The brutal politics of sequestration

The following post is a transcript of a 4-minute weekly radio commentary aired on several Utah radio stations:

In December 1995, just one year after the Gingrich Revolution when Republicans captured the House and Senate in the 1994 mid-term congressional elections, Newt Gingrich went toe-to-toe with Bill Clinton over budget sequestration.

In response to Gingrich’s insistence, President Clinton said fine, let’s shut down the federal government and he started by closing offices at the Social Security Administration, closing all national parks and monuments and any service having to do with veterans affairs. Clinton hinted that defense cuts would be next. Of course, we all know who won that fight – Bill Clinton – and threats of government shutdowns ever since have been idle threats at best.

So here we are again. Sequestration threatens our nation. For Utah, sequestration could have a major impact on our government and economy. Thirty percent of the Utah state budget comes from the federal government, and over a quarter of our economy is driven by federal dollars. Think about your own personal paycheck. If you made $4,000 a month, 30 percent would be $1,200. How difficult would be your family’s monthly budget decisions if that $1,200 disappeared over night? That’s what Utah is facing with sequestration.

And it’s not just our state government. The feds have their claws into every level of government in Utah. For instance, if sequestration hits on March 1, school districts across the state would lose money. Twenty-one percent of the Ogden School District’s budget comes from the federal government.

There’s a lot of money at stake – which means politics will be at their most brutal, and gaming ethics, not principles of sound government, will certainly rule the day. Let me give you one example.

À la Bill Clinton, President Obama claims that unless Congress raises taxes to undo sequestration, the Transportation Security Administration (TSA) would be forced to reduce security measures, leaving travelers and the airways vulnerable and increasing wait times at airports.

So there isn’t a dime that could be cut out of TSA’s budget that wouldn’t compromise national security? Of course they can cut without hurting national security.

For example, TSA has wasted millions of taxpayer dollars. According to one congressional report, evidently TSA has a warehouse in Dallas, Texas, where 5,700 pieces of unused security equipment sit in storage; the dormant equipment is worth $184 million; this equipment storage has cost taxpayers another $23 million in depreciation; and, the agency spends another $3.5 million every year just to lease and manage this warehouse. In addition, even though the net number of people traveling via air has decreased, TSA has actually hired more employees.

President Obama has thrown TSA on the sequestration table because he knows Americans care about terrorist threats and air safety. The truth is, like with any government budget, the federal budget is full of fat and waste. Programs could be cut, funding could be reduced, and our nation would still stand. In fact, it would be healthier to make serious cuts to the federal budget. If anyone ever needed reassurance that America is one big fat welfare entitlement state – and over-extended militarily throughout the world – the sequestration fight lifts the veil on this reality. You can measure our dependence on government by the decibel level of the people screaming to maintain funding

It’s important to realize that federal spending still goes up, even with sequestration. It just doesn’t go up Obama-fast. Either way, a dependent Utah will be scrambling to balance its budget.

For Sutherland Institute, I’m Paul Mero. Thanks for listening.

 

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5 Responses to The brutal politics of sequestration

  1. Zach Jacob says:

    Paul,

    You’re almost as bad as the president in using scare tactics to exaggerate the consequences of the pending federal budget cuts. Yes, 30% of the state budget (if not more, as I’ve heard in some estimates) comes from the federal government. Yes, sequestration is a contraction of federal spending (not really — in reality, it’s a contraction of estimated future spending, not actual cuts). But sequestration will not cut ALL federal funding that Utah has grown dependent on. Yes, it will impact us, but it will not be a 30% hit to the state budget. The estimates I’ve heard range from $300 to 500 million dollars, which, on a $13 billion dollar state budget amounts to approximately 2% – 4% less money — even if it all hit in the same fiscal year, which it won’t. And before you ask if the average family can live with a 2% cut in its take home pay remember this: We already are. The payroll tax “holiday” that expired on January 1 (remember sequestration 1.0?) cut all of our take home pay by about 2% already.

    So let’s not go all “Chicken Little” and scream about the sky falling. Rather, let’s use this as just more evidence that Utah has grown too dependent on federal handouts from a national government that can’t even sustain its own issues, let alone continue to fund state budget needs. Utah needs to become more self-reliant. And learning to live with a little less federal pork is a good first step in that direction.

    • Paul Mero says:

       Ha! I wasn’t trying to “go all Chicken Little.” I was trying to say this is important and we ought to get our (state) house in order. If you’re actually suggesting that the federal debt and spending aren’t that big of a deal for Utah, I would disagree…but I don’t think you’re saying that.

      Re-read my intro…”idle threats at best.” That said, Utah’s reality is that we’ll always face a problem with 30% of the budget coming from the Feds.

      • Zach Jacob says:

        Paul, I don’t doubt that we agree on the basic premise here: Utah needs to become more financially self-sufficient. However, sequestration will happen, but the way you illustrated it is completely misleading: “ Think about your own personal paycheck. If you made $4,000 a month, 30 percent would be $1,200. How difficult would be your family’s monthly budget decisions if that $1,200 disappeared over night? That’s what Utah is facing with sequestration.” That’s simply not true.

        Sequestration needs to happen. It’s a very small step in the right direction of getting federal spending under control. However, without meaningful entitlement reform, a balanced budget amendment, and some serious fiscal discipline in DC, it’s going to be looked back upon as a symbolic measure at best.

        Utah’s budget issues are a separate, but related, issue. Utah receives more back from the feds than we pay in federal taxes, and that’s a problem to start with. If Utah could break free of the federal purse strings (and having control of our own currently-federally-owned land would more than suffice in that regard), we’d be a lot better off. However, for that to happen, DC would have to give up control (read: power), and we all know how much they like to do that.

        • Paul Mero says:

           But it is true…as long as the specter of sequestration combined with out-of-control federal spending exists. The 30% is at stake…always. That what’s currently being debated isn’t the full 30% is beside the point…not irrelevant, just beside the point. If your concern with my point has to do with the congressional politics…that is, congressional Republicans are trying to downplay sequestration and Obama is trying to emphasize it…then I can’t help you. Even when I worked on Capitol Hill, I never read the Republican talking points. :)

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