The spending reductions under the baseline in the budget sequester are days away from taking effect. Unless there is a dramatic change in the political situation, there will be a reduction of about $85 billion in budget authorization spread out over some domestic programs and a healthy whack out of national defense. This translates into about five percent of the affected programs on a fiscal year basis.
Note, that a few items before we go on. The federal deficit will be nearly a trillion dollars this year again. The government borrows more than $3 billion a day to fund its operations; the national debt has increases nearly 6 billion since January 2009.
President Obama has hit the campaign trail again to rally against his own makings, really the warpath to denounce the sequester. Denounce an idea which originated in the White House in the summer of 2011 and which he signed into law.
Mr. Obama, of course, is blaming all of this on the Republicans; many of them do not like the concept but have had enough of rising federal largess. According to Mr. Obama, life in these United States will come to an end shortly because of all of this. No more lollipops for anyone.
The President has suggested the cuts be avoided by increasing taxes. No news there. He says, the sequester will be a drag on the economy but fails to mention the tax rate increases that went into effect, including the employee payroll tax, a few months ago. Seems that is not a drag at all.
The President went on to say, some federal employees and contractors might lose their jobs. I am not sure why this group is immune to the vulgarities of the economy. Just because a person works for the government does not give a Japaneseesque lifetime of work. I am sympathetic to those being let go in any job but tough darts; everyone loses a job in their lifetime. The survival of the economy and the country should not be linked to federal employment. If it is, we are collectively worse than even I thought.
Woe be to all of us. All of us were threatened by Mr. Obama that national parks may close early or some other catastrophic event will occur. The country will become defenseless. Firefighters (which I think are hire by local governments) will allow houses to burn down. Oh, yeah, criminals will flood the streets and more illegal aliens will cross the border from Mexico, although I think that is already the case. Where do they come up with this kind of stuff but the better question is who believes it?
The performance of the President yesterday was pure nonsense. It was uninformed at best, probably disingenuous and perhaps even dishonest. It was all political but not helpful. It was not, however, revealing. He has been promoting more government since the taking office and he really does not have any interest in the deficit or long-term financial health of the country.
There is a perception the sequester means there are actually spending cuts. Not true. Federal spending will be higher this year than last and will continue to increase each and every year henceforth. In addition, the pesky national debt soon to be $17 trillion is on it way to $20 trillion before Mr. Obama leaves office, more than double under his regime.
I believe sequester should take effect. It is a clear demonstration of the failure of Congress and failure of the leadership of Mr. Obama. It may be a needed jolt to address federal spending and the unsustainable of federal debt, deficit and spending. Some sort of action has to start sometime and somewhere. This is as good point as any.
It was shameless performance of Mr. Obama. Not serious and does not care. That is as about as bad as it can get. It is all about blaming someone, never taking responsibility, not suggesting anything concrete and never listening to anyone else.
Oh by the way, the Administration has not even submitted its budget yet--long overdue.