Threat of Sequestration

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The House of Representatives resumes debate tomorrow on the energy and water appropriations bill which covers nuclear weapons and the non-proliferation program of the National Nuclear Security Administration.

Amendments will be discussed on the floor in the long haul towards finalizing the fiscal year 2013 defense bill. But as the debate goes on, in the corridors of Congress and increasingly in the U.S. media there is mounting criticism of the delays by Congressional leaders in tackling the debt crisis. Unless Congress reaches agreement on $500 billion in cuts to the defense budget, sequestration will kick in from January next year. That means automatic cuts across the board of the same amount in defense spending between 2013 and 2021.

One issue which has become a distraction in recent days is that of a proposed East Coast missile shield. House Republicans are calling for creation of the shield by the end of 2015 in language approved by the full House on May 18. The measure calls for an initial $100 million to be set aside to plan for the site, while billions would be required later.

Democrats seem at a loss to stop the House steamrolling over their cutting amendments. The House National Defense Authorization Act contains $554 billion for national defense – roughly $4bn above President Obama’s request. It is expected that the Democrat-controlled Senate would strip out some of the spending, but final agreement may not come until the lame duck session following the November 6 election. Some lobbyists are predicting a “legislative hurricane” after the elections.

Conventional wisdom in Washington is that on the debt crisis too, Congressional leaders will take no action until the lame duck session. Last week, during an Asian tour, Defense Secretary Leon Panetta attempted to reassure allies that Congress had created an “artificial crisis” and would find its way out.

But the Pentagon’s chief budget officer, Ashton Carter, was ringing alarm bells in Washington at the same time. He warned that automatic cuts would disrupt “thousands of contracts and programs” in the military.

Congressional aides say they can’t see any change in fundamental positions since the failure of the bipartisan Super Committee on deficit reduction which essentially kicked the can down the road in November last year. Many Republicans remain adamant that they will not contemplate tax increases, while Democrats are equally implacably opposed to cuts in social welfare programs. Some analysts say that if Congress can’t reach agreement in the lame duck session, the legislature could always postpone the sequestration deadline still further.

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