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White House Warns Of Sequestration's Effects

White House officials warn that the effects of sequester cuts could offset economic growth.
Victoria Pickering (http://www.flickr.com/photos/vpickering/6295154112/)
White House officials warn that the effects of sequester cuts could offset economic growth.

The White House and congressional Democrats are sounding the alarm bells over the consequences of the sequester, the across-the-board cuts to the budget that are scheduled to go into effect in March.

White House Chief of Staff Denis McDonough said the cuts would offset "pretty good" economic activity over the past few months. He said President Obama had a plan to cut an addition $1.5 trillion from the deficit.

"He's ready to do another $1.5 trillion to get up to the $4 trillion target that economists across the country tell us is needed to stabilize the debt over the next 10 years," McDonough said on ABC's This Week. "So that's exactly what the president has done, working with Democrats and Republicans."

But he insisted that the plan would be "balanced," which would likely mean an increase in tax revenue.

Speaking on the same program, Rep. Paul Ryan, R-Wis., chairman of the House Budget Committee, was pessimistic about a deal to avert the cuts.

"The Senate hasn't passed a bill to replace the sequester. The president gave a speech showing that he'd like to replace it, but he hasn't put any details out there. So that is why I conclude I believe it's going to take place," he said.

McDonough's comments follow remarks by other officials who have warned of the consequences of the cuts.

Speaking on NPR's Weekend Edition Sunday, Gen. Martin Dempsey, chairman of the Joint Chiefs of Staff, said the sequester would affect both "time and casualties" in the military.

"The way this plays out, when you hollow out readiness, it means that when the force is needed, when an option is needed, to deal with a specific threat ... it would take us longer to react to those. So time is the issue," he said. "Some people would say, 'So what?' Well, time generally translates into casualties in my line of work."

As NPR's Brian Naylor is reporting for our Newscast unit, the cuts will mean federal spending will be reduced by $85 billion between March 1 and the end of September. Here's more from Brian's report on the effects of the sequester:

 

 

"HUD Secretary Shaun Donovan says it will mean a 5 percent reduction in funding for recovery from superstorm Sandy, and that some 100,000 homeless or formerly homeless, including veterans, would be removed from their current housing and shelters. The government also says because USDA food inspectors face layoffs, some meat processing plants wont be able to open, leading to higher food prices. Senate Democrats have proposed avoiding the sequester by spreading the cuts out and raising some taxes, but Republicans say that idea is a nonstarter."

 

 

NPR's Tamara Keith reported last week on the Senate Democrats' plan that would temporarily "replace the sequester with a mix of spending cuts and revenue increases.

"The cuts would be shared between defense and domestic spending; the revenue would come mostly from what's been dubbed the Buffett Rule, which would set an effective tax rate of at least 30 percent for the very wealthiest, no matter the source of their income."

Republicans rejected that plan as a nonstarter.

But Sen. Charles Schumer, D-N.Y, speaking on CNN's State of the Union said he believed the two sides would come together for an agreement.

"Whether it's right on the eve of sequestration or if God forbid it has to take effect for a few days, the devastating effects will be so strong the president will be there on his bully pulpit that I believe that just like on the fiscal cliff, Republicans will come on board," he said. "They have no choice."

The looming cuts are the result of the failure in 2011 of a congressional supercommitee to come up with a plan to reduce the deficit. The idea was to make the consequences of the proposal so severe that there would be a bipartisan push to prevent it from ever taking effect.

Republicans say Obama proposed and designed the sequester.

Copyright 2013 NPR. To see more, visit http://www.npr.org/.
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