There’s plenty of talk about the “fiscal cliff” — which was avoided by a last-minute deal last month — but that only delayed a huge Pentagon fear: Sequestration.What happens if the military is slapped with sequestration — automatic budget cuts to the tune of about $500 billion over 10 years?
The defence Department is the biggest loser in the latest budget battle, and although Secretary of defence Leon Panetta is hopeful about reaching an agreement, they still need to plan for the possibility, which left unchecked would hit in March.
“Indeed, we are seeing the formation of what I would call a perfect storm of budget uncertainty,” Panetta said on Jan. 10. “With a sequester that could happen on March 1st, a continuing resolution that could simply be extended for the rest of this fiscal year, as opposed to having a defence appropriations bill adopted, and, thirdly, a debt ceiling crisis that could create even further turmoil that could impact on our budget and on our economy.”
“And the fact is, looking at all three of those, we have no idea what the hell’s going to happen.”
The guidance from the Pentagon to all service branches is to give specific recommendations on what they can cut by Feb 1st. Here’s the broader view from Panetta on what would happen if Congress does not act to avoid the sequester.
Civilian contractors would face serious cutbacks. The centre for Strategic and Budgetary Assessments estimates about 108,000 defence civilian employees could lose their jobs in 2013 if sequestration hits.
They've already frozen civilian hiring, delayed certain contracts, and cut back on facilities maintenance.
All programs administered by the Department of Veterans Affairs, as well as the military's wounded warrior programs, would also be exempt, according to Cornell University Law School.
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