Sequestration began when the Republicans and the Democrats were locked in a phony death struggle over the budget. They needed to find a way to reduce the deficit by about a trillion dollars, but neither side really wanted to propose anything. So they put off the deal with an agreement to agree in the future. BUT... that would not be enough to satisfy angry voters, so Obama came up with the brilliant idea of sequestration: “Uh, why not, uh, agree to reach an agreement in the future (after the election wink, wink), and to calm everyone we’ll slap a doomsday provision on this sucker. Basically, uh, if we can’t reach an agreement, then $500 billion in cuts will befall the favorite programs of each side.”
They shook on it and passed it into law.
Then the election happened and nothing really got resolved. So now it was up to both sides to reach an agreement to stop this doomsday device from going off.
But a funny thing happened on the way to doomsday. The Republicans discovered that this wasn’t really a doomsday device after all, at least not with their voters (I actually credit Rand Paul and some of the Tea Party people for breaking the Rasputin mindlock military spending has had on the Republican Party). So they started to realize that perhaps they were better off letting this thing happen.
For Obama, this was intolerable, because for the Democrats this was a true doomsday device. Not only would this actually cut programs they loved for real for once (the horror, the horror), but it gave the Republicans no reason to agree to the tax hikes the Democrats wanted. So Obama rushed out to try to pressure the Republicans to agree before anyone realized this doomsday device was really a Republican unicorn bomb. Oldbama hit the campaign trail and smeared the Republicans fiercely. Apparently, when these cuts kicked in, the world would literally end. The money in our wallets would melt away to ash, Yellowstone would be repo’d by China, old people would die of plague, and children would be eaten by the dinosaurs who escaped the Federal dinosariums. . . crunch crunch. Oh my!
But the Republicans held fast.
Then the cuts hit and the... world... didn’t... end... See, unlike prior shutdowns, this one didn’t result in chaotic things that could appear on the television. Doors weren’t looked, tourists weren’t stranded, and benefits didn’t stop coming. Few people will actually lose their jobs. Indeed, all that’s going to happen is that agencies will need to find ways to shave about 3% off their budgets for the year. In a federal government that wastes at least a third of all spending, this can be done quite painlessly. And since the public doesn’t really care about the fates of overpaid federal workers, it’s going to be very hard to upset the public with stories of one-day-per-week furloughs.
So the public yawned.
Actually, I would suggest the public not only yawned, but they smiled. The problem with cuts has always been that no one would accept having their own programs cut because they don’t want to be the only one whose programs get cut. So no one agrees to cuts. But people would accept across the board cuts that actually affect everyone equally. This sequestration feels like an across the board cut. Moreover, most people will find that nothing they want has actually been cut. So as far as the public is concerned, these appear to be ideal cuts because they happen to everyone else.
So now the Democrats are freaking out and you’re starting to see the first wave of articles about how horribly they’ve played this. In December, they were bragging how this would force the Republicans to agree to tax hikes and now they’re trying to explain how they could let the programs their supporters love get cut and why the Republicans no longer have any incentive to ever agree to tax hikes to cut the deficits. Ha ha. Basically, what the Democrats saw as the unthinkable nuclear option turned out to be everything the Republicans wanted in the budget deal and then some, and now they are struggling to explain how they missed this. Savor the sorrow of Rep. Gerry Connolly (Duh-Va), “We lost the bet on just how intransigent the Republican majority can be. We made a mistake betting on reasonable compromise ultimately prevailing. We bet on that and we lost.” Yep, sucker.
Now, I can’t really pin this on tactical brilliance on our part. To the contrary, I suspect our side was busy trying to find a way to hand a victory to Obama the whole time and just couldn’t find a way to do it. I also suspect some members of the party. . . looking at you McCain. . . are probably still struggling to find a way to hand Obama a victory in the days to come. But it’s still nice that we stumbled upon this and I do give Boehner credit here.
In any event, I would do the following at this point if I were running the Republican Party:
(1) Embrace these cuts as intentional, “genuine, across the board 3% cuts,” and point out how this is still less than normal people have taken in the way of pay cuts during the Obama years. Either way the media fights that we win. If they call these not genuine, they you say “so what’s the problem with sequestration?” and you demand more. If they call them draconian, then you pound away both on these being significant/real and you ask how the Democrats could object to a 3% cut.Finally, here’s the watershed. The longer this goes on and the world doesn’t end, the more I think the public will feel at ease with cuts. That could well give us the ability to propose across-the-board cuts to get cuts in place, and that is a very good thing for us. Watch for signs of an attitude change in the public.
(2) Attack Obama for the specific cuts he makes. Remember, we caused the 3% cut, but he picked what would actually be cut: “We didn’t want your stuff being cut, dude. Obama picked you. . . he’s a very bad man, a very bad man.”
(3) IF any particular cut(s) creates a problem that begins to sway the public, fund that cut and that cut alone. And when you send the funding bill, include other things you want and dare Obama to veto it. Also, I would challenge Obama to find an alternate cut.
Thoughts?
29 comments:
You forgot to mention that 170 million people will lose their jobs!
Obama way overplayed his hand and now looks weak and stupid. He opulent get a deal and the wold didn't end.
I still have little faith in the GOP to not mess it up.
Opulent? Um, that was suppose to be couldn't.
My bad. I totally forgot about the forgotten 170 million who will lose their jobs. LOL! The Democrats really are idiots aren't they?
You know what's funny is that the tone of the Democrats and the journalists I've seen really is shell shocked, like they simply never imagined we this was a possible result and now they have no idea how to fix it.
Koshcat, That's ok. I've become a typo machine lately. I'm not entirely sure, but perhaps part of my brain died. So typos are no big deal to me anymore.
Thanks for this article Andrew, I kept hearing about this sequester and just ignored it as it seemed as some sort of ploy, little did I know that Obama created this in his last term!
I'm glad that the repubs held fast with tax hikes and that there will be a 3% cut across the board. I heard however that this does not go into effect until 2014, is that true?
Thanks for the summary!
Joceyln, You're welcome. :)
It was created as part of the big budget deal where the two sides were looking to raise the debt ceiling to avoid default. They were at an impasse and Obama proposed this idea of putting off the need to reach an agreement and then using a "nuclear option" to force both sides to reach an agreement.
Only, the nuclear option turned out not to be that nuclear -- $500 billion from DOD over ten years and $500 billion from the rest of government over 10 years. This means there will be cuts in the budgets for each of the next ten years -- off the top of my head the number this year is $85 billion in cuts between now and October (fiscal year).
In terms of effect, it went into effect on March 1 -- two days ago. So fake-armageddon has already happened, and Obama is already backtracking on the negative effects. He's now saying basically that "yeah, nothing bad will happen right away, but it will cause the economy to be destroyed some day." At the same time, even liberal newspapers are starting to point out that all the stuff he said would happen won't happen.
From what I've seen, it sounds like the plan is to introduce 1 day per week furloughs for some government employees, to scale back some service hours, and they may try to put some programs on pause in the DOD -- but I suspect they are more likely just to slow the work rather than stop it because stopping it will cost a fortune.
In the end, I think very few people will feel much of a pinch from this.
Andrew.....Perfect example of Dem political posturing over ANY issue over the years. Oh my Gawd....If the Repubs do this, then there will be fire and brimstone, rivers burning, dogs and cats living together, basically the end of the WORLD!!!
Wha? None of that happened like we said it would if X passed? Thank the Dems for changing the rules at the last minute to stave off Armageddon that the Repubs wanted to impose on you.
Media: Oh Thank You Mr. President! You saved us all again!! You are the greatest President EVER!!
We'll see if this sequestration follows the same old pattern and Mr. Wonderful gets credit for anything positive (or even NOT happening) that comes out of this. Somehow the press will spin it as a victory for Zero and the Dems.
I will take any tiny little win we can
Patriot, regardless how the media spins it, the House Republicans have just learned that they can hold the line on cuts and get them without having to concede tax hikes. Not only does this neuter Obama's only strategy, but it makes the Republicans seem less dangerous, i.e. Obama can't do anything but Republicans don't look scary stopping him.
My main concern is that Democrats will rewrite history if Republicans allow it. Republicans need to adamantly claim the cuts and defy anyone who claims otherwise. (Including McCain.) If they are adamant enough, they could even correct the history of the Clinton years: "We got these cuts through even though we had to drag Obama kicking and screaming, just like Clinton in the 90s." People totally dig that "history repeats itself" stuff, so that would be a good way to correct memories.
My secondary concern is that Rush and the low-information talkers (sounds like a band) will convince their faux-tea party listeners (also sounds like a band) that Boehner and the RINOs (that sounds like a band, too) sold them out on phony-cuts and that it's a Rockefeller-establishment conspiracy (everything sounds like a band, now) against the Holy Constitution (that would make an awesome album title).
Andrew, I hate to say it but my industry is feeling the pinch and they are still laying off people (defense). But I do know my company has announced that they'd like to expand into the commercial industry so that they aren't so dependent upon government contracts. At least they are trying something!
Heh heh heh. :-)
It was really amazing listening to the Sunday morning talk shows yesterday; everyone was bemoaning the fact that the sequester had happened. "This is so terrible! Proof that Washington is broken and hyper-partisan!" Blah, blah, blah. It would never occur to them that something good might have taken place.
And, of course, there's the whining Obama personally took part in, which is just the icing on the cake.
Patriot, That's the Democratic way. They lie and scream and hope to tar people, then they when things their bluff gets called, they try to claim credit for the thing they fought. I still remember the Democrats doing that about Reagan's defense build up and then Newt's welfare reform -- every dirty trick in the world to stop those until they finally happened and then claimed credit for it.
Jed, I agree. Every little bit helps, but I'm hoping for a cultural change here.
tryanmax, I agree. The Republicans need to claim these cuts (at least in principle if but not in specifics) and they need to make them sound reasonable. I like the idea of talking about dragging Obama kicking and screaming and then pointing out he's a chicken little. Those are things that will help the Republicans regain the label of "responsible", which is something they've lost and something which the Democrats have wrongly been able to claim since they calmed their rhetoric and the Republicans started doing their dirty work for them.
"Low information talkers"... isn't that the truth.
I think the danger to the Republicans comes from two fronts. (1) The RINO contingent is no doubt trying to find a way to compromise right now because they are pathological compromisers. (2) Talk radio will savage the Republicans for made up surrenders because savaging the Republicans has really become their bed and butter.
I have to say though that I'm honestly seeing signs that the Republicans have changed as a party and are breaking away from the talkers finally, which is a good thing.
Andrew:They lie and scream and hope to tar people, then they when things their bluff gets called, they try to claim credit for the thing they fought.
This type of behavior is due entirely to owning the press. Otherwise they'd be laughed out of the country. If the Republicans don't do something about the media - e.g. buy up more than Fox news, then they are likely toast in the near future and Republicans will be what the Tories are in Britain, the "me too" party.
Jocelyn, I still have a handful of defense contractor clients so I know what you mean because I've been busy helping them prepare for potential terminations/stop work orders.
The thing is it's not all that clear how this will play out. Prior to the election, defense contractors warned all their employees (at least through the media) that they could all be laid off because of this. But that won't happen. DOD has apparently decided to reduce their procurement by 7.8% this year, so that is the amount that needs to come out of procurement budgets.
How that will happen isn't clear. It could come from simply stopping some contracts or squeezing contracts or both. My guess is that they will stop something with high visibility but little immediate value like the F-35, and then they may kill a couple programs they were thinking of killing anyway. Beyond that, I'm not sure how this will play out. I suspect that most companies won't feel a thing, and others will find their contracts slowed by not stopped (to avoid incurring things like severance pay costs).
How the companies respond is a different matter and it wouldn't surprise me if defense contractors use this as an opportunity to trim payrolls and demand a few concessions... "be grateful you still have a job!" I doubt this will be a good time for defense workers, but I also suspect the threat will be much greater than the actual impact.
I wish you the best though. :)
T-Rav, Washington is broken whenever things the Democrats want to don't happen. Otherwise, it's "the brilliance of our system" keeping those evil Republicans from getting their way.
I have to say that it was fun hearing the bitter tones. The Democrats overplayed this SO SO badly and now they seem to be struggling with understanding how their plan could have failed.
K, I agree. The Republicans need to step up the media game because everything is an uphill fight for them right now and the Democrats always get the easy path.
Here are some bad numbers for the Democrats. According to Rasmussen, only 40% of people want the sequester cuts stopped -- 32% don't. But that also means that 28% don't care. That means 60% "favor" the Republican position.
There was a great quote from somewhere about the sequester along the lines of TOTUS campaigning for it, pushing it through, then denying any responsibility for it...
It must be good to be king - until it isn't :)
rlaWTX, LOL! Nice! :)
Yeah, this time the lie machine failed him and I think he's in a bit of a shock trying to understand how it could have failed him.
"Yeah, this time the lie machine failed him and I think he's in a bit of a shock trying to understand how it could have failed him."
I think he's gonna havta' play a couple of extra rounds of golf this week to figure it out or maybe drone some "terrorist" village in Yemen to make himself feel better.
Bev, Or he might try bombing a golf course for once... or a "terrorist" village in Kansas.
Andrew...Regarding your defense contractor comments above: What the DoD will do (and has done, from personal experience lately) is not extend contracts even though they might have told contractors they would be extended. Or they will reduce the contract amount and force contractors to lay off.
As Jocelyn commented, many small defense contractors will redouble their efforts to get business in the private sector. My firm has done that as the new reality sank in last year. Or, get contracts with a fed agency, not DoD. Another avenue my firm was successful doing.
Here's another factor that most people outside of government work never see...many...MANY...gov't workers were hired originally to actually DO the work, whether in IT, admin, planning, finance, wherever. Over the last decade, their positions were taken over by gov't contractors and the guvvies moved into "managing" the contractors who were doing their old job! So now, if the DoD especially lets the contractors go, the guvvies will have to go back to their old jobs. Now think of the changes just in the IT sector. Does anyone think these clowns will be able to move back in and be anywhere near as productive, or as quality conscious as the up-to-date contractors were.
You think the gov't services are poor now, wait until these lifers screw things up so royally that the gov't will be begging contractors to return.
I'm sure you see this in your line of work also.
Andrew: My guess is that they will stop something with high visibility but little immediate value like the F-35..
I'll go out on a limb and say the F-35 isn't going to get cut. It may get stretched out, but the 35 is a definite "need" program. Plus, Lockmart stock didn't budge after "S" day. Neither did Boeing's, but they were smart enough to move their corp headquarters to Chicago just prior to Obama being elected.:)
Defense contractors have been laying people off from the beginning of the Obama administration and that is being accelerated - the layoffs have concentrated on the over white male 55+ demographic which are "over represented" in that work force.
Patriot, NONSENSE! Those would be personal services contracts and that would be illegal... wink, wink. Yeah, you're right. From what I've seen a ton of government contractors these days are basically doing the work assigned to government personnel. So if they cut back on those contracts or eliminate them, then the totally unqualified and unmotivated government staff will need to do the work themselves... meaning, it won't get done and certainly won't get done right.
I think you are right that the primary response will be trying to milk contractors to do more for less. I've already seen a lot of warnings to contractors not to let the government sell them on the idea of being "patriotic" which means working for free.
Ultimately, the best plan for any contractor is diversify if possible into the private sector as well. Most of my clients have done their best in that regard because they didn't want their entire futures depending on the government. But of course, that depends on finding things you can offer.
K, I don't think they'll cut the F35, I think they'll just slow it. They'll stop work on various parts, slow the cycle, send it back for more tests, etc. It's rare that they kill an entire program, especially one this far along.
They might also decide to reduce the number of planes or cancel some ship/sub they wanted. But my guess is that nothing will get cancelled, but calendars will get stretched a bit.
I don't know the name of the law but it was passed sometime in the Nixon administration. Essentially the law states that the President must spend all the money appropriated by congress.
Nixon was not spending all the appropriated money on some projects and supposedly was accused of using that money for prvate funds. Congress did not like Tricky Dick so they made it illegal not to spend all the money allocated each year.
Anyrate even though it might give Obama more power I think they should accept his desire to talk (saw that he wants to have a meeting with Boehner on Brietbart) and offer removing this as a benny to him. Make him think it is something he'd want.
Then the President would have descreiton to save money. honestly the running of the Executive branch is the President's job anyways. If a President can run medicare on 10 billion less without harming benefits ... so be it.
Impoundment. The Congress took away this power and now forces the President to spend all the money it gives him.
Reagan tried to get it back and couldn't, and attempts to give presidents the line-item veto are premised on this.
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