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$85B in automatic spending cuts set to start as Congress fails to act

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By McClatchy Newspapers
Thursday, Feb. 28, 2013, 9:54 p.m.
 

WASHINGTON — Sometime on Friday, the federal government will take the first step toward cutting spending in dozens of departments and programs as each of the two major parties tried and failed to muscle partisan alternatives through the Senate.

With the last-minute effort to avert the automatic spending cuts failing, the House adjourned, the Senate wrapped up its scheduled business for the week, and most members went home.

That raised the stakes for a meeting in the White House with President Obama and the leaders of both parties in Congress as they debate how or whether they can change course in the days ahead as the spending cuts take effect over time.

“Tomorrow I will bring together leaders from both parties to discuss a path forward,” Obama said after the congressional votes failed.

“As a nation, we can't keep lurching from one manufactured crisis to another,” he said. “Middle-class families can't keep paying the price for dysfunction in Washington. We can build on the over $2.5 trillion in deficit reduction we've already achieved, but doing so will require Republicans to compromise.

“That's how our democracy works, and that's what the American people deserve.”

With Congress gone, even a last-minute breakthrough agreement that no one expects likely would come too late to stop the first moves to start cutting $85 billion from this year's $3.5 trillion budget.

Sometime before midnight — the 2011 law requiring the cuts stipulated only that they start going into effect on March 1 — Obama is expected to sign a directive ordering the White House Office of Management and Budget to start putting the cuts into effect.

With much of the federal budget such as Social Security off limits, the cuts will be concentrated on a smaller part of the government, split evenly between defense and non-defense programs. Many will take weeks or even months to go into effect.

The 2011 law set the automatic cuts to force Congress and Obama to come up with a more palatable alternative to curb deficits by $1.2 trillion over 10 years.

Democrats insisted on adding tax increases and smaller spending cuts. Republicans insisted that it all be done with spending cuts. That's where they ended up again on Thursday in the Senate.

Democrats proposed curbing projected deficits with a minimum 30 percent tax on millionaires, the closing of tax loopholes and spending cuts to military and farm programs.

Republicans proposed keeping the same amount of spending cuts but giving Obama flexibility in how the cuts are implemented.

“What we're about to go through is in some respects a charade because we know that the proposal on that (Democratic) side will not succeed with 60 votes,” said Sen. John McCain, R-Ariz. “The proposal on this side will not succeed with 60 votes. Meanwhile, the clock moves on until sometime tomorrow night.”

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