Washington Matters


Where the Sequester Cuts Will Fall

Kenneth R. Bazinet

You can see, dollar-by-dollar, where $85 billion will be sliced out of the Federal budget this year.



After months of general warnings about the impact of automatic budget cuts on the federal government, the White House is spelling out reductions, dollar for dollar, across all agencies and departments.

See Also: How Uncle Sam Spends Your Tax Dollar

The lengthy document, posted by the White House, offers the first detailed look at the automatic cuts, and it's not pretty. "The cuts…will be deeply destructive to national security, domestic investments, and core Government functions," says Office of Management and Budget Deputy Director Jeffrey Zients.

According to an analysis from the OMB, the $85-billion slashing of programs for the fiscal year that ends Sept. 30 will include the following:

--About $2 billion from the Transportation Department, including more than $500 million in recently approved emergency aid to help communities in New York and New Jersey recover from Hurricane Sandy.

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--Nearly $8 billion from operating funds for the Army ($4.6 billion) and Navy ($3.4 billion).

--Some $900 million from loan programs for small businesses, from the Small Business Administration and other programs.

--About $400 million from the Federal Aviation Administration.

The cuts will also reduce day-to-day enforcement activities by the FBI, the Border Patrol and other law enforcement agencies by the hourly equivalent of more than 1,000 agents, the document states.

Most of the cuts and any resulting furloughs of federal workers will start April 1.

Kiplinger forecasts the cuts, if not softened by Congress, are expected to reduce U.S. GDP growth by about six-tenths of a percentage point this year and cost hundreds of thousands of jobs. The automatic cuts, also called a sequester, are designed to last a decade and lower total government spending by about $1.2 trillion. They do not apply to spending that is required by law, including entitlement spending, and some programs that have been spared by Congress, such as health care for veterans.



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