October 5, 2012
In a little over five weeks, Congress will return to Washington, D.C. for a lame duck session. Many issues are on the agenda, including whether to extend the Bush tax cuts and how to keep the U.S. Postal Service solvent. But perhaps the biggest issue facing Congress next month is sequestration.
By way of reminder, the Budget Control Act (BCA) which passed in the summer of 2011 established a framework to lower the federal deficit. It cut over $1 trillion from non-defense discretionary programs over the next ten years. The Super Committee was also formed as part of the BCA, tasked with identifying trillions of dollars more in additional savings. If the committee could not reach agreement, or if Congress could not pass their proposal, then automatic cuts would go into effect every year for 10 years. As we all know by now, the Super Committee couldnít reach agreement. Sequestration has now become the default method for addressing the deficit.
I voted against the BCA for a number of reasons. I was not convinced that the Super Committee would succeed, and I was very concerned about the alternative approach to addressing the deficit if they did not. Sequestration is simply not a responsible way to manage the federal deficit.
A couple of weeks ago, the Obama Administration released a report prepared by the Office of Management and Budget that details for the first time, how exactly sequestration will impact federal programs and agencies. The cuts detailed for some programs are simply staggering. For the most part, programs are subject to an 8.2% cut in 2013. It is not clear yet how deep the cuts will be in future years. Some programs will be cut more than 8.2% and some will be cut less.
If you are interested, the full report can be found here: http://democrats.budget.house.gov/publication/omb-report-pursuant-sequestration-transparency-act-2012
In the next few weeks, weíll use this newsletter to highlight some cuts to illustrate just how devastating they will be if sequestration goes into effect. The programs are listed by Department, in the order that they appear in the OMB report.
Department of Agriculture
- Food Safety and Inspection Service: $86 million
This agency is responsible for conducting food inspections, monitoring the safety of our nationís food supply and taking action when food safety issues arise. In some cases, its efforts lead to product recalls essential to protect the health of consumers. The Service will have significantly fewer resources to make sure food is safe.
- Women, Infants and Childrenís Program (WIC): $533 million
The program makes nutritious food available to low-income pregnant and nursing women and their children. Please keep in mind as you read this e-update that these program cuts will happen every year for ten years ó this is not a onetime funding reduction. So WIC will undergo a $533 million cut in January, then hundreds of millions more in future years. As many as 750,000 mothers and children will lose access to the WIC program in 2013 if these cuts go into effect.
- Wildlife Fire Management: $172 million
This money is used to fight forest and brush fires all over the country. All too often these types of fires burn for days before they are extinguished, resulting in the loss of life and property.
- National Oceanic and Atmospheric Administration (NOAA): $257 million
NOAA conducts weather forecasting, monitoring severe storms so that we are better prepared when they strike. The agency also participates in coastal protection efforts and operates the Fisheries Management Program.
Department of Education
- Office of Elementary and Secondary Education: $1.8 billion
This office helps states and communities make improvements in elementary and secondary education. It provides funding for federal initiatives that enhance learning for students of all ages, from early education to high school.
- Office of Special Education and Rehabilitation Services: $1.338 billion
This office supports schools and students by providing resources for special education and vocational rehabilitation. It also fosters research and training to improve teaching of persons with disabilities.
Department of Energy
- Office of Science: $400 million
This office is the primary federal agency for supporting scientific research in energy and basic physical science. Cuts to an office like this mean loss of jobs in research and development, at universities and labs as well as loss of new jobs in industries that would grow from innovation. This will put the United States behind when it comes to innovation and developing new technologies.
- Energy Efficiency and Renewable Energy: $148 million
This is the office responsible for developing clean technologies and renewable energy so we can reduce the cost of fuel, reduce our use of foreign fuel sources and develop resources that do not harm the environment.
Department of Health and Human Services
- Low Income Home Energy Assistance (LIHEAP): $285 million
This program provides funding for low income families who are having trouble heating their homes in the winter. It also serves needy families in warmer climates who are having difficulty cooling their homes.
- Centers For Disease Control and Prevention (CDC): $470 million
The CDC conducts disease research, develops public health policies, monitors potential health problems and so much more.
- National Institutes of Health (NIH): $2.518 billion
The NIH is the federal governmentís main source of funding for medical research. That medical research creates jobs and leads to important health discoveries. This funding is of particular importance to the Massachusetts economy, with its many teaching hospitals, research laboratories and academic institutions.
- Substance Abuse and Mental Health Services Administration: $275 million
This agency combats substance abuse through treatment and prevention, and provides funding for treatment programs. It is also responsible for helping to improve the quality and range of care for those suffering from mental illnesses. Approximately 169,000 individuals would lose access to treatment as a result of this cut.
As you can see, the sequestration cuts are deep and they will impact many Americans, including many of our most vulnerable citizens. They will also result in the loss of jobs ó and not just government jobs. Iíve written this before, but I think itís worth repeating. I believe that the most effective and responsible way to address the deficit is through a combination of spending cuts and revenue increases.
Keep in mind, the program cuts noted above are not one time reductions. They are coming every year for ten years unless another approach can be implemented. By way of illustration, if your family spent $100 on food last week and that expenditure was subject to sequestration at 8.2%, then you will have only $91.80 to spend on food next week. Your family would be the same size (or growing) and the need for food would be the same ó the only change is you have less to spend. Imagine if that same cut comes each week for ten weeks. By the end of the tenth week you would have only $42.50 to spend on food and your grocery needs would be the same.
I will fight vigorously to advance a balanced approach to lowering the deficit, one that does not rely on spending reductions alone. I will highlight additional programs in the coming weeks. As always, thanks for your interest in this newsletter.