went nuts.
Same thing happened to Medicare. The President and Republicans both agreed in principle to raise the retirement age and to increase contributions to the Medicare system by wealthy people by means testing. Those changes would save trillions more to the government, and probably wouldn’t impact that daily lives of most Americans.
But the President backed away from that proposal too. He didn’t want to offend his base.
The President likes to get credit for proposing some cuts in entitlement spending. But right now, he has turned his back on those common-sense proposals.
The idea of sequester in government spending was first imagined in government as part of the Gramm-Rudman-Hollings budget reform act in the 1980’s Warren Rudman (who recently passed away) said of the sequester axe that enforced the budget limits in the Gramm-Rudman-Hollings, called it “a bad idea who time had come.”
And it was. Sequester is a mindless policy. It kills jobs willy-nilly, without any thought to any strategic planning about how or why the jobs should or shouldn’t be killed.
But, we have to do something about spending. And if the sequester is the only way to force the President back to the bargaining table to negotiated in good faith on entitlement spending reform, well, so be it.
Sequester is bad policy. It is a job killer. And it might be our only hope to saving the Federal government in the long-term.