July 18, 2012
With Senate leadership locked in a fight over taxes, a small group of Republican and Democratic senators, local politicians and outside groups are trying to stress just how devastating a $1 trillion across-the-board budget cut would be to the nation’s economy.
The reduction to the federal budget is set to take place unless Congress agrees to reduce the federal deficit by $1.2 trillion or passes a law replacing one already on the books.
A group of senators is trying to do just that by building support for buying back one year of the penalty known as sequestration with spending cuts and tax increases.
But Sen. Carl Levin (D-Mich.), the chairman of the Senate Armed Services Committee, acknowledges that although he is talking with colleagues about the idea, he has not yet discussed it with leadership. And asked whether congressional leadership supports the idea, Sen. Lindsey Graham (R-S.C.) says it will require pressure from the public. “We’re trying to build pressure outside to get people within the body to act,” Graham says.
The Aerospace Industries Association is standing ready to amp up that pressure.
The group’s Second-to-None lobbying campaign against the budget cuts released a study by George Washington University’s Stephen Fuller on July 17 claiming that the penalty will slash 2.14 million jobs, reduce the nation’s gross domestic product by $215 billion and push the unemployment rate above 9%.
San Diego Mayor Jerry Sanders came to Washington to discuss the study, saying that as the mayor of the state’s second-largest city — one that relies on $32 billion in defense spending per year — he did not have a choice. Sequestration would not just cut into the defense sector, but reductions in federal funding for Customs and Border Patrol could further hurt the nation’s busiest land-border crossing and hurt trade at San Diego’s port, which processes 1 million tons of cargo annually.
In all, California stands to lose 225,464 jobs to sequestration due to cuts inside and outside of the Department of Defense (DOD), according to Fuller’s report, “The Economic Impact of the Budget Control Act of 2011 on DOD and Non-DOD Agencies.”