In addition to the upcoming sequestration and May’s debt limit negotiation, there is another fiscal crisis coming up that — unlike the sequestration and debt limit — could actually force a government shut down. By March 27, Congress must vote on a new continuing resolution that will appropriate money to continue the funding the government.
If that doesn’t happen — or if negotiations hit an impasse — the government will shut down.
Last week, Senate Budget committee chair Patty Murray sent a letter to her Democratic colleagues detailing the upcoming fights that Congress is slated to have over the next several weeks.
In the memo, Murray notes that as it stands, the current continuing resolution — a “CR,” or the bill that funds the government in the absence of a full omnibus spending bill — expires on March 27, and unless Congress acts to appropriate funds by that date the government will face a full shutdown.
A government shutdown could have a devastating impact on our still-recovering economy and cut off access to social security for new filers, loans for small business owners and families trying to buy a home, food-safety inspection, and so many other programs that families and seniors across the country count on.
Essentially, Congress needs to pass a bill appropriating either another full year of funding or another continuing resolution for 2013.
If not, federal employees will be furloughed and government spending will be cut off or reduced.
Republicans have demonstrated a willingness to see the government shutdown to get cuts, and it’s possible that they will use the threat of shut down this time around. In fact, a recent poll found more than half of Republican respondents were willing to shut the federal government down as a negotiating tactic to score spending cuts.
In addition to a potential shutdown, there’s a second issue that needs to be settled by the 27th: The so-called “little sequester,” which could slam all defence and security aspects of government with across the board spending cuts of $7 billion.
The Budget Control Act — BCA — that ended the 2011 debt ceiling fight limited overall funding to $1.04 trillion, capping defence funding at $546 billion and non-defence funding at $501 billion. Exceeding the limit in either category triggers automatic across-the-board cuts.
The American Tax Relief Act — ATRA — switched the categories from defence/non-defence to security/non-security and reduced the overall 2012 BCA spending limit by $4 billion.
As a result, the current funding level for security in 2013 exceeds the ATRA limit for the category — which involves all military, homeland security, and other security funding — by $7 billion.
Unless Congress aligns appropriation levels within the security category to be lower than the ATRA limit, a full $7 billion security sequester will be triggered and automatic cuts go into place for each and every program.
As explained by Senate Budget Committee Majority Press Secretary Eli Zupnick:
When Congress extends the current CR, it will either have to alter the CR’s spending rate so that the new CR complies with the new security/non-security firewalls OR further delay “little sequester”. If Congress were to simply extend the current CR with no changes but fail to delay the date by which OMB must determine whether a sequester is in order, then security would face a $7 billion sequester.
Essentially, Congress needs to eliminate $7 billion worth of security spending. Either they can find specific programs to target and reduce, delay the crisis, or slow the rate of spending. Otherwise, every security program would face a cut.
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