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Seantor Grassley Q&A on the Sequester

February 15, 2013
Chuck Grassley - Senator , Traer Star-Clipper

Q: What exactly is sequestration?

A: Sequestration is a process of automatic, largely across-the-board permanent spending reductions. The process was created in 1985 in the Gramm-Rudman-Hollings Act. More recently, Congress included sequestration as an enforcement tool in the Budget Control Act of 2011. The automatic spending cuts established in the 2011 law are scheduled to begin this year on March 1. Totaling $1.2 trillion over a ten-year period, half the cuts are allocated to defense, and half the cuts are spread among non-defense programs of the federal government. A number of programs are exempt, including Social Security and Medicaid, refundable tax credits to individuals, low-income programs such as the Children's Health Insurance Program, Supplemental Nutrition Assistance Program, Temporary Assistance for Needy Families, Supplemental Security Income, and all programs administered by the Department of Veterans Affairs. I voted against the plan in 2011 because it accompanied an enormous expansion in government debt, delayed meaningful long-term spending reductions, and left open the possibility of tax increases.

Q: Do you share concerns that the defense cuts will be too deep?

A: The Armed Services Committee in the U.S. House of Representatives has analyzed the impact of the scheduled sequestration and found that the cuts would reduce the U.S. military to its smallest size since before World War II. President Obama's Secretary of Defense, Leon Panetta, said this month that letting the sequester go into effect would be "shameful and irresponsible" and it would "damage the readiness" of the United States. In carefully limiting the powers of the federal government, America's founders made clear that the federal government's primary purpose was defense and national security. By remaining strong enough to deter possible aggression, the U.S. military provides stability and peace. No doubt spending reductions are necessary from every part of the federal government, including defense, and not one dime more than necessary should be spent. I've got a long history of conducting oversight of Pentagon waste, fraud, and abuse in order to make sure defense dollars are spent wisely. However, the budget for the Department of Defense makes up 20 percent of the federal budget, and the sequester has it absorbing 50 percent of the cuts. The scheduled sequester will result in massive across-the-board defense spending reductions without allowing for strategic, national security guided re-adjustments. The sequester comes on top of $487 billion in savings over 10 years now being implemented by the Pentagon, including $45 billion in the current fiscal year.

Q: What are the chances of Washington changing the plan?

A: About the 2011 law that he signed, President Obama said the sequester was a "forcing mechanism." In response to broad-based support for an alternative approach to spending reductions, the House of Representatives twice passed legislation in 2012 to replace the across-the-board cuts of the sequester with other spending reforms to achieve necessary budget savings. At this point, the Senate Majority Leader has not responded to efforts to work on a plan for alternative spending reductions. On the campaign trail last year, President Obama said the cuts "will not happen," but he has not proposed an alternative to the sequester. Above all, it is time for Congress and the President to focus on the spending discipline needed to restore confidence among investors and job creators. In 2009 and 2010, non-defense discretionary spending increased by 24 percent, and record level government spending didn't fix record-level unemployment. In addition, long-term reforms to Medicare and Medicaid are needed to save the programs and make them sustainable. You can't raise taxes high enough to fix these problems and create an environment for a strong economy.



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