Don’t Abandon the Sequester

Republicans aren’t the dumbest politicians there are, but they’re in the running… Especially if they lose this advantage.
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The way the budget showdown is going, Democrats may soon require the Republicans to pay ransom before they’ll allow the GOP to reopen the government and raise the debt ceiling. That’s how badly the party’s Ted Cruz faction has messed up the politics of all this. But we sure hope part of that price won’t be to abandon the budget caps that are the only restraint on President Obama’s spending plans.

Democrats hate the spending caps and sequester because they squeeze their pet domestic programs, and two recent reports illustrate how much. The Congressional Budget Office’s latest monthly update, for the first 11 months of fiscal 2013 through August, shows that total federal outlays are down $127 billion over the same period last year. This means that when the report comes in for the full fiscal year overall federal spending may have fallen two years in a row for the first time since the end of the Korean War.

Meanwhile, the Congressional Research Service has released a new report that shows the sequester caps are providing better fiscal discipline than any budget deal has since 1980. The report looked at nine major deficit reduction deals and concludes: “In nominal (i.e., not adjusted for inflation) terms, the Budget Control Act achieves the greatest amount of deficit reduction of any act since 1980 over five years, based on the estimates produced near the time of enactment where five year totals are available.”

Adjusting for inflation, the report finds that the Budget Control Act’s estimated deficit reduction over five years will be second only to the 1990 George H.W. Bush-George Mitchell deal. The Bill Clinton package of 1993 that liberals love came in third.

Keep in mind that a little less than half of all the deficit reduction in 1993 and about 40% in 1990 came from tax increases. The 2011 Budget Control Act is reducing future deficits through spending cuts alone. This means the current sequester isn’t hurting economic growth by reducing incentives to save and invest.

As for the politics of the sequester, a poll released last week finds that the sequester cuts of roughly 5% across the board (about 8% in defense) have barely been noticed by most Americans. The United Technologies-National Journal poll asked: “Have you seen any impact of these cuts in your community or on you personally since they took place, or not?” Seventy-four percent said they’d seen no impact, while 23% said they had.
The harm that President Obama predicted in January, and that Democrats keep claiming, simply hasn’t appeared. This polling on the sequester is a lot better for Republicans than the blame they’re getting for the shutdown.

It would be better government if Congress could set spending priorities, and defense spending in particular can’t keep falling without harming U.S. security. Many Senate Republicans would like to abandon the sequester to spend more on defense or go back to allocating domestic pork.

But the sequester is the only leverage that Republicans have in any negotiation with President Obama once the debt ceiling is inevitably raised and the partial shutdown ends. If Republicans abandon the sequester now as the price of reopening the government, they will be back at the same old stand of Mr. Obama insisting on another tax increase in return for any entitlement reform. It would turn a political retreat into a policy rout

Review & Outlook: Don’t Abandon the Sequester – WSJ.com.

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