Because the U.S. Congress and White House were unable to reach a budget deal, President Obama had to sign off on sequestration, meaning numerous automatic spending cuts. This issue is basically a self-imposed crisis Congress created for itself when it couldn’t reach a long-term fiscal cliff deal in the last Congress. Perhaps Democrats were naive in thinking the GOP would never allow deep spending cuts to the Pentagon, but here we are, half a week after the sequestration deadline passed, and still no solution. The impact of sequestration will most likely be felt starting in the beginning of April. There will be longer lines at airports, since TSA funding will be slashed. There will be fewer flights, since there also be fewer air traffic controllers. Teachers will be laid off. States will lose federal funding for police and firefighters. And the list goes on.
The impact of sequestration is already being felt here in northeast, Pennsylvania. The Wilkes-Barre-based paper, The Citizens’ Voice, has a front page story today that Tobyhanna Army Depot, one of the largest employers in the region, is set to unveil $309 million in budget cuts, resulting in the furloughs of 5,136 civilian employees. According to the article, “Facility managers and the unions are working on the details of the furlough, in which the 5,136 employees will be required to take 22 non-consecutive furlough days between late April and Sept. 30 unless the federal budget impasse in Washington, D.C., is solved.”
What’s especially alarming is that Congress has more impending deadlines, including the debt ceiling. This week, House Speaker John Boehner said something needs to be done to ensure there is not one crisis after the other. However, I am skeptical he will get his Congress and its Tea Party wing to really pass a long-term plan that has the support of some Democrats and avoids another self-imposed crisis. This sequestration and the failure to resolve it has only increased tensions on the Hill.
Ironically, the stock market broke a record yesterday, as the Dow Jones soared to an all-time high. Since 2007, corporate profits have been skyrocketing, but job creation remains dismal and the unemployment rate remains stuck at 7.8-8 percent. Meanwhile, if this sequestration issue is not resolved, then middle and low-income workers will be hit the hardest, as evidenced by the article today in The Citizens’ Voice.