As I imagined it earlier this month, the sequester offered Republicans a chance to reset budget negotiations with the White House. The debt ceiling battle, with its specter of global financial crisis, had been set aside. There were renewed qualms about the pace of economic recovery. Moreover, the president seemed eager to move beyond the impasse of fiscal politics and begin piecing together a second-term legacy.
“If they’re smart, [Republicans] will husband this leverage wisely and press for modest measures to rein in spending over the long haul,” I wrote.
Needless to say, it hasn’t worked out that way at all. It turns out the leverage that the sequester represents is worthless if, as Justin Green of the Daily Beast notes, spending cuts-and-spending-cuts-only is the default bargaining position. (The idea that the terms of the original debt-ceiling truce oblige both parties to an all-cuts replacement for the sequester, as Bob Woodward charges, doesn’t quite pass the smell test. Recall that House GOP leaders floated Erskine Bowles’s testimony before the debt-reduction supercommittee as a framework for a fiscal cliff compromise. That sequester replacement, such as it was, called for $800 billion in new revenue. The GOP has every right not to compromise with Obama on taxes this time—but the “goal posts” in this case dictate only the “how much,” not the “how” of deficit reduction.)
As things stand now, the sequester is almost certain to kick in (although its effects may not be fully felt until later in March, when funding authorized under last year’s continuing budget resolution runs out). Unless the administration beats a dramatic retreat, Republicans will not secure anything in the way of Medicare or Social Security reform without also agreeing to roughly $600 billion in new revenue captured from tax loopholes and deductions.
But, damn the torpedos, they will have their sequester cuts.
It’s worth asking what is the upside of these cuts.
Will they meaningfully reduce the deficit?
By proponents’ own reckoning, they will not.
You can’t simultaneously allay fears about the sequester—“Calm down; these are pissant reductions in the rate of growth”—and then congratulate yourself for reining in spending.
Will the insistence on moving ahead with the sequester favorably impress voters? Again, no. By more than three-to-one, according to a Washington Post/Pew poll, the public believes the sequester will be a drag on the economy—and 45 percent will blame Republicans for it (versus 32 percent for President Obama).
For the last two months, I’ve heard variations on the argument that if the sequester is the only cuts that Republicans can impose on the Obama administration, then, by golly, we’ll take them. This, despite the fact that the politics are moderately bad to terrible, and, on the merits, the sequester stands to ding the economy in the short term without doing anything to address the real drivers of long-term debt: healthcare entitlements.
There’s a word for this kind of thinking.