Stay or Go?
Washington lawmakers have a dilemma. They are scheduled to go home for Easter
Break on March 25th and the break lasts until April 7th. The White House
budget which comes out in mid-February is not expected to come out until
mid-March. If the budget does not address the necessary funding for to
run the government, there will be a shutdown on March 28th.
There is also a deadline of March 1st for the ‘sequestration’. This is a federal
statute that was signed into law by President Obama on August 2nd, 2011.
Besides being a scary word that will become very familiar to America
fairly soon, it signals approximately $85 billion in automatic spending
cuts that will take place over the next several months.
Some federal agencies would be required to cut their budgets by up to 10%. For
example, CNN reported that this means the Department of Defense would
begin to furlough its 800,000 workers by having them stay home 1 day per
week without pay. Other cuts would include 4 million less “Meals on
Wheels” to our elderly. All of this is part of an effort to reduce
federal deficits $1.2 trillion over ten years or $120 billion per year.
The debt that’s heading toward $17 trillion? That conversation will take place after
Easter break. There’s no reason to discuss the dollars while the
posturing over the pennies is heading for a showdown.
-Mark Schuster, Partner
February 10, 2013