News

Washington’s Budget Woes

What is the sequester, and how will it affect the nation?

March 04, 2013
SAUL LOEB—AFP/GETTY IMAGES

President Obama responds to media questions during a press conference regarding the sequester on March 1, 2013.

Sequester (seh-kwes-ter). You may have heard this term in the news. What does it really mean? And how will it affect Americans? “To sequester” means to remove or give up for safekeeping. Because of a law written in 2011, on March 1, 2013, $85 billion in automatic cuts to the nation’s budget went into effect. That’s the sequester.

House Speaker John Boehner of Ohio answers questions about the automatic spending cuts.

CAROLYN KASTER—AP
House Speaker John Boehner of Ohio answers questions about the automatic spending cuts.

Dollars and Sense

The sequester began because lawmakers could not reach an agreement on how the government should cut spending and stick to a budget. Like families, the government sets and maintains a budget. The federal government brings in money through taxes and loans. It uses that money to pay for services and programs, which range from national parks preservation and health care to maintaining the country’s defenses.

For years, the government has been spending more money than it takes in. Both President Barack Obama and Republican leaders in Congress agree that the government needs to reduce the deficit, or money it owes. But they disagree about how to do that, how fast and by how much. Republicans believe slashing government costs will relieve the deficit. Democrats are in favor of tax increases. The sequester was intended to force both sides to find common ground.

In 2011, lawmakers passed the Budget Control Act. The law said that if Congress and the White House could not agree on a deal to cut government spending, automatic cuts would take effect. A temporary compromise on New Year’s Eve postponed the cuts until March 1, 2013.

Making Cuts

Last Friday, the President and Congressional leaders met to try to come up with a budget deal. They have until March 27. If no deal is struck by then, non-essential government services will be cut, adding to the woes brought on by the sequester.

“The White House may not want to admit it, but the American people know that government has a serious spending problem,” Republican House Speaker John Boehner said in a statement after Friday’s meeting. “They also know that if the President gets more tax hikes, he will just spend it.”

For now, Americans will slowly begin to feel the sequester’s pinch. Some things will not be cut by the sequester, including food stamps, Social Security and military paychecks. But national parks services, food-safety programs, disaster relief and special-education and health programs could be hurt. "This is not a win for anybody,” said President Obama in a statement. “This is a loss for the American people."


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