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CONGRESS IS DOING NOTHING ABOUT THE SEQUESTER

Ezra Klein's Wonkbook

Feb. 26, 2013

Welcome to Wonkbook, Ezra Klein and Evan Soltas’s morning policy news primer. Send comments, criticism, or ideas to Wonkbook at Gmail dot com. To read more by Ezra and his team, go to Wonkblog.

Wonkbook’s Number of the Day: $150,000. That’s the amount Washington gives to more than 80 local, ultra-low-traffic airports every year. It’s important to keep in mind that the sequester is a “dumb cut.” It will hit ostensibly “smart” programs and public priorities. It won’t eliminate waste or reform programs to be permanently more cost-efficient. It’s designed to be a bad idea.

Wonkblog’s Graphs of the Day: The states most and least affected by the sequester, and Oscar speeches have doubled in length.

Wonkbook’s Top 5 Stories: 1) The sequester debate isn’t budging; 2) an early vote on the assault-weapons ban is two days away; 3) GDP may have grown in the fourth quarter, after revisions; 4) Medicaid reform making huge progress; and 5) the mess of an Italian election.

1) Top story: Congress is doing nothing about the sequester

Congress is back. But working on the sequester? Not so much. “Congress has officially returned to business after a week-long recess, but there is no new sign of serious negotiations to avert sequestration on Friday…[P]arty Senate leaders plan to advance competing sequestration measures on Wednesday. By unanimous consent, both sides have agreed that either measure would need 60 votes to proceed, meaning that each measure is bound to fail.” Rosalind S. Helderman in The Washington Post.

@Goldfarb: One of biggest ironies of sequester is it cuts deeply into gov’t programs that aren’t major drivers of future deficits.

Obama turns to public for leverage. “President Barack Obama, long accused of keeping Congress at arm’s length, is focusing even more intently on working around lawmakers rather than with them as he pursues his second-term agenda…On this and other issues, Mr. Obama has adopted a strategy of using his platform to try to build a public consensus that will compel lawmakers to act. Through a variety of executive actions and a campaign aimed at winning the battle for public opinion, the president has made clear he would like lawmakers’ help, but will proceed without it.” Colleen McCain Nelson and Eric Morath in The Wall Street Journal.

Explainer: Brookings wants to revamp the budget. Here are its 11 best ideas. Dylan Matthews in The Washington Post.

On spending cuts, focus is shifting from “if” to “how.” “With across-the-board federal spending cuts likely to begin Friday, a growing question is how much discretion the Obama administration has to soften their blow…The answer to how much the administration can control what exactly is cut may not be known until the deadline hits and agency heads begin making adjustments to live within the tighter budgets.” Peter Nicholas and Damian Paletta in The Wall Street Journal.

Explainer: The Pew Center has put together a “pain gauge” to measure the state-by-state impact of sequestration.

House Republicans aren’t worried about the impact. “House Republicans have a message for President Obama: If you want to avert the sequester, stop calling us, and start calling Senate Democrats. Speaking at a news conference as they returned from a week-long recess, House GOP leaders added to a chorus of Republicans skeptical of the warnings issued by the White House in recent days about $85 billion in federal spending cuts affecting government operations and the American economy.” Ed O’Keefe in The Washington Post.

…And the GOP is pushing back against Obama’s pressure. “Republicans on Monday rejected President Obama's high-pressure push to avert a series of budget cuts called the sequester, saying that Obama is engaged in scare tactics and political campaigning when he should be seeking a deal.” David A. Fahrenthold and David Nakamura in The Washington Post.

@pdacosta: The portuguese verb ‘sequestrar,’ which comes to mind when I hear the term ‘sequester,’ means to kidnap or take hostage.

Some in the GOP want to loosen up the spending cuts. “Congressional Republicans are considering a proposal that would give the Obama administration authority to choose what gets the axe under the automatic spending cuts required by sequestration. The measure is intended to negate the ‘across-the-board’ nature of sequestration while still maintaining the size of the spending cuts, sources said.” Joel Gehrke in The Washington Examiner.

…but Senate Republicans don’t like the idea. “Big Republican names in the Senate warned Monday against giving away congressional power in order to escape responsibility for the adverse impact of automatic spending cuts expected to go into effect Friday. Sens. Marco Rubio of Florida and John McCain of Arizona both expressed strong concerns in anticipation of a party discussion Tuesday on draft legislation to give President Barack Obama greater flexibility to deal with the crisis. By doing so, the leadership hopes to shift the onus onto Obama to administer the cuts, but letting go of power to give the president that discretion is hard to do.” David Rogers and Manu Raju in Politico.

@justinwolfers: Definition of Sequester: When Congress dares itself to do something stupid. And then accepts the dare.

Reduced National Park spending would limit services, says Interior Secretary. “Mandatory federal spending cuts scheduled to begin Friday are already affecting operations at many of the nation's national parks and wildlife refuges…Mr. Salazar's comments and his dire predictions for impacts on the millions of visitors to the nation's 398 national parks and 561 wildlife refuges are part of a concerted administration campaign to pressure Congress to cancel the automatic spending cuts known as sequestration.” John M. Broder in The New York Times.

…And it could hurt border security. “Homeland Security Secretary Janet Napolitano warned Monday that her agency would be forced to furlough 5,000 border control agents under mandatory spending cuts, likely allowing more illegal immigrants into the country and potentially compromising national security.” David Nakamura in The Washington Post.

…And NIH says research will get hurt. “In a call with reporters Monday, Francis S. Collins, director of the National Institutes of Health, said the NIH was bracing for about $1.6 billion in cuts as a result of the sequester, affecting research into such diseases as cancer, influenza and Alzheimer's disease. Hundreds of research grants would go unfunded, he said, and some 20,000 highly skilled workers would lose their jobs. He also expects to have to turn away patients from the NIH's clinical center, which allows people who have exhausted their treatment options to participate in clinical trials.” Sandhya Somashekhar in The Washington Post.

No jets for you, Congress, if the sequester goes through. “Here's what might be the most powerful incentive yet for members of Congress to come up with a deal to avert the sequester: The head of the Air Force warned Monday that the spending cuts that will go into effect March 1 could cause the military to eliminate those lovely miljet flights that lawmakers enjoy. Members of Congress adore flying on Air Force jets, particularly for overseas trips.” Al Kamen in The Washington Post.

@AnnieLowrey: My mom figured the “sequester” meant Obama, Boehner etc. sitting in a room and not leaving until things were sorted, along with cuts. Sigh.

Don’t be fooled, though. There’s still a lot of useless spending. “Along a country road in southern Oklahoma, there is a place that doesn't make sense. It is an airport without passengers. Or, for that matter, planes. This is Lake Murray State Park Airport, one of the least busy of the nation's 3,300-plus public airfields. In an entire week here, there might be one landing and one takeoff -- often so pilots can use the bathroom. Or none at all. Visiting pilots are warned to watch out for deer on the runway. So why is it still open? Mostly, because the U.S. government insists on sending it money.” David A. Fahrenthold in The Washington Post.

Thank the Tea Party for the sequester. “Since the day they were swept to power more than two years ago, the tea party's legions in Washington have made dramatic federal spending cuts the centerpiece of an economic message that has dominated the national debate.Now they're about to get what they want…What unfolds over the following months will be a high-stakes test of whether significant cuts in spending will help or hurt the economy -- and the Republican Party's brand.” Zachary A. Goldfarb in The Washington Post.

@MichaelSLinden: Reminder: since most projections of the deficit already assume the sequester won’t happen, repealing it does not increase the deficit.

THE FINANCIAL TIMES: Washington needs adult supervision. “Mr Obama is right to insist the sequestration be replaced by a more balanced package of revenue increases and spending cuts that would be phased in over a longer period. The US recovery is still too fragile to take this kind of hit in one go…Having conceded tax increases on the very wealthiest - those earning more than $450,000 a year - at the last fiscal cliff in early January, the party is determined it will never happen again. But it will and it should.” The Financial Times Editorial Board.

KLEIN: Why I don’t understand the Republicans’ sequester position. “As I understand it, the GOP has five basic goals in the budget talks: 1) Cut the deficit. 2) Cut entitlement spending. 3) Protect defense spending, and possibly even increase it. 4) Simplify the tax code by cleaning out deductions and loopholes. 5) Lower tax rates. The White House is willing to cut a deal with Republicans that will accomplish 1, 2, 3 and 4. But Republicans don't want that deal. They'd prefer the sequester to that deal. That means they will get less on 1, basically nothing 2, 4, and 5, and they will actively hurt themselves on 3. So, rather than accomplishing four of their five goals, they're accomplishing part of one. Some trade.” Ezra Klein in The Washington Post.

COHN: The sequester is inevitable, so prepare to suffer. “Republicans are arguing the sequester cuts won’t hurt so much. Of course, within a week or two, political rhetoric may matter a lot less than longer lines at airport security, smaller unemployment checks, and other reminders that less government spending also means fewer government services.” Jonathan Cohn in The New Republic.

CILLIZZA AND BLAKE: Why we need the sequester. “[W]e are disputing the concept that the total failure of our politicians to even sit down and negotiate in hopes of averting what was once-considered a doomsday scenario is such a bad thing. In short: just because the sequester is a manufactured crisis doesn't mean it can't have the same effect as a non-manufactured crisis in waking up the body politic to the "have cake/eat it too" mentality that dominates not just Washington but the public at large.” Chris Cillizza and Aaron Blake in The Washington Post.

ROSEN: The GOP has only itself to blame. “The Republicans have a remarkably incoherent position on the sequester: It is a terrible policy that must be replaced with a cuts-only solution, they say, but there is no actual GOP plan that fits this description. Republicans seem to be hoping that President Obama will negotiate with himself until they are satisfied.” Hilary Rosen in The Washington Post.

BROOKS: Our second adolescence. “My dream Obama would abandon the big government versus small government argument. He'd point out that in a mature, aging society, government isn't going anywhere. The issue is not size but sclerosis. The future has no lobby, so there are inexorable pressures favoring present consumption over future investment. The crucial point is not whether a dollar is spent publicly or privately, it's whether it is spent on the present or future. The task today is to reform institutions and rearrange spending so we look like a young nation and not a comfort-seeking, declining one.” David Brooks in The New York Times.

Music recommendations interlude: Citizen Cope and Santana, “Sideways,” 2002.

Top op-eds

PONNURU: The Republican reality check. “The main tactical lesson Priebus draws from the 2012 election is that "we've entered a world of permanent politics." By this he means that it isn't enough for parties to contact voters in the months before elections. They have to maintain a constant presence in every community they are trying to reach…What Priebus is doing, though, might make a difference in close races. It's up to the party's candidates to make them close in the first place.” Ramesh Ponnuru in Bloomberg.

RACHMAN: The West and the failure of nations. “Americans may be unable really to address the fact that their political system is not working well. There is a similar problem in Europe, where the compulsion to pay homage to the European ideal stopped many politicians from asking hard, but necessary, questions about the continent's single currency, the euro.” Gideon Rachman in The Financial Times.

The Internet conquers all interlude: North Korea joins Twitter and Instagram.

2) Will we get a vote on the AWB in just two days?

Assault-weapons ban could go to a committee vote on Thursday. “A proposed ban on military-style assault weapons faces a key test vote as early as Thursday when the committee considering gun control legislation is scheduled to decide whether to refer the proposal to the full Senate…Whenever the committee meets, it will consider the Assault Weapons Ban of 2013, introduced by Sen. Dianne Feinstein (D-Calif.), which goes beyond a similar ban that expired in 2004 and covers nearly 160 specific military-style weapons. Among many other specific provisions, the bill also would limit the size of ammunition clips to devices that can hold no more than 10 rounds.” Ed O’Keefe in The Washington Post.

Is Obama’s gun-policy strategy falling short? “Obama's team has been working a delicate inside game to reach out to otherwise combative Senate Republicans: The White House conveys messages to Sen. Chuck Schumer (D-N.Y.), who develops strategy with Sen. Joe Manchin (D-W.Va.), the gun-friendly moderate who is tasked with whipping GOP support…The group has reached a breaking point over how to address records of private sales receipts.” Reid J. Epstein in Politico.

Artistic interlude: Movie “bar codes.”

3) GDP grew 0.5% in Q4 2012

Revisions to economic data are coming in. “Private forecasters expect the Commerce Department to revise the figure and declare that the gross domestic product actually grew in the fourth quarter--probably at about a 0.5% pace…On average, the final GDP growth figure falls between 1.3 percentage points higher and 1.3 percentage points below the Commerce Department’s first estimate, the department’s Bureau of Economic Analysis says.” Eric Morath in The Wall Street Journal.

Americans are worrying about retirement. “Even as the economy slowly improves, the vast majority of Americans remain deeply worried about their ability to achieve a secure retirement, according to a new survey. The poll, to be released by the National Institute on Retirement Security (NIRS) at a conference on Tuesday, found that 55 percent of Americans are "very concerned" that the current economic conditions are harming their retirement prospects. An additional 30 percent reported being "somewhat concerned" about their ability to retire.” Michael Fletcher in The Washington Post.

At sea interlude: While gross cruise ships are still in the news, there’s an abandoned Russian vessel filled with rats drifting in the North Atlantic.

4) Major reforms to Medicaid in the pipeline

States free to cut Medicaid payments, Obama administration says. “The Obama administration said Monday that states could cut Medicaid payments to many doctors and other health care providers to hold down costs in the program, which insures 60 million low-income people and will soon cover many more under the new health care law. The administration's position, set forth in a federal appeals court in California, has broad national implications as it comes as the White House is trying to persuade states to expand Medicaid as part of the new law.” Robert Pear in The New York Times.

Wonktalk: Ezra Klein and Sarah Kliff discuss the American healthcare system as chronicled in Steven Brill’s mega-piece in Time. The Washington Post.

Interview: Sarah Kliff talks with John Kitzhaber, Governor of Oregon, about health reform. The Washington Post.

Could Obamacare make Medicaid more Republican? “Republican governors are making a big ask of the Obama administration in return for cooperating on the Medicaid expansion: They want to overhaul the underlying insurance program that covers 60 million low-income Americans. If the Obama administration agrees, the battles over the health-care law could have an unexpected resolution: A larger, but more conservative, Medicaid program. Emerging deals show governors exploring approaches that would significantly reshape the program, such as moving beneficiaries into privately managed health coverage or giving enrollees a greater financial stake in their health care.” Sarah Kliff in The Washington Post.

Short interlude: This 1-minute, 40-second film was the shortest Oscar nominee ever.

5) The mess in Italy

Everything you need to know about Italy’s messed-up elections. “Results from Italy's election -- held Sunday and Monday -- are trickling in, and the winner is...nobody. With the technocratic caretaker government of Mario Monti out of office, the three main contenders were former conservative Prime Minister Silvio Berlusconi and his party, The People of Freedom; Pier Luigi Bersani of the left-leaning Democratic Party; and humorist Beppe Grillo and his populist Five Star Movement party.” Dylan Matthews in The Washington Post.

It’s a fine Italian mess. “So far just two things about Italy’s elections look clear — that Italians rejected policies of structural reform and austerity, and that financial markets care. Italian bond and stock markets suffered whiplash as exit-poll estimates trickled out today. Italian bond yields fell sharply when it first appeared that Pier Luigi Bersani and his center-left coalition had secured majorities in both houses, implying a solid government. Then those gains and more were lost as new exit-poll data suggested Silvio Berlusconi’s center-right coalition had won the Senate.” Mark Champion in Bloomberg.

…And a protest vote that got a little too far. “Markets, not surprisingly, hate the whole ‘ungovernable’ thing. Nicholas Spiro of Spiro Sovereign Strategy warned the FT of the consequences of a Berlusconi win: ‘financial markets are facing the worst of both worlds in Italy: a full-blown political crisis in the eurozone's third-largest economy and a severe setback for the liberal economic agenda championed by Mr. Monti.’” Ryan McCarthy and Felix Salmon in Reuters.

Explainer: Aldo Poparo explains Italian election law on “The Monkey Cage.”

Economic chaos and political deadlock, here we come? “Italy was on Monday night staring at a period of prolonged political instability following a general election in which voters delivered a resounding rebuff to austerity policies with little hope of any party mustering a governing majority…[T]he fragmented Italian result adds to the uncertainty surrounding Europe's efforts to overcome its sovereign debt and financial sector crisis and to restore economic growth to a region forecast to remain in recession this year.” Tony Barber, Guy Dinmore, Michael MacKenzie, and Dan McCrum in The Financial Times.

Animals interlude: Rats are being put to work in landmine detection.

Wonkblog Roundup

The best sentences we read today. Brad Plumer.

Everything you need to know about Italy’s election. Dylan Matthews

The launch of WonkTalk. Ezra Klein and Sarah Kliff.

When driving a mile can cost you $448. Brad Plumer.

The Republicans’ incomprehensible position on sequestration. Ezra Klein.

Could Obamacare make Medicaid more Republican? Sarah Kliff.

What Chinese hackers get wrong about Washington. Ezra Klein.

Interview: Oregon Gov. John Kitzhaber. Sarah Kliff.

Virginia’s plan to replacethe gasoline tax, and its problems. Brad Plumer.

11 budget ideas from Brookings. Dylan Matthews.