In the coming days, you will hear a lot about “sequestration” or “the sequester.” Sadly, a lot of what you'll hear will be misleading. I want to explain what it is, what it is not, and what it means for our country. If you’re in a rush, skip to the bottom where I share how we all ought to think about the sequester and why it is a good first step, even if an imperfect one, towards fiscal discipline in Washington, D.C.
The Facts About “Sequestration”
On March 1, a little less than two weeks from now, our government will spend less money on a number of federal programs. But only a little less. The sequester is nothing more than a reduction in spending for federal discretionary programs. Here is how it works:
As a result of the sequester, discretionary federal spending will be reduced by about $85 billion in 2013 and by about $1.2 trillion over the next 10 years combined. Most federal programs will see about a 5% reduction from their 2012 spending levels. The Department of Defense will be affected more with a reduction of approximately 8% from 2012 levels.
In nearly every case, agency spending will be above levels found in 2008, a time not widely known as an era of frugality or austerity.
The sequester is so small that it doesn't even begin to offset the increase in federal mandatory spending. So, in spite of President Obama’s rhetoric, total federal spending will actually continue to spiral ever upward. The federal government will still spend more in 2013 than in 2012.
Big Government Advocates Want You To Panic
Just a year and a half ago, President Obama demanded the sequester and signed it into law. Now he is joining Congressional Democrats who seek to create a panic.
President Obama and Nancy Pelosi use words like “meat cleaver,” “tragic,” and “devastating” to describe the sequester’s roughly 5% decrease in spending. Between now and March 1, the airwaves will be full of stories of asserted victims of a “scrooge-like” attack resulting from the sequester.
Pay close attention: Politicians making this assertion have no interest in smaller government. They seek to abandon the sequester so your federal government can continue to expand, so America’s deficit will increase, and so they can raise Americans’ taxes. (The White House has been particularly focused on increases taxes on business jets, which will only further harm the South Central Kansas economy.)
I’ve heard from many people running programs that will be impacted. It’s true—funds available for some of them will be reduced. But the hysterical rhetoric doesn't match the facts.
An example. Just this past week, my office received a video message from the Chancellor of the great University of Kansas, Ms. Bernadette Little-Gray. Instead of embracing a message of financial responsibility, Chancellor Gray-Little implores me to “Stop the Sequester”—arguing that the “sequester” would be a disaster for children's education, private enterprise, and American innovation.
But the facts belie the magnitude of this impact. As a result of the sequester, federal grants at KU will decline from $245 million to a projected $233 million. Apparently the reduction would take federal funding of grants back only to the level KU received just one year earlier. That’s not to mention the $28 million dollars KU spent over the past couple years from President Obama’s stimulus bill.
Click the image to watch KU’s chancellor make outrageous claims against spending cuts
Like President Obama, KU’s Chancellor argues that we should address the deficit through “balance.” That is code for more taxes on hard-working Kansans and more money redistributed to Washington, D.C. While I share the Chancellor’s desire to make our Kansas schools great, she ignores the threat to those same young people resulting from the fact that every graduate of her college this May—my son Nick among them—is already responsible for over $54,000 in federal debt. As for private enterprise, she fails to recognize the simple truth that it is not federal government spending that creates wealth, jobs, and prosperity for our state and for our country.
There are many other videos just like this one. The demand for more of your money is endless. Last week, the No. 2 Democrat in the House of Representatives, Rep. Steny Hoyer, took to the House Floor. There, he called me misguided and wrong for believing that addressing our nation’s annual $1 trillion deficit was a good thing.
Click above to hear the Democratic line on spending cuts
They just don’t get it. And neither will the media.
Sequester—A Home Run For America. If Only It Were A Grand Slam . . .
Make no mistake about it. There will be real human beings that receive fewer federal dollars as result of the sequester. Were we not $16 trillion in the hole and continuing to spend $1 trillion per year more than we are taking in, perhaps our nation could continue to spend at this rate. But we borrow 43 cents of every dollar America spends. Because of that debt load, we have diminished job growth.
To my regret, the sequester impacts the Department of Defense more than any other agency. I hope that we can, at some point, fix that flaw. Our nation’s most important task is national security and this rapid decrease in spending for defense comes amidst major challenges. Yet, based on principle and my experience as a veteran, I know that every governmental function can be done better and more efficiently. This year’s sequester will not affect military payroll for soldiers nor veterans benefits and health care.
When I voted for the legislation that created the sequester, I actually sought even lower spending levels. That’s why it’s only a home run and not a grand slam. Still, it will be the first time that we have reduced federal discretionary spending two years in a row in the history of post-World War II America. And, while the decrease is only a small fraction of the almost $4 trillion the federal government spends each year, the sequester will demonstrate that our political system can actually lower spending. This credibility is important to both voters and financial markets.
The Questions To Ask – And Why We Have To Get Spending Under Control
When you are listening to pundits yap about the dangers of sequestration or when your friends tell you the sequester is awful, think about, and ask them to think about, the following:
- Did you think our federal government was too small in 2008? Our 2013 federal discretionary spending will be above 2008 levels after the sequester.
- Remember when the President said unemployment will remain below 8% if he ramped up federal spending? How’d that work? Today, unemployment is still higher than when the President took office—and a record 47 million Americans are on food stamps.
- Do you think the tax increases in January of this year were just on “the rich” as the President continues to say? Fact: 77% of all taxpayers are paying higher tax rates today than just two months ago (and we haven’t even seen the Obamacare taxes take full effect yet!). To reduce the deficit in a so-called “balanced” way means less money in the pocket of everyone in America.
- The President makes it sound like businesses and families could easily do without their own hard-earned money, but then sounds the alarm when the people ask government to make do with just a little less. Isn't that an obvious contradiction?
We still have lots of work to do to get our economy moving again. We must put in place policies that promote economic growth. Here’s a good place to start: Get government to stop spending at ever and ever larger levels.
Member of Congress