TELL US: Do You Care About 'Sequestration'?

Has the scary news about the impending federal sequester got you worried?

If it feels like we went through something like this just a month or so ago, you're right.

That was when we were warned that the country was set to nosedive off the "Fiscal Cliff" back in December. As you'll recall, part of the Fiscal Cliff was a series of tax cuts dating from the Bush Administration era that were set to run out unless President Barack Obama and Congress came to terms before the expiration.

You saw the results when the government took a bigger cut from your first paycheck in 2013.

But now we're teetering on the verge of another federal precipice with the Sequestration. But what is it?

What the Sequester Is

Part of the resolution of the Fiscal Cliff was the American Taxpayer Relief Act. That extended some tax cuts and raised the nation's debt ceiling so the federal government could keep functioning. Part of the agreement was that in exchange for those goodies, there would be $1.2 trillion in spending cuts to deal with the nation's ballooning debt.

Those cuts were supposed to be negotiated by a bipartisan Super Committee with a March 1st deadline. If the Super Committee couldn't come up with an agreed-upon $1.2 trillion in cuts, the Sequester would automatically kick in.

The sequester is an across-the-board 10 percent cut across all federal departments, affecting both the military and social spending.

What Sequestration Isn't

The $1.2 trillion in cuts would take place over a ten-year period. The White House, which agreed theoretically to the cuts when Obama put his signature on the American Taxpayer Relief Act, put out a series of 51 press releases to show what is viewed as the harm that would be caused by spending cuts. 

The sequester was a measure that would cause automatic cuts if Congress and the Super Committee couldn't come up with the cuts themselves. That was a compromise to deal with spending hikes in order to try and take a stab at the nation's burgeoning $16.62 billion debt. 

In New Jersey, the cuts in the short term would mean the loss of millions for higher education, aid for disabled children, and environmental funding, according to the White House. 

There would also be massive furloughs - not firings - of Department of Defense employees, since part of the sequester's bipartisan nature was that the cuts would affect Republicans (typically viewed as being pro-defense) and Democrats (seen as being for social spending.)

The alternative to spending cuts, as the Obama administration sees it, is raising taxes on the wealthy.

TELL US: What do you think about the sequester? Are you worried it'll mean immediate pain from which the nation and the state won't recover? Are you worried about the national debt? Should Congress raise taxes on the rich to stave off sequestration budget cuts? What do YOU think?

gam February 26, 2013 at 11:26 PM
We could probably absorb ever dollar of this in cuts to foreign aid.
chupa February 27, 2013 at 12:20 AM
Can we please remember that this is not actually a cut in spending ... what is does is cut the rate of increase in speding!! Obama has got to stop putting his chicago style political view above the people of this country.
Michael Lewis February 27, 2013 at 03:50 PM
At the risk of economic heresy... The dollar is no longer linked to a fixed standard (be it gold, silver, or whatever) – its value is simply relative to that of other currencies. This is fine so long as we – as a nation – are prepared to control our money supply, can produce enough of our strategic essentials so as not to have to pay for imports in foreign currency equivalents, are prepared to offer our trading partners high-enough interest rates to hold the dollars rather than spend them (or produce enough things they might want to buy or be prepared to have them buy strategic assets or otherwise invest here in the US) or are prepared to accept a certain amount of inflation. To date oil has been denominated in dollars, and many abroad accept low interest rates on dollar deposits because the dollar is perceived as a “safe haven” of value. We are no longer strong enough or independent enough to be the sole arbiter of the value of the dollar…eventually something will have to give. It is unfortunate that it will take an artificial crisis to force an honest and transparent discussion (which will probably not occur anyway).
Jane Doe February 27, 2013 at 04:59 PM
Debt: another manufactured crisis. Calvinists cry, "The sky is falling! The gov't borrows half of every dollar it spends!" (Meanwhile at home they borrow 80% of disposable income-- hopefully they'll move that back towards 50% during this period of contraction & low interest rates.) Yes, gov't spending needs trimming during hard times. Since the late '70's our gov't could see the wane of mfg coming. Instead of facing it head-on, gov't chose to jigger the accounting, turning our economy into a casino, dividing our people among the 'house' & the poor slobs gambling their disappearing incomes away. The world will right itself; mfg is already starting to come back as 3rd-worlders become too wealthy to make outsourcing profitable. Meanwhile we have to cut. Maybe sequestration helps the pols save face. And Yes, for heaven's sake, we need to tax the rich. During the 1950s and early 1960s, the top bracket income tax rate was over 90%--and the economy, middle-class, and stock market boomed. We've been trying the opposite path for decades: where's the $$? Get any of that trickle yet??
Westfield123 February 27, 2013 at 09:06 PM
Obama came up with the idea of Sequestration now live with it. Why doesn't Obama and his wife try to conserve some of our money? Both of them try to come off like a regular brother or sister but meanwhile they like to live the high life at our expense. Trips to Aspen, Hawaii, MV and golf with Tiger Woods. Meanwhile, the majority of Westfielders put him in office.


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