Will The Sequester Doom Obama’s Agenda?

Terrance Heath
Will The Sequester Doom Obama’s Agenda?

With apologies to Victor Hugo, apparently nothing in Washington is as powerful as a bad idea whose time has come — or at least, a bad idea no one in Washington has the political will or ability to stop. The sequester is one such idea.

Born from the ashes of the flameout of another bad idea known as the “Super Committee,” like the nightmarish remake of an old “Schoolhouse Rock” video, the sequester cuts are part of a short-term budget deal that’s on its way to President Obama’s desk to be signed into law.

As he locks them into place with the stroke of a pen, will the deep cuts that he himself has called “dumb” doom President Obama’s second term agenda?

Obama has repeatedly championed a set of government investments that he argues would expand the economy and strengthen the middle class, including bolstering early-childhood education, spending more on research and development, and upgrading the nation’s roads and railways. He has said his comfortable reelection victory in November shows the country is with him.

But none of those policies have come close to being enacted. Instead, after returning this weekend from a trip to the Middle East, Obama is set to sign a government funding measure that leaves in place the across-the-board cuts known as sequestration — a policy that undermines many of the goals he laid out during the 2012 campaign.

Obama thinks the cuts are, in his words, “dumb,” and he says they will slow the economy and harm priorities by cutting spending on education, research and development, and many other programs. Yet Obama now finds himself enacting a broad domestic policy that he doesn’t support and that he believes will harm the country.

Obama is in this predicament after failing to persuade congressional Republicans to agree to a plan of tax hikes and more targeted spending cuts to replace the sequester. The president misjudged his GOP opponents, who have held firm in opposing more tax increases and, so far, have decided to stomach the sequester cuts.

Wait a minute. The president is in this mess “after failing to persuade congressional Republicans” to agree a plan that includes tax increases? Let’s get something straight. If the president “failed” to persuade Republicans, it’s because Republicans refused to negotiation on tax increases.

The bottom line on American budgetary politics right now is that Republicans won’t agree to further tax increases and so there’s no deal to be had. This is not a controversial perspective in D.C.: It’s what Hill Republicans have told me, it’s what the White House has told me, it what Hill Democrats have told me. The various camps disagree on whether Republicans are right to refuse a deal that includes further tax increases, but they all agree that that’s the key fact holding up a compromise to replace the sequester.

But it’s unpopular for Republicans to simply say they won’t agree to any compromise and there’s no deal to be had — particularly since taxing the wealthy is more popular than cutting entitlements, and so their position is less popular than Obama’s. That’s made it important for Republicans to prove that it’s the president who is somehow holding up a deal.

This had led to a lot of Republicans fanning out to explain what the president should be offering if he was serious about making a deal. Then, when it turns out that the president did offer those items, there’s more furious hand-waving about how no, actually, this is what the president needs to offer to make a deal. Then, when it turns out he’s offered most of that, too, the hand-waving stops and the truth comes out: Republicans won’t make a deal that includes further taxes, they just want to get the White House to implement their agenda in return for nothing. Luckily for them, most of the time, the conversation doesn’t get that far, and the initial comments that the president needs to “get serious” on entitlements is met with sage nods.

There’s plenty of blame to go around here. No one — neither Democrat nor Republican — comes up smelling like a rose.

Certainly the sequester represents a failure for the White House, but it’s not a “failure to persuade Republicans”  to agree to tax increases. The reported nature of the negotiations is an important clue: the White House spent too much time bending over backwards to persuade people whose ideology rendered them utterly persuadable. As I learned upon hearing White House economic advisor Gene Sperling a couple of weeks ago, the sequester is upon us because the White House failed to realize who it was dealing with.

After listening to National Economic Advisor to the President Gene Sperling this morning, I think I have a better understanding of at least one reason why we ended up in this sequestration mess, and why no one in Washington can seem to figure way out of it. The White House didn’t know who it was dealing with on the Republican side of the negotiating table during the “fiscal cliff” fiasco. Even more distressing, now that the sequester is in effect, is the possibility that the White House still doesn’t know who it’s dealing with.

Sperling was one of this morning’s speakers at “The Economy Summit” in Washington, DC, sponsored by The Atlantic magazine. Sperling’s interview with Editor in Chief James Bennett followed a panel titled, “Debating America’s Addiction to Debt & Debt Debates: Which Matters More?”, featuring Robert Kuttner of The American Prospect, economist Craig Alexander of TD Bank, Paul McCully of the Global Interdependence Center, Yves Smith from Naked Capitalism, and moderated by Financial Times columnist Edward Luce — who also acted as a rhetorical stand-in for Fix the Debt’s Maya MacGuineas, who arrived late.

…Bennett’s next question to Sperling was even more revealing: “Did you guys miscalculate on the fiscal cliff, thinking that prospect of defense cuts wd force a deal?”

As I pointed out, sequestration was born out of the fiscal cliff debacle. The idea originated in the White House, but was embraced by Republicans.

So, the concept of sequestration began with the White House. But that doesn’t get us all the way to where we are today, just days away from suffering a major, self-inflicted economic wound. If the Obama administration gave birth to this bad idea, Republicans nursed it, fed it, gave it legs, and taught it to run.

It’s hard for anyone except the most committed conservative conspiracy theorist to think that the Obama administration actually wants the sequestration cuts to happen. Sequestration, as originally conceived, was never intended to take effect.

Now, Congress, back in 2011, also passed a law saying that if both parties couldn’t agree on a plan to reach that $4 trillion goal, about a trillion dollars of additional, arbitrary budget cuts would start to take effect this year.  And by the way, the whole design of these arbitrary cuts was to make them so unattractive and unappealing that Democrats and Republicans would actually get together and find a good compromise of sensible cuts as well as closing tax loopholes and so forth.  And so this was all designed to say we can’t do these bad cuts; let’s do something smarter.  That was the whole point of this so-called sequestration.

Unfortunately, Congress didn’t compromise.  They haven’t come together and done their jobs, and so as a consequence, we’ve got these automatic, brutal spending cuts that are poised to happen Friday.

The sequestration cuts were designed to be so incredibly stupid, painful and dangerous that lawmakers would be forced to come to some kind of agreement in order to avoid them. Unfortunately, that’s not how it went down.

It was enough, then, to make me wonder if the Obama administration knew who it was dealing with at the negotiating table — not John Boehner, but a tea party faction with an appetite for destruction that Boehner was to weak to confront, and thus failed to lead his caucus.

Sperling’s answer confirmed for me that the White House didn’t know who it was dealing with them, and perhaps still doesn’t know who its dealing with now. Sperling answered that “the sequester is not a victory for anybody’s priorities … the sequester is not a win for Democrat’s or Republicans.”

It’s hard to see how the president’s agenda, with its investments in jobs, infrastructure, and education, survives such drastic cuts. The sequester cuts have mind-numbing consequences for every part of the president’s expansive agenda:

  • The sequester could start another recession. According to Brookings Institution economist Henry Aaron, dealing with the deficit now “carries the high probability of delaying economic recovery and the possibility of turning recovery into decline.”
  • The sequester will slow down economic growth. Even if it doesn’t lead to a recession, the sequester will lead to much slower economic growth.
  • The sequester will halve economic growth. The Congressional Budget office says the sequester will cut U.S. economic growth in half this year, if it goes into effect.
  • The sequester will cost 750,000 to 1 million jobs. Congressional Budget OfficeCEO Douglass Elemendorf says the sequester could result in the loss of 750,000 jobs this year alone. The Bipartisan Policy center says 1 million jobs are at risk, because the sequester will pull so much money out of the economy so quickly.

Sequestration gets even more painful when cuts to education and social service programs begin to impact “real people.”

  • Children and mothers losing WIC nutrition aid: 600,000
  • Low-income children kicked out of Head Start: 70,000
  • Funding eliminated for special education teachers, aides, and staff: 7,200
  • Low-income families losing rental housing vouchers: 125,000
  • Formerly homeless people losing housing: 100,000
  • Children denied affordable child care: 30,000
  • Fewer people with disabilities served by Vocational Rehab: 75,700
  • Fewer meals on wheels served to seniors: 4m
  • Adults and children with serious mental illness losing treatment: 373,00

As awful as all of this is, sequestration is not a “no win” situation. The sequester is a huge win for ultra-conservatives who want to see these cuts happen, because it achieves something they couldn’t at the ballot box.

As I pointed out in a post last week, the sequester’s brutal, automatic, across-the-board cuts were never supposed to take effect. No, they were designed to be so damaging and stupid that both parties would be forced to come up with a compromise on spending cuts and revenue. Letting such draconian, damaging cuts take effect was supposed to be the last thing any member of Congress wanted to happen.

It’ turns out that Republicans see the sequester as an opportunity to inflict painful cuts that Americans don’t want and didn’t vote for, and the GOP’s ultra-conservatives want it to happen because they believe it’s the right thing to do.

[P]ointing out Republican-caused harms to millions of people — many of them Republicans — does not sway the ultra-right. Why? Democratic pundits say that Republicans want to hurt the president, to show government doesn’t work by making it not work, and to protect “special interests” from higher taxes. All true. But there is an additional and deeper reason. Ultra-conservatives believe that the sequester is moral, that it is the right thing to do.

Progressives tend to believe that democracy is based on citizens caring for their fellow citizens through what the government provides for all citizens — public infrastructure, public safety, public education, public health, publicly-sponsored research, public forms of recreation and culture, publicly-guaranteed safety nets for those who need them, and so on. In short, progressives believe that the private depends on the public, that without those public provisions Americans cannot be free to live reasonable lives and to thrive in private business. They believe that those who make more from public provisions should pay more to maintain them.

Ultra-conservatives don’t believe this. They believe that Democracy gives them the liberty to seek their own self-interests by exercising personal responsibility, without having responsibility for anyone else or anyone else having responsibility for them. They take this as a matter of morality. They see the social responsibility to provide for the common good as an immoral imposition on their liberty.

Their moral sense requires that they do all they can to make the government fail in providing for the common good. Their idea of liberty is maximal personal responsibility, which they see as maximal privatization — and profitization — of all that we do for each other together, jointly as a unified nation.

They also believe that if people are hurt by government failure, it is their own fault for being “on the take” instead of providing for themselves. People who depend on public provisions should suffer. They should have rely on themselves alone — learn personal responsibility, just as Romney said in his 47 percent speech. In the long run, they believe, the country will be better off if everyone has to depend on personal responsibility alone. Sequestration offers Republicans to potentially irresistible opportunities: the chance to bring President Obama down a peg or two, as well as a shot at implementing spending cuts that the majority of Americans have repeatedly rejecting at the polls. The consequences of those spending cuts doesn’t bother tea party conservatives in the least.

They’ve a lot of spirit and some really big megaphones. So, the GOP’s “Sequester Cheerleaders” will probably rack of even more stunners as this manufactured crisis drags on. We might as well keep track of them, so as to remind Americans who wanted the sequester — and its attendant economic pain and suffering — to happen.

The maddening part is that it seems inevitable that the sequester will happen, despite the reality that almost no one wants it to happen. Almost no one in Washington thinks it is a good thing, and most Americans don’t want to see these cuts happen.

Still, the bad idea known as the sequester, with its “just plain dumb” cuts, seems bound to become law, and bound to take down the agenda that President Obama laid out in his inaugural address.

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