News From Terre Haute, Indiana


February 27, 2013

ANALYSIS: Potential budget ‘sequester’ was put in place months ago

TERRE HAUTE — Republicans and Democrats are bracing for the “sequester” – automatic spending cuts set to take effect Friday – by putting very different faces on what it means and who’s to blame.

Many Republican, conservative and libertarian sources are playing down the potential impact of sequestration. Many Democratic and liberal sources are playing it up. Meanwhile, the GOP and Democrats are equally split on who is responsible for the looming sequester.

The bulk of the automatic spending cuts that make up the “sequester” were part of the Budget Control Act of August 2011. The BCA called for the cuts – totaling $1.2 billion over nine years – to take effect if a bipartisan, congressional “supercommittee” didn’t find its own $1.2 trillion in cuts by Nov. 23, 2011. The “supercommittee” deadlocked along party lines, failed in its task, and the sequester train left the station.

The 2011 BCA sprang from Republican reluctance to agree to another increase in the so-called “debt ceiling,” an overall indebtedness limit Congress periodically places on itself. Eventually, Congress voted to boost the debt ceiling by $1.2 trillion as long as the supercommittee was formed. Republicans also insisted that they preserve the threat to sequester on Jan. 2, 2013, if the supercommittee failed to find its own cuts — which it failed to do.

As it stands, the sequester would focus most cuts on “discretionary” congressional spending – which basically means everything except the big entitlement programs of  Social Security, Medicare and Medicaid.

The “sequester” was set to take effect with the New Year. Remember the “fiscal cliff” America was facing as 2012 ended and 2013 began? The “cliff” was a combination of tax increases and big budget cuts. In a last-minute deal, Congress and the president agreed to avert the “fiscal cliff.” Their agreement consisted of postponing the spending cuts (the sequester) while agreeing to about $620 billion in new taxes. Instead of a full “fiscal cliff,” we were left with just a half a cliff.

Many Republicans felt they lost the game of chicken at the edge of the fiscal cliff because they agreed to higher taxes without getting spending cuts. Now they are in no mood to accept new taxes in any deal to avoid sequestration. Democrats, on the other hand, don’t want to accept big cuts in mandatory spending programs without new tax hikes.

Even if the two sides could agree to trim mandatory spending, Republicans and Democrats have different ideas for how to do that. The GOP favors allowing competition to bring down health care costs, but Democrats would rather curb fees to drug companies, hospitals and find new ways to deliver health care.

As a result, any last minute deal to avoid big cuts in discretionary spending by Friday looks unlikely.

Reporter Arthur Foulkes can be reached at 812-231-4232 or


Text Only | Photo Reprints
Latest News Poll
AP Video
Kerry: Humanitarian Cease-fire Efforts Continue Raw: Massive Dust Storm Covers Phoenix Raw: Corruption Trial Begins for Former Va Gov. UN Security Council Calls for Gaza Cease-fire 13 Struck by Lightning on Calif. Beach Raw: Shipwrecked Concordia Completes Last Voyage Raw: Airstrike Shatters Fragile Calm in Gaza Israel, Hamas Trade Fire Despite Truce in Gaza The Carbon Trap: US Exports Global Warming Baseball Hall of Famers Inducted Traditional African Dishes Teach Healthy Eating Mother of 2 Makes NFL Cheerleading Squad at 40 Raw: Bolivian Dancers Attempt to Break Record Raw: Sea Turtle Hatchlings Emerge From Nest Italy's Nibali Set to Win First Tour De France Fox Dons 'Bondage Strap' Skirt at Comic-Con Raw: Violent Clashes Between Libyan Militias Kangaroo Goes Missing in Oklahoma Today in History for July 28th Trial Begins Over OKC Bombing Video
NDN Video
'Hunger Games: Mockingjay Part 1' Sneak Peek GMA: Dog passes out from excitment to see owner Chapter Two: Designing for Naomi Watts Baseball Hall of Famers Inducted Florida Keys Webcam Captures Turtles Hatching Morgan Freeman Sucks Down Helium on 'Tonight Show' Robin Wright Can Dance! (WATCH) She's Back! See Paris Hilton's New Carl's Jr. Ad Big Weekend For Atlanta Braves In Cooperstown - @TheBuzzeronFox Chapter Two: Becoming a first-time director What's Got Jack Black Freaking Out at Comic-Con? Doctors Remove 232 Teeth From Teen's Mouth Bradley Cooper Explains His Voice in 'Guardians of the Galaxy' Deja vu: Another NYPD officer choke-holding a suspect 'Fifty Shades of Grey': Watch the Super Sexy First Trailer Now! Reports: Ravens RB Ray Rice Suspended For 1st 2 Games Of The Season Air Algerie plane with 119 on board missing over Mali Diamond Stone, Malik Newman, Josh Jackson and others showcase talent Free Arturo - The World's Saddest Polar Bear A Look Back at Batman On Film Through The Years

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
  • -


    March 12, 2010

Real Estate News