It turns out that "budget sequestration," portrayed as an evenhanded way to spur bipartisan negotiations over budget deficits, is actually a dagger aimed at defense spending. The president and other top administration officials have said the automatic spending cuts required by sequestration are "bad policy." But they still support "sequestration" as a political tool instead of proposing needed changes that might fulfill its original purpose: pushing Democrats and Republicans into realistic budget negotiations.
The whole sequestration process is something of a sham. Sequestration aimed to promote agreement on the deficit-cutting supercommittee by creating an alternative that seemed worse: automatic cuts in defense and non-defense spending. The theory was that the fear of sequester would so upset Republicans (against deep defense cuts) and Democrats (against domestic cuts) that they would negotiate a more acceptable package. By the same logic, Congress would then approve the supercommittee's plan.
Wrong. The supercommittee didn't agree. With hindsight, this is unsurprising, because the sequester is not neutral. Though defense spending represents 19 percent of the budget in 2012, it would absorb half the cuts. Moreover, many entitlements (Social Security, Medicaid) were excluded from cuts. As supporters of domestic spending, Democrats had less reason to fear sequester. Similarly, the sequestration imposed no automatic tax increases; this appealed to Republicans. And because sequestration itself wouldn't start until 2013, failing to agree in late 2011 had little political fallout.
So: The sequestration now scheduled for next January means about another $500 billion in military cuts over the decade.
Defense Secretary Leon Panetta has repeatedly denounced the sequester. Testifying Feb. 16 before Congress, he said sequestration "would inflict severe damage on our national defense."
Panetta talks as if sequester won't occur because the consequences would be so dreadful. Somehow after the election, Congress will reach a better budget agreement. Perhaps. Fast forward to November. One party and perhaps both will be embittered by the election's outcome. Congress will face two and possibly three highly contentious issues: the expiration of the Bush tax cuts of 2001 and 2003 at year-end, the looming start of the sequester, and, possibly, the need to raise the federal debt ceiling (the Bipartisan Policy Center estimates this could occur in November).
The confluence of so many big issues -- with timetables -- could inspire a grand compromise. It also could produce chaos. The sequester could take effect by default and confusion. The Obama administration's continuing embrace of the sequester as a political lever, when it clearly hasn't worked, makes this outcome more, not less, likely.
I have before suggested an alternative: Change the sequester. Don't use it to gut defense. Instead, split the $1.2 trillion in automatic savings between across-the-board tax increases and automatic cuts in "entitlements," including Social Security and Medicare. These consequences would truly frighten Republicans and Democrats. They might actually bargain in good faith. Also, advance the sequester's start to late summer, so that bargaining would precede the election.
This would force the president, Democrats and their Republican opponents to debate long-term budget choices that ought to be at the center of the campaign. It's unlikely, because our "leaders" are more interested in one-upmanship than governing.