After adjusting for inflation our federal spending, post sequestration, is back to 2009 levels. In 2009 military members had tuition assistance. Why is it then that if our spending levels are the same that we don’t have tuition assistance available for military members? Why is it that, if this isn’t an actual cut to federal spending that the military is getting real cuts to spending? Why is it that promised domestic spending programs (Medicare, Medicaid, Social Security, Obamacare) aren’t touched, but benefits of military members who have spent the past 10 years at war are being cut?
There are a lot of questions that military members are asking right now because this is starting to actually affect them and they don’t understand why or what else might happen. I will attempt to lay out some information for the purpose of understanding this complicated issue a little better.
First let us back up and talk about what the sequester is. The sequester is a set of automatic spending cuts that began on March 1st. The Budget Control Act was signed by the President in August of 2011 in order to put pressure on Congress to come up with a long term plan for deficit reduction. He gambled thinking that Congress would never let such cuts occur and therefore cave to his pressure. The “cuts” equate to $1.2 trillion spread out over nine years and is equally divided between domestic and defense-related spending.
Senate Democrats attempted to back up the sequester for 10 months by introducing the “American Family Economic Protection Act” which called for $60 billion in cuts and $60 billion in tax hikes. It never had a chance because the Republicans weren’t about to raise taxes a 2nd time in 3 months (the President got his tax increases on January 1st). The GOP would argue that the whole purpose of the sequestration was to force tax increases. The Republicans attempted to dodge the current fallout with a bill that would have kept the sequestration in place, but would have given the President control over where the cuts were instead of the broad cuts. Of course, the President didn’t want that burden (and frankly, it’s not his job). In the end, the President didn’t get his tax increases and the GOP didn’t get their spending cuts so the sequestration was implemented.
So now let us iron out a few fun facts.
First, the sequester doesn’t cut federal spending at all. It only cuts future increases in spending. Our federal government’s spending is set up in a very disturbing way. Basically, they increase spending by a certain percentage every year. You justify your budget by spending your budget and then you get an automatic increase if you spent all of it. So, for the sake of easy math, if the federal government as a whole spent $4 trillion in 2012, it will budget (without passing a budget) an automatic increase in spending. The sequester “cuts” out the % of increase of that automatic increase. The cut is minimal though. Even with the sequestration in place we will still spend $2.4 trillion more dollars in 2023 than we do today. We’re on a trend of around 3% increases in spending each year – the sequester would take that down to about 2%.
Days leading up to the March 1st deadline the President and democratic congressional members used every outlet they could to convince Americans that the sky would fall if Republicans let the sequester happen. Of course, republicans couldn’t just “let it happen”, it took both parties. Republicans only control the House. Let us look at some of the scare tactics used.
The President put out a report claiming things like “Ohio would lose $25.1 million for education” and that “Pennsylvania could lose $271 to fight domestic violence”. More proven falsehoods released by the democrats: Capitol janitors would receive a pay cut, “there are literally teachers now who are getting pink slips, who are getting notices that they can’t come back this fall”, Meals on Wheels will be forced to serve 4 million fewer meals, 70,000 children will lose access to Head Start programs, and of course “170 million Americans” will lose their jobs (there aren’t 170 million American workers). All of these are complete fabrications (among a long list of others) that were claimed to make it look like America would fall apart if we didn’t give the democrats what they wanted – tax hikes and increased spending.
All of that rhetoric tempered down when March 1st came. The President, numerous times, came out after signing the authorization for the sequestration saying that we wouldn’t feel the effects right away. And, for the most part, few did. There aren’t orphans crowding the streets, old people aren’t being left to die, complete fire departments haven’t been shut down and unemployment rates didn’t skyrocket. What did happen? The military got real cuts.
So why is it that the military got real cuts when the sequestration isn’t a real cut? Here’s the rub. The sequestration isn’t a cut on the federal government’s overall spending, but many areas within that gigantic spending block are off limits. An understanding of political history coupled with an understanding of our budget is necessary to appreciate these cuts and their logic. So let us look at the 2012 budget.
We spent $3.796 trillion dollars. Our total revenue was $2.469 trillion giving us a $1.1 trillion dollar deficit. The sequestration would call for $86 billion (less than 1%) to be saved from the next year’s deficit (overreaction to pennies). Of that $3.8 trillion dollars spent more than half went to Social Security, Medicare, and Medicaid. Another 15% went to income security (retirement benefits for federal workers). None of those programs could be touched by the sequester. The DoD, however, is another 21% of our budget. Everything else (Dept. of Education, Dept. of Agriculture, Dept. of Transportation, etc. are all pennies in comparison to these programs). In fact, if you combine the DoD, Social Security, Health and Human Services, Income Security, and our Net Interest you get around 80% of our federal spending.
Now, if we can’t cut Social Security, Medicare, Medicaid, the Net Interest or Income Security and then everything else is tiny in comparison, where do you make your cuts? Easy, Department of Defense. Democrats protected Social Security, Medicare, and Medicaid. Now, here’s where it’s important to pay attention. The sequestration isn’t a cut, but it is a cut in future spending. All but 1 of our large federal programs is going to grow and of those large federal programs they make up more than 80% of our budget. That means while it isn’t a cut for the federal budget, the DoD is going to have to make up the cost for those other programs continuing to grow and not taking any future cuts. In other words, the DoD has to bare the largest burden and is ACTUALLY a cut for them because our other programs are going to continue to grow.
Now, why is it that the DoD is cutting military benefits? Technically tuition assistance isn’t considered a benefit. Military retirement, medical, etc., those are considered benefits. Neither congressional members nor the President made the decision to specifically cut the military TA, the decision where to make the cuts was left to the branches respectfully. The quickest cut that each branch could make that wouldn’t affect the mission was to cut tuition assistance. You cannot simply stop missions or sell off air craft.
There is a dirty side to this though. Huge projects like the F-35 ($400 billion) and others like it are contracted out and protected by big money (think lobby). There are jobs at stake and a lot of money being paid out to civilians in order to complete them. They will remain largely untouched. Sending free air craft and $250 million in aid to Egypt on the week of the sequester probably disgusts the Army Ranger who has been deployed 6 times and was hoping to start taking classes now that he’s back to the states. Federal aid isn’t a DoD fund though, so that decision isn’t up to the branches.
We are on the heels of two wars that have been going on for around 10 years. Historically we took huge cuts in the DoD after wars (-43% post-Korea, -33% post-Vietnam, -36% post-Cold War). With the sequester and Budget Control Act caps, we are looking at a proposed 31% cut on budget authority for the DoD. The water is a little muddier now though. The “War on Terror” doesn’t have the tangible parameters that previous wars had and their downsizing was done systematically, unlike this forced sequestration.
The military was used as a poker chip in a game with two bluffers with bad hands. The problem with the analogy is that the bluffers don’t lose in the hand, the chip does. Politicians aren’t going to suffer from this sequestration. Their belts won’t tighten, ours will. I’ve argued for quite some time that the military has plenty of room for cuts, that given our deficit problems underscored by the basic principle of limited government, the DoD can downsize and at least stop wasteful spending. I am no lobbyist for the United States Military.
Still, I appreciate the men and women of the Armed Forces. They are the ones who will feel the pain in this sequestration. That’s pretty shameful when you consider what they’ve gone through over the past decade. In the end the military branches will have to make spending cut decisions because our politicians couldn’t. In the same year when the President signed an Executive Order to increase the pay of congressional members, within weeks of having Nancy Pelosi say that congressional members should be compensated “for the dignity of the job that we have rewarded”, we have military members getting blindsided.
*My budget numbers were taken from the U.S. Government Budget at the following link*
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