Navigating The Sequester: The Fight Over How To Avoid Draconian Spending Cuts

President Barack Obama, accompanied by emergency responders, a group of workers the White House says could be affected if state and local governments lose federal money as a result of budget cuts, gestures as he spea... President Barack Obama, accompanied by emergency responders, a group of workers the White House says could be affected if state and local governments lose federal money as a result of budget cuts, gestures as he speaks in the South Court Auditorium in the Eisenhower Executive Office building on the White House complex in Washington, Tuesday, Feb. 19, 2013. MORE LESS
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Where the media succeeds at not letting politicians shirk responsibility for the sequester’s existence, it fails miserably at explaining and evaluating the two parties’ positions on what to do about it.

That failure isn’t entirely because news organizations are confused by the various plans to replace it. It’s also because the story of the sequester’s origin is coincidentally well served by the assumption that Democrats and Republicans are equally to blame for the country’s problems, while the story of the current impasse is not.

But the parties’ negotiating positions and substantive proposals aren’t particularly confusing. And unlike the fake fight over who’s to blame for creating the sequester, explaining and adjudicating the fight over how the parties would like to avoid the sequester is actually illuminating — at least inasmuch as it’s not just a cynical exercise in reverse engineering the conclusion that everyone’s being equally unreasonable.

The GOP position on the sequester amounts to the following: The sequester is terrible, and will hollow out the U.S. military, but replacing it with any plan that includes even modest new tax revenues would be worse. They’re insisting, hopelessly, that Democrats agree to a cuts-only baseline for sequester replacement negotiations. Last year House Republicans passed two bills that would buy down the sequester largely with cuts to safety net programs for the poor. But those bills expired at the end of the 112th Congress, and now, with their majority diminished, it appears they can no longer muster support within their conference for similar legislation this year. To obscure that setback they’ve made a point of trumpeting their own expired achievements and placing the onus on Senate Democrats to move legislation of their own.

Democrats aren’t being anywhere near as stubborn as declaring one half of the ways and means equation off limits. Their view is that the sequester is terrible; they’re open to a number of different alternative policies; but they won’t negotiate entirely on Republican terms. Their only overarching demand is that any final plan to replace or pay down the sequester include some revenues — half the total amount of deficit reduction, possibly even less. The rest can come from cutting spending.

For many reasons, Senate Democrats didn’t pass a sequester replacement bill last year. Nothing the Democratic caucus would have supported could have survived a GOP filibuster, and despite backbench efforts to build consensus around broader deficit reduction plans, Democratic leaders opted to let the election forge a path around the country’s lingering budget impasses. Now that the sequester is a week away, Democrats in both the House and Senate have introduced bills to pay down the sequester for about a year. The proposals are broadly similar — both would require millionaires to pay an effective tax rate of 30 percent and cut agriculture subsidies.

President Obama, likewise, has a framework for replacing the entire sequester. Obama wants to pick up where he and House Speaker John Boehner left off late last year when the two men once again failed to reach a broad budget deal. When those negotiations fell apart, Obama had just offered Boehner $900 billion in spending cuts in exchange for $1.2 trillion in new revenues — some from raising marginal income tax rates, and some from limiting tax expenditures for wealthy Americans. Obama banked about half of those revenues in January, and he now proposes subtracting those revenues from his final offer to Boehner and using the difference as a full sequester alternative.

Republican leaders reject these approaches because they include more than zero dollars in new revenues. And that’s why both parties expect the sequester will be ordered on March 1.

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