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Behind the Lines: Sequestration Consternation
First Published Feb 25 2013 08:02 am • Last Updated Feb 25 2013 08:02 am

Welcome to Behind the Lines, a weekly conversation with Salt Lake Tribune cartoonist Pat Bagley and BYU economist Val Lambson.

Bagley: Originally designed to be poisonous to our fiscal health — and thus to be avoided — the dreaded sequester is now being touted by Republicans as a bracing colonic. Just what the country needs to stop feeling so bloated with debt! We’ve binged, so now we must purge. The non-partisan Congressional Budget Office, on the other hand, says we will lose 750,000 jobs and the country be knocked back into recession if the sequester plays out.

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What makes these seemingly endless, manufactured crises so disheartening is that there are signs business is ready to start investing. Not likely while Washington is in perpetual lucha libre mode.

Lambson: As Dr Strangelove (played by Peter Sellers) pointed out, a doomsday machine only achieves its goal of deterrence if the other side believes that you have it. There have been so many similar attempts to rein in government spending that they are not credible. My prediction: There will be an accommodation made that will involve higher taxes but no real spending cuts.

Bagley: It seems to me the most effective way to reduce the deficit is to get the economy moving. Immediate cuts and austerity are likely to undercut recovery, as Europe, and specifically Britain, are showing. My prediction: Republicans will let sequestration and its haphazard cuts grind away in the name of fiscal thrift, even though the CBO says we could lose all those jobs. The aphorism is, penny wise pound foolish.

Lambson: Your first sentence could be right out of the Republican rhetoric book in the section on tax cuts. The CBO estimate doesn’t mean that 750,000 people will be unemployed forever. Cutting government programs will erase jobs in the government sector. The private sector, if not shackled by too much taxation and regulation, will expand. Of course it is painful to lose a job and to have to find another. If this is the reason for avoiding spending cuts and not just cover for a big government agenda, a better way to handle these costs would be to give severance pay to displaced workers to ease the burden of the transition.

Bagley: A CBO study that showed tax cuts to the wealthy contributed almost nothing toward growth was suppressed by Republicans because it didn’t square with their ideology. And you know very well that cutting the budget to the Center for Disease Control has knock on effects to the private sector companies that provide everything from high tech equipment to deli sandwiches for those government drones who worry about trivial things like killer pandemics.

Sequestration doesn’t even touch the real driver of future government spending: Medicare.

Lambson: That study is consistent with my view that we are discussing small adjustments relative to the enormity of our fiscal problems. And you know very well that former government employees will still eat deli sandwiches when they are working in the private sector. (I prefer "government employees"to "government drones" both because government workers are often hard working and well-intentioned and because "government drones" has taken on a more specific and sinister meaning under your favorite president.)

Bagley: Good news on the drone front! A powerful Washington pol is finally calling for limits on President Obama’s drone powers. Unfortunately, it’s President Obama.


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Lambson: It is always nice when one can agree with the President.

Lambson: The top comment is from tt600 "[I]t is better for the economy that the money for the increased sales comes from a program like the EITC that supports job growth rather than a job-killing increase in the minimum wage."



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