RUSTHOVEN: The sky really isn’t falling

March 2, 2013

RusthovenIf our president is right—and who doubts a word he utters?—writing this is wasting time, as it is scheduled for publication that day after the “sequester” takes effect and life comes to an end. But on the off chance the world survives, let’s soldier on for the fraction of readers who might not always find this column a waste of time.

The sequester is $85 billion in federal spending cuts starting March 1. As the Washington Post’s Bob Woodward (no right-winger he) confirms, this was an Obama administration brainstorm to break the 2012 budget stalemate. The notion was that across-the-board cuts, originally scheduled for January 2013, would be so unthinkable the parties would agree on something else.

Apparently not so. Obama won the game of chicken in December, getting upper-bracket tax hikes with no spending cuts and delaying the sequester. The dynamics then were that, unless Republicans caved, taxes on all would rise and the GOP would be blamed.

The dynamics now are that the GOP, having learned this president’s “negotiating” style, is content to let 2012’s unimaginable cuts become 2013’s reality.

So, brace yourself for (quoting Obama) “arbitrary,” “severe,” “brutal” spending cuts, a “meat-cleaver” that will “eviscerate” all the good Washington does. There is “no smart way to do this.” Navy carriers will be dry-docked, jeopardizing national security. Obama’s other choices will be things like, “Do I close funding for the disabled kid or the poor kid?”

Public safety will be in shambles. Surrounding himself at the White House with uniformed officers (some saying later they were “potted plants”), Obama declaimed, “Emergency responders like the ones who are here today—their ability to help communities respond to and recover from disasters will be degraded.”

A Chicken Little chorus accompanies our lead singer. “Completely irresponsible”; “mindless”; “Sequestration equals unemployment” (House Minority Leader Nancy Pelosi). “A devastating list of horribles” (Obama Chief of Staff Denis McDonough). “Children will not get the kinds of services and opportunities they need and as many as 40,000 teachers could lose their jobs” (Education Secretary Arne Duncan).

There’s plenty more. But let’s take a breath—assuming anyone’s still breathing after “sequester day”—and put these “brutal” cuts in perspective.

Fiscal year 2008 federal expenditures were $2.9 trillion, with a $454 billion deficit. The FY 2012 figures are $3.8 trillion and $1.3 trillion. In four years under Obama, the annual spending and deficit figures have increased $900 billion and $846 billion. The $85 billion is about 10 percent of just these increases in annual amounts.

The FY 2013 budget request is $3.6 trillion (actual spending is always higher), of which $85 billion is 2.4 percent. But in fact, only about half the sequester cuts take effect in 2013; the rest are pushed out to later years. So this year’s actual sequester cut amounts to 1.2 percent of the budget.

Total federal debt when Obama took office was $10.6 trillion. Current national debt is $16.6 trillion. Total sequester cuts are 1.4 percent of the $6 trillion Obama increase, and 0.5 percent of the overall debt. The 2013 sequester cuts are 0.7 percent and 0.25 percent of these figures.

So, there’s your “meat cleaver” and its “brutality”—a tad over 1 percent of 2013 spending and about a quarter of a percent of the overall debt. However will we manage?

As Ronald Reagan observed, saying the federal government spends like a drunken sailor is an insult to drunken sailors. Nothing has changed—nor will it, while Obama presides.•


Rusthoven, an Indianapolis attorney and graduate of Harvard College and Harvard Law School, was associate counsel to President Reagan. Send comments on this column to ibjedit@ibj.com.


Recent Articles by Peter J. Rusthoven / Special to IBJ

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