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The Sequester: How Do Government Budget Cuts Affect Me?

by Lena Rizkallah on March 1, 2013

sequester budget cutsToday’s post comes from GoGirl Finance expert, Lena Rizkallah, who writes about what today’s budget cuts mean for you.

A recent USA Today poll revealed that about 25% of Americans know little to nothing about the sequester–the mandatory across-the-board budget cuts instituted today This is alarming since these budget cuts could affect us on a daily basis and could make life pretty inconvenient. Probably because of this collective cluelessness, another Pew/USA Today poll revealed that if nothing is done to resolve the sequester issue, about half of Americans will put the blame on Congressional Republicans and about 30% will blame the Obama Administration. And so, the finger-pointing continues in yet another politician-created crisis.

How did we get ourselves into this mess?

The sequester resulted from the debt ceiling debacle in the summer of 2011. Congress was debating whether to raise the debt ceiling and had a deadline of August 1st to come up with an agreement along with a deficit reduction plan. A “supercommittee” of politicians from both parties worked together to figure out mutually beneficial tax increases and budget cuts. Not surprisingly, the committee failed to agree on final terms; what they did come up with was a plan to decide to plan to hopefully-maybe-fingers-crossed come up with some deficit reduction options sometime in the inter-galactic future. 

This mandate was part of the Budget Control Act of 2011, and also included the sequestration language–that is, failure to agree on deficit-reducing legislation would automatically trigger the sequester, which are automatic cuts that would affect every discretionary area of the federal budget.

When the Budget Control Act was drafted, no one thought Congress would be so irresponsible as to allow these budget cuts to be triggered. But like the 2011 debt ceiling debacle that lasted over six months and culminated in deadline drama, and the recent fiscal cliff thriller that ended with “cliff”-hanging legislation on New Years Eve, it looks like Congress is going to ride this one out too.

To read the rest of the article, go here.

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