U.S. Republicans think they have nothing to lose from the sequestration. But nobody knows what the effects of the federal agencies’ spending cuts will be. Will it be chaos? Or will it be bearable? Your guess is as good as mine.
Until we have the answer, Republicans do have something to lose: the credibility of their own argument for spending cuts.
The sequestration is designed to hurt. Federal agencies have little flexibility in how the cuts are administered. Only a few have made longer-term plans for how they’ll manage. The result is a bunch of cuts that will create disproportionate disruption in the normal functions of government, and that can't plausibly be permanent.
Republicans hope to convince the public that the U.S. can make substantial cuts in federal spending. Showing them that the first incision leads to furloughs of air traffic controllers, for example, is precisely the wrong way to do it. What's worse, from the party's point of view, is that the cuts won't stick. Furloughs are not a real plan to reduce government spending.
Sunday, March 3, 2013
The GOP's Stake in the Sequester
In Bloomberg, I explain what Republicans have to lose in the sequester:
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True and, by definition, the Dems have the same problem. If the Sequester really sticks through, but doesn't manage to bother many Americans in a significant way, they'll come to the conclusion that this "big" meat-cleaver isn't so bad after all.
ReplyDeleteThis will severely dampen efforts to invest in infrastructure today, when we can borrow at negative rates. Indeed, to the extent that most of our deficit is cyclical, there will be the worse misperception that any increases in private activity etc. come from the government not "crowding out" the economy.
It's a shame. We have every reason to be scared as hell about our balance sheets in twenty years. And we have almost no reason to be scared about them today or tomorrow.
Regardless of how the sequester plays out, one side or the other will manipulate the effect to their own agenda.
Politics are brutally path dependent.