Obama Calls for Compromise on Sequester

Posted on August 21, 2012October 17, 2012

President Obama said Monday that he thinks both parties can compromise and avert the across-the-board spending cuts under sequestration that could take sizable cuts out of both defense and non-defense discretionary spending. In an interview with The Virginian-Pilot’s military editor that focused on the sequester — the 10-year, $500 billion cut to both defense and non-defense discretionary spending set to hit in January 2013 — Obama said that both Democrats and Republicans have to give to reach a deal.

Despite the President’s call for compromise on sequestration, the two parties remain deadlocked on a solution to avert the cuts, which both parties consider bad policy. Obama and Democrats have said that Republicans are protecting tax cuts for the wealthy over the defense cuts, while Republicans say that Democrats are holding the military hostage to force tax increases.

No action on this will be taken until after the November elections. And, based on past efforts to reduce the national debt, it is still unclear whether or not either party is willing to compromise to reach a middle ground or “grand bargain” on this effort. Time will tell. In the meantime, we are advising the UW community to plan for a potential of 8.4% (or more) cuts to federal grants and contracts.

Sequestration Transparency Act Signed Into Law

Posted on August 10, 2012October 17, 2012

On August 7th, President Obama signed into law HR 5872, the Sequestration Transparency Act (PL 112-155). As previously reported on this site, in July, Congress overwhelmingly cleared the bill which requires the Administration to report, within 30 days, the effects of the automatic budget sequester at the “program, project and activity level.” The Administration will have to clarify the reductions that will result from the looming across-the-board cuts of sequestration. This information will be made public shortly after Labor Day, and should help UW and others plan for the impacts of sequestration.

OMB Issues Sequester Memo

Posted on August 1, 2012October 17, 2012

In a memo to federal agencies dated July 31, 2012, the Office of Management and Budget (OMB) indicated that military personnel would be spared in automatic budget cuts due early next year and that agencies should continue normal spending and operations even with the potential reductions just five months away. OMB Acting Director Jeff Zients said in the memorandum that OMB officials will meet with departments to discuss how the cuts under sequester work and what programs could be exempt. Up to now, administration officials have indicated that they believe Congress will find a way to avoid the sequester, and the White House still believes a budget agreement to replace the sequester is possible. In the meantime, Zients suggested agencies not adjust their rate of spending at the October 1^st start of the fiscal year but “continue normal spending and operations since more than five months remain for Congress to act.”

Read the OMB memo.

CR Through March 2013

Posted on July 31, 2012October 17, 2012

Well, it’s official! Senate Majority Leader Harry Reid and House Speaker John Boehner have reached a deal to keep the federal government funded for six months, meaning there will be no threat of a government shutdown when the federal fiscal year ends September 30th. The funding deal would keep government spending at current levels through March 2013. Both chambers of Congress will likely vote on the resolution when they return from the August recess the second week in September.

Today in Congress

Posted on July 30, 2012October 17, 2012

The House is not in session today. The Senate’s in at 2:00pm and will hold a procedural vote on the nomination of Robert E. Bacharach of Oklahoma to be United States Circuit Judge for the Tenth Circuit Court of Appeals. The Senate then will turn to S 3414, the Cybersecurity Act of 2012.

As reported last week, support is growing for a six-month continuing resolution (CR), which will delay FY 2013 spending decisions until next year and free up time during the lame-duck session for lawmakers to deal with expiring tax cuts and the budget sequester. House Republicans are expected to introduce the measure in September, when Congress returns from its five-week August recess, with a goal of averting a government shutdown when the new fiscal year begins October 1^st. However, the details, including funding levels, still need to be worked out.