If you want a thorough agency-by-agency rundown of the budget cuts sequestration would deliver, the Office of Management and Budget has you covered. In compliance with The Sequestration Transparency Act of 2012, the OMB sent a detailed report to Congress in September 2012. But there’s a small problem with the report: One of the cuts it warns against would affect an agency that no longer exists–and didn’t exist when the OMB sent its report to congress.
The first line item on page 121 of the OMB’s September 2012 report says that under sequestration the National Drug Intelligence Center would lose $2 million of its $20 million budget. While that’s slightly more than 8.2 percent (rounding error or scare tactic?), the bigger problem is that the National Drug Intelligence Center shuttered its doors on June 15, 2012–three months before the OMB issued its report to Congress.
Here’s a screenshot of the OMB’s report:
Here’s a screenshot of the DOJ website’s announcement that the NDIC had closed:
Might there be other errors in the OMB’s report?
Despite little sign of a deal emerging with Republicans, President Barack Obama says he does not believe it is inevitable that the $85 billion in across-the-board budget cuts will take effect.
Federal budget cuts called “sequestration” are scheduled to hit in just 10 days. The sequestration cuts are not perfect—they’re a blunt instrument to cut spending, rather than a deliberative plan that sets priorities, trims entitlements, and cuts other spending. But they are law.
It would be better to replace them with smarter cuts, but the reality is that Washington has to start cutting spending now. Real program reforms and a balanced budget are the only way to solve our continuing fiscal crises. So it is critical that Congress keep its word and follow through on these spending cuts to prove it is serious about bringing our budget into balance over the next 10 years.
Now that the March 1 deadline is approaching, the President is urging Congress to offset the sequestration budget cuts with more tax increases.
That’s simply unacceptable, says Heritage’s Grover M. Hermann Senior Fellow in Federal Budgetary Affairs, Patrick Louis Knudsen: “President Obama has already pocketed a $618 billion tax increase, so simply holding the line against taxes is a given.”
Lawmakers shouldn’t be fooled by the President’s rhetoric on a “balanced” approach to sequestration or any other budget issue—that simply means he’s looking to raise taxes again.
Instead, they should be focusing on true balance—balancing the federal budget in the next 10 years. Producing a budget would be a start, but balancing that budget is the way to put the country back on track. Knudsen explains:
Government spending and debt are both too high, and this threatens all Americans with a weaker economy and a lower standard of living. Every opportunity to reduce spending and put the government on the path to a balanced budget must be taken. Anything less is a path to defeat.
We need spending cuts that are targeted to the programs that need reforms—the entitlements that are the major drivers of our growing deficit.
Sequestration leaves many programs like Social Security, welfare, food stamps, and Medicaid untouched, while having devastating effects on national security. Trying to use defense cuts to balance the out-of-control entitlement spending while we still face growing threats (Russia, China, Iran, and al-Qaeda affiliates) is a fool’s errand that will create a hollow military and do nothing to fix economic troubles.
But if Congress does not replace the sequestration cuts with smarter cuts—like eliminating Obamacare funding or other ineffective programs—then the sequestration cuts will be our first step toward getting serious about federal spending.
Read the Morning Bell—and more!—en español every day at Heritage Libertad.
“I speak to you tonight from Washington, D.C. The state of our economy is tenuous but our people remain the greatest example of freedom and prosperity the world has ever known.
People say America is exceptional. I agree, but it’s not the complexion of our skin or the twists in our DNA that make us unique. America is exceptional because we were founded upon the notion that everyone should be free to pursue life, liberty, and happiness.
For the first time in history, men and women were guaranteed a chance to succeed based NOT on who your parents were but on your own initiative and desire to work.
We are in danger, though, of forgetting what made us great. The President seems to think the country can continue to borrow $50,000 per second. The President believes that we should just squeeze more money out of those who are working.
The path we are on is not sustainable, but few in Congress or in this Administration seem to recognize that their actions are endangering the prosperity of this great nation.
Ronald Reagan said, government is not the answer to the problem, government is the problem.
Tonight, the President told the nation he disagrees. President Obama believes government is the solution: More government, more taxes, more debt.
What the President fails to grasp is that the American system that rewards hard work is what made America so prosperous.
What America needs is not Robin Hood but Adam Smith. In the year we won our independence, Adam Smith described what creates the Wealth of Nations.
He described a limited government that largely did not interfere with individuals and their pursuit of happiness.
All that we are, all that we wish to be is now threatened by the notion that you can have something for nothing, that you can have your cake and eat it too, that you can spend a trillion dollars every year that you don’t have.
I was elected to the Senate in 2010 by people worried about our country, worried about our kids and their future. I thought I knew how bad it was in Washington. But it is worse than I ever imagined.
Congress is debating the wrong things.
Every debate in Washington is about how much to increase spending – a little or a lot.
About how much to increase taxes – a little or a lot.
The President does a big “woe is me” over the $1.2 trillion sequester that he endorsed and signed into law. Some Republicans are joining him. Few people understand that the sequester doesn’t even cut any spending. It just slows the rate of growth. Even with the sequester, government will grow over $7 trillion over the next decade.
Only in Washington could an increase of $7 trillion in spending over a decade be called a cut.
So, what is the President’s answer? Over the past four years he has added over $6 trillion in new debt and may well do the same in a second term. What solutions does he offer? He takes entitlement reform off the table and seeks to squeeze more money out of the private sector.
He says he wants a balanced approach.
What the country really needs is a balanced budget.
Washington acts in a way that your family never could – they spend money they do not have, they borrow from future generations, and then they blame each other for never fixing the problem.
Tonight I urge you to demand a new course.
Demand Washington change their ways, or be sent home.
To begin with, we absolutely must pass a Balanced Budget Amendment to the Constitution!
The amendment must include strict tax and spending limitations.
Liberals complain that the budget can’t be balanced but if you cut just one penny from each dollar we currently spend, the budget would balance within six or seven years.
The Penny Plan has been crafted into a bill that millions of conservatives across the country support.
It is often said that there is not enough bipartisanship up here. That is not true. In fact, there is plenty.
Both parties have been guilty of spending too much, of protecting their sacred cows, of backroom deals in which everyone up here wins, but every taxpayer loses.
It is time for a new bipartisan consensus.
It is time Democrats admit that not every dollar spent on domestic programs is sacred. And it is time Republicans realize that military spending is not immune to waste and fraud.
Where would we cut spending; well, we could start with ending all foreign aid to countries that are burning our flag and chanting death to America.
The President could begin by stopping the F-16s and Abrams tanks being given to the radical Islamic government of Egypt.
Not only should the sequester stand, many pundits say the sequester really needs to be at least $4 trillion to avoid another downgrade of America’s credit rating.
Both parties will have to agree to cut, or we will never fix our fiscal mess.
Bipartisanship is not what is missing in Washington. Common sense is.
Trillion-dollar deficits hurt us all.
Printing more money to feed the never-ending appetite for spending hurts us all.
We pay higher prices every time we go to the supermarket or the gas pump. The value of the dollar shrinks with each new day.
Contrary to what the President claims, big government and debt are not a friend to the poor and the elderly. Big-government debt keeps the poor poor and saps the savings of the elderly.
This massive expansion of the debt destroys savings and steals the value of your wages.
Big government makes it more expensive to put food on the table. Big government is not your friend. The President offers you free stuff but his policies keep you poor.
Under President Obama, the ranks of America’s poor swelled to almost 1 in 6 people last year, reaching a new high as long-term unemployment left millions of Americans struggling and out of work.
The cycle must be broken.
The willpower to do this will not come from Congress. It must come from the American people.
Next month, I will propose a five-year balanced budget, a budget that last year was endorsed by taxpayer groups across the country for its boldness, and for actually solving the problem.
I will work with anyone on either side of the aisle who wants to cut spending.
But in recent years, there has been no one to work with.
The President’s massive tax hikes and spending increases have caused his budgets to get ZERO votes in both houses of Congress. Not a single Democrat voted for the President’s budget!
But at least he tried.
Senate Democrats have not even produced a budget in the time I have been in office, a shameful display of incompetence that illustrates their lack of seriousness.
This year, they say they will have a budget, but after just recently imposing hundreds of billions in new taxes, they now say they will include more tax hikes in their budget.
We must stand firm. We must say NO to any MORE tax hikes!
Only through lower taxes, less regulation and more freedom will the economy begin to grow again.
Our party is the party of growth, jobs and prosperity, and we will boldly lead on these issues.
Under the Obama economy, 12 million people are out of work. During the President’s first term 800,000 construction workers lost their jobs and another 800,000 simply gave up on looking for work.
With my five-year budget, millions of jobs would be created by cutting the corporate income tax in half, by creating a flat personal income tax of 17%, and by cutting the regulations that are strangling American businesses.
The only stimulus ever proven to work is leaving more money in the hands of those who earned it!
For those who are struggling we want to you to have something infinitely more valuable than a free phone, we want you to have a job and pathway to success.
We are the party that embraces hard work and ingenuity, therefore we must be the party that embraces the immigrant who wants to come to America for a better future.
We must be the party who sees immigrants as assets, not liabilities.
We must be the party that says, “If you want to work, if you want to become an American, we welcome you.”
For those striving to climb the ladder of success we must fix our schools.
America’s educational system is leaving behind anyone who starts with disadvantages.
We have cut classroom size in half and tripled spending on education and still we lag behind much of the world.
A great education needs to be available for everyone, whether you live on country club lane or in government housing.
This will only happen when we allow school choice for everyone, rich or poor, white, brown, or black.
Let the taxes you pay for education follow each and every student to the school of your choice.
Competition has made America the richest nation in history. Competition can make our educational system the envy of the world.
The status quo traps poor children in a crumbling system of hopelessness.
When every child can, like the President’s kids, go to the school of their choice, then will the dreams of our children come true!
Washington could also use a good dose of transparency, which is why we should fight back against middle of the night deals that end with massive bills no one has read.
We must continue to fight for legislation that forces Congress to read the bills!
We must continue to object when Congress sticks special interest riders on bills in the dead of night!
And if Congress refuses to obey its own rules, if Congress refuses to pass a budget, if Congress refuses to read the bills, then I say:
Sweep the place clean. Limit their terms and send them home!
I have seen the inner sanctum of Congress and believe me there is no monopoly on knowledge there.
If they will not listen, if they will not balance the budget, then we should limit their terms.
We are the party that adheres to the Constitution. We will not let the liberals tread on the Second Amendment!
We will fight to defend the entire Bill of Rights from the right to trial by jury to the right to be free from unlawful searches.
We will stand up against excessive government power wherever we see it.
We cannot and will not allow any President to act as if he were a king.
We will not let any President use executive orders to impinge on the Second Amendment.
We will not tolerate secret lists of American citizens who can be killed without trial.
Montesquieu wrote that there can be no liberty when the executive branch and the legislative branch are combined. Separation of powers is a bedrock principle of our Constitution.
We took the President to court over his unconstitutional recess appointments and won.
If necessary, we will take him to court again if he attempts to legislate by executive order.
Congress must reassert its authority as the protector of these rights, and stand up for them, no matter which party is in power.
Congress must stand as a check to the power of the executive, and it must stand as it was intended, as the voice of the people.
The people are crying out for change. They are asking for us to hear their voices, to fix our broken system, to right our economy and to restore their liberty.
Let us tonight let them know that we hear their voices. That we can and must work together, that we can and must re-chart our course toward a better future.
America has much greatness left in her. We will begin to thrive again when we begin to believe in ourselves again, when we regain our respect for our founding documents, when we balance our budget, when we understand that capitalism and free markets and free individuals are what creates our nation’s prosperity.
Thank you and God Bless America.”
Joint Chiefs are telling Congress reductions in military strength could begin as soon as sequestration starts on March 1.
Defense Secretary Leon Panetta is leaving Washington after more than four decades, including as a congressman, federal budget director, White House chief of staff and CIA director who oversaw the operation that killed Osama bin Laden.
Defense Secretary Leon Panetta is leaving Washington after more than four decades, including as a congressman, federal budget director, White House chief of staff and CIA director who oversaw the operation that killed Osama bin Laden.
Spending Daily | February 6, 2013
“The Budget War Is Back”
Roll Call reports, “The nation’s brief respite from the serial budget battles that have consumed Washington, D.C., is officially over, with President Barack Obama’s Tuesday demand for new tax revenue in a short-term deal to avoid automatic spending cuts at the beginning of March. In an appearance in the Brady Press Briefing Room, Obama once again tried to use the bully pulpit to paint the GOP into a corner, using the same fairness playbook that helped him win re-election and a victory on tax rates during the fiscal-cliff deal. This time, the scale may be smaller but the game is the same — in the president’s eyes, either congressional Republicans agree to more new tax revenue or they will bear responsibility for the economic damage and hundreds of thousands of lost jobs from the sequester taking effect. With the debt ceiling out of the way until May and likely even later, the coming showdown over the sequester is now the main event, albeit one with less of a sense of urgency than a potential default on U.S. government obligations, the fiscal cliff or even an old-fashioned government shutdown.”
CBO Confirms Higher Taxes Won’t Fix Budget Mess
The Wall Street Journal editorializes, “President Obama promised that higher taxes on the affluent would usher in a fiscal golden age, but Tuesday’s annual outlook from the Congressional Budget Office suggests that was, well, fantasy. … The big news is how little difference all this revenue makes in CBO’s deficit forecast. The deficit will fall this year to $845 billion, which is below $1 trillion for the first time in the Obama Presidency. But at 5.3% of GDP, this will still be the biggest post-World War II deficit except for 1983 (a one-time pop to 6%) and Mr. Obama’s previous four years. So despite the record revenue surge, CBO says federal debt held by the public will continue to rise to 76.3% of GDP this year, up from 36.3% as recently as 2007. And then it will stay there for a decade, if you believe in unicorns.”
CBO: Social Security And Healthcare Spending Will Double Over Decade
Reuters reports, “Spending on Social Security and healthcare will double to $3.2 trillion a year over the next decade, threatening a sharp rise in national debt unless Congress acts to avoid the danger, congressional researchers warned on Tuesday. A report from the nonpartisan Congressional Budget Office did not put forth a plan to resolve the long-term imbalance between revenues and spending on retirement and healthcare benefits. But it said that action taken now would help minimize the economic impact of whatever course lawmakers can agree on. … The agency estimated last June that Social Security and federal health programs would account for more than one-quarter of U.S. gross domestic product by 2037 unless laws were changed.”
Lurching From Crisis To Crisis
The Associated Press reports, “Eager to buy time and avoid economic pain, President Barack Obama urged Congress on Tuesday to pass targeted short-term spending cuts and higher taxes as a way to put off sweeping, automatic cuts that would slice deeply into military and domestic programs starting March 1. Obama’s appeal came as Congress’ budget office projected a yearly federal deficit under $1 trillion for the first time in his presidency and as Republicans applied political pressure on the president to submit balanced budgets, pushing fiscal issues back to the forefront in Washington after weeks devoted to immigration and guns.” Gretchen Hamel, executive director of Public Notice, issued the following statement:
“If the Obama administration was so concerned about the sequester they would have spent the last year looking for offsets, instead of making empty promises and trading blame. The ‘we don’t have a spending problem’ mindset that puts budget gimmicks ahead of real solutions is exactly why Americans have been hit with crisis after crisis. This administration has repeatedly used their own failure as political leverage to push for higher taxes, so why would this time be any different?”
Snowballing Debt Interest to Overtake Defense Spending by 2020
POLITICO reports, “Behind the fine print of new budget estimates released Tuesday is a growing — some say brutal — competition between discretionary spending by Congress and fixed interest payments owed on the growing government debt. Indeed, the steady increase in annual interest costs is a surprisingly big reason why the Congressional Budget Office sees deficits rising in the second half of the coming decade. Accumulated interest payments from 2014 through 2018 are $1.76 trillion under CBO’s new baseline. Interest payments for the second five years are more than double that or about $3.64 trillion. … The end result is that annual interest costs are predicted to have overtaken defense spending by 2020 even allowing for an extra $100 billion annually for overseas contingencies.”
CBO Anticipating “turbulence” in New Health Care Law’s First Years
The National Journal reports, “The Obama administration has been publicly upbeat about the coming rollout of its health care law. But a new report from the nonpartisan Congressional Budget Office suggests that at least one set of influential observers anticipates some turbulence in the law’s first years. On several important measures of the law’s success, CBO’s numbers are pessimistic compared with earlier estimates: Fewer uninsured people will get coverage, insurance options will be more limited, and more employers will stop covering their workers. Perhaps most noteworthy, the report suggests that the new health insurance marketplaces set to launch later this year are unlikely to be completely ready in time. … [T]he report signaled CBO officials are worried that key provisions of the law are not going to work as intended.”
“Analysis: Obama, GOP disagree, again, on spending”
The Associated Press reports, “After two tumultuous years of budget brinkmanship, President Barack Obama and Republicans in Congress finally agree on something — namely, that a previous 10-year pact to cut $1 trillion across the board was such a bad idea it must be stopped before it starts. If consensus counts as good news in an era of divided government, consider this: They also disagree vehemently on a suitable replacement. As a result, they seem likely to spend the spring and perhaps a good part of the summer struggling to escape a bind of their own making. And this time, Medicare and the rest of the government’s benefit programs are likely to face changes. … Obama called on Congress on Tuesday to join him in developing a replacement for the across-the-board reductions, ‘a balanced mix of spending cuts and more tax reform.’ ’We can’t just cut our way to prosperity,’ he told reporters at the White House.”
Washington Post: Time for President Obama to Take the Lead
The Washington Post editorializes on President Obama’s short-term proposal to delay the sequester, writing, “What was missing were specifics: Exactly what would Mr. Obama put in the ‘smaller package of spending cuts and tax reforms’ that he proposes? He doesn’t want to present a detailed plan before the GOP agrees to deal on his terms. House Speaker John A. Boehner (R-Ohio) doesn’t want to talk about a short-term deal that includes any new revenue. … In its [CBO's] latest report on the nation’s fiscal health, the nonpartisan office reported that deficits will decline through 2015. But an aging population and rising health care and interest costs will propel the national debt higher soon thereafter, to 77 percent of the economy by 2023 — and rising. This would have ‘serious negative consequences,’ the office noted — which is putting it mildly, and yet another reason for Mr. Obama to take the lead.
CBO: 2013 Deficit to Fall to $845 Billion
The Hill reports, “The federal budget deficit will fall to $845 billion in 2013 before rising again over the next decade as an aging population and soaring healthcare costs lead to an explosion in entitlement spending, the Congressional Budget Office reported Tuesday. The budget deficit would fall below $1 trillion under President Obama for the first time in 2013 and would drop to $430 billion by 2015, according to CBO’s annual fiscal outlook. But CBO’s long-term forecast projects that budget deficits will near the $1 trillion mark again by 2023, when it forecasts a $978 billion budget deficit.”
“VA Spends $273 Million On Glitchy Digital System”
The Washington Guardian reports, “VA’s effort at digitizing paperwork is so badly bungled that veterans’ claims are taking four times longer to fill out, investigators find. The Veterans Affairs Department has spent $273 million trying to go from paper to digital claims, but it’s off to a bumpy start. In fact, veterans claims sent digitally are being processed more slowly than the traditional way. That’s the finding of a new investigative report by the VA’s inspector general that provides a stark looks at the flaws in a project that was supposed to speed, not slow, veterans’ benefits. … The program so far has cost $273 million, and officials said they plan to spend an additional $92 million by October.”
Obama’s “Campaign-First, Negotiate-Second” Strategy
Carrie Budoff Brown writes in POLITICO, “President Barack Obama’s speeches have a familiar ring these days … Tout what he’s already done. Say the public’s in his corner. Demand Congress do something. Lament Washington dysfunction. Lay out his own plan. Avoid details. Urge voters to keep up the pressure. Warn it won’t be easy. Bask in the applause. … The campaign-first, negotiate-second strategy worked when Obama pressured Congress to extend the payroll tax cut in 2011, avert an interest rate hike on student loans in 2012 and eliminate the Bush-era tax cuts for wealthier families. But none were as politically fraught as overhauling immigration, cutting entitlements or establishing new gun restrictions. His remarks Tuesday on the need to avert the automatic, across-the-board spending cuts known as the sequester underscored the extent to which his pitch has become predictable, even formulaic.”
Post Office to Stop Saturday Mail Service
USA Today reports,” The financially struggling U.S. Postal Service says it plans to stop delivering mail on Saturdays, but it will continue deliveringpackages six days a week. In an announcement scheduled for later Wednesday, the government agency is expected to say the cut, beginning in August, would mean a cost saving of about $2 billion annually. Over the past several years, the Postal Service has advocated shifting to a five-day delivery schedule for mail and packages — and it repeatedly but unsuccessfully appealed to Congress to approve the move. Though an independent agency, the service gets no tax dollars for its day-to-day operations but is subject to congressional control. It was not immediately clear how the service could eliminate Saturday mail withoutcongressional approval.”
President Obama proposed the sequester, insisted his sequester become law, and then doubled-down on keeping his sequester in place – even vowing to veto any efforts by Congress to replace it – until today. Why the about-face, Mr. President? House Republicans have already passed two bills to replace the arbitrary cuts in President Obama’s sequester with responsible spending cuts and real economic reforms to create jobs and prosperity for all Americans.
Watch and share the new video from the House Republican Conference.
President Barack Obama is asking Congress to come up with tens of billions of dollars in short-term spending cuts and tax revenue to delay automatic spending cuts scheduled to kick in March 1.