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Sterling Lounge: Week of 2/25/2013

Morning ya'll

I'm hung over so I'm just gonna post this weeks apocalyptic news per the New York Times


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Unless Congress intervenes, the law requires the Obama administration to impose $85 billion in across-the-board spending cuts to military and domestic programs on March 1. Those cuts would be the start of $1 trillion in cuts over the next decade. These cuts have come to be known as the sequester, and they are dominating the current political discussion in Washington. Here is a primer on what the sequester is and how we got here.

Q. What is the origin of the sequester?

A. It emerged from the refusal of House Republicans to raise the debt ceiling in 2011 without significant deficit reduction. In response, the two parties agreed to the Budget Control Act, which cut domestic spending over the next 10 years by about $1 trillion. Democrats refused to agree to more cuts without additional revenue from taxes, and Republicans refused to agree to tax increases.

Instead, Congress set up a committee to find further deficit reduction. To push the committee to reach a deal, negotiators established a fallback mechanism meant to be so onerous it would never happen: $1.2 trillion in across-the-board, automatic cuts to both military and domestic programs, set to begin this year.

Q. Why didn't they take effect on Jan. 1?

A. The New Year's Eve deal to head off automatic tax increases delayed the cuts for two months. The deal also reduced the size of the cuts by $24 billion, out of a total of $109 billion this year, with a combination of cuts and tax revenue measures.

Q. Why the word "sequester"?

A. In past decades, budget laws have periodically allowed the executive branch to make small across-the-board spending cuts to the levels initially appropriated by Congress. These cuts are known as "sequestration" because the government withdraws the money after Congress has released it.

The looming sequestration is much larger than previous ones, though. Over the full fiscal year - Oct. 1 to Sept. 30 - the cuts would equal roughly 5 percent of nonmilitary programs and 8 percent of defense programs. Because they would hit almost halfway through the fiscal year, the White House Office of Management and Budget estimates the true impact for the final seven months to be closer to 9 percent for nondefense programs and 13 percent for defense programs.

Q. Whose idea was it?

A. That is in dispute. Republicans say the White House came up with the idea. Democrats agree, to a point. But Democrats explain that the president proposed a mix of automatic tax increases and domestic cuts.

Republicans rejected that mix and said they would instead accept another idea they had traditionally opposed: military cuts. Regardless, the Budget Control Act, including the cuts, passed on a bipartisan vote that included almost all Republican leaders, andPresident Obama signed it.

Q. Can the federal departments and agencies choose which programs to cut, sparing those that officials consider vital?

A. No. Under the rules, the percentage cuts must apply to specific programs, projects and activities. Everything is subject to the same percentage cut. That spreads the pain, but it also prevents agency managers from focusing the cuts on programs that may be ineffective or inefficient - and protecting those that may affect public health and safety.

Q. When will people begin to notice the cuts?

A. Around March 1, federal offices must tell contractors, grant recipients, governors and others how much money they stand to lose. By the end of the month, people will begin to notice changes.

The first checks that go out after that deadline to the unemployed - likely around March 7 - will have a substantial reduction, 9.4 percent. The first checks to doctors and others who care for Medicare patients will also be nicked.

The secretary of defense notified Congress on Wednesday that employee furloughs were necessary. By April 6, 45 days from that notice, layoffs and furloughs will begin in the Defense Department's enormous civilian work force. Other furloughs, affecting air traffic controllers, meat inspectors and others, will begin in April and are likely to accelerate as the departments struggle to meet savings targets by Sept. 30.

Q. In the coming weeks and months, could Congress and the White House cancel or replace the cuts?

A. Yes, but right now the parties are far apart on an alternative. Mr. Obama wants a 50-50 mix of spending cuts and tax increases to replace the sequester. Congressional Republicans say they are willing to shift the cuts to "mandatory" programs not subject to Congress's annual discretion, like food stamps, children's health insurance and Medicaid, and spread them out over 10 years. Republicans say they will not raise taxes.

Democrats hope to force Republicans to the negotiating table with a pressure campaign aimed at the public, but even they concede that is not likely to work until the pain of the cuts becomes apparent this spring.

Q. What might such a deal look like?

A. Mr. Obama wants the mini-deal that pushed the sequester from January to March to be the precedent: Half revenues, one-quarter military cuts, one-quarter domestic cuts. He also wants it to be large enough to put off the sequester until Sept. 30. That delay could give the White House and Congress time to negotiate a larger budget deal that included both cuts to Social Security and Medicare and tax increases.

Republicans say they will not accept any additional tax revenue. Any deal is likely to fall somewhere between the two parties' current positions.

Q. The two years have been filled with one budget deadline after another. Is this the end?

A. Not necessarily. Any subsequent deal to cancel the sequester would probably include a new deadline. If negotiators fail to meet, the next nine years of sequestration cuts would presumably kick in.

Beyond the sequester, the budgetary authority to keep the federal government operating runs out on March 27. Unless the two parties can agree on a new deal, portions of the federal government could be required to shut down that day.

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You gotta love our governments new policy of playing brinksmanship every month

Oh and Argo won picture of the year or something

There was also this

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