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From Melting Pot to Sand Box – Can’t We All Just Get Along?

by Judd Ballard

The Government Sequester: How did we get here?  And was this really supposed to happen?

Pre-game Super Bowl flyovers… probably a thing of the past.  Depending on your level of patriotism, this may or may not hit home.  Still seen as a prideful, show-of-force ritual at some of the country’s most anticipated sporting events, government spending cuts will likely put the clamps on this and other similar patriotic acts funded by the Pentagon.  Unfortunately, that’s just the beginning of the spending cuts that took effect Friday,
March 1st.

All eyes are focused on March 27th.  Can the government get a deal done to avert a shutdown?  Without the houses of Congress coming to a deal, current government funding will run out by March 27th.  Without passage of a funding bill, a potential government sequester may remain in effect until September 30, 2013 (or, ummmm, possibly forever).  The House, appears to have done their job momentarily.  The largest hurdle at this point is the Democrat’s insistence to raise taxes, but what for?  The Democrats wish to fund the government, while the Republicans wish to cut the deficit.

House Speaker, John Boehner, insists the tax hike portion of the fiscal cliff deal is as far as he’s willing to go.  Will he hold true to his word?  I think a lot of people including Boehner and other Republicans would feel a lot better about their position if the effect on the economy were more foreseeable.  Supposedly-independent economists have warned a potential loss of 750,000 jobs, something White House Economic Advisor, Gene Sperling, has taken the high road on.

The wasteful spending has got to go; I think everyone can agree on that.  Didn’t we just hear the same thing two years ago?  But have we even made a dent in the problem?  Maybe for the time being, we should be thankful that this time the cuts were automatic, albeit abrupt.  While still untouched as of this week, according to President Obama, even federal entitlement spending (i.e., Social Security, Medicare, etc.) may face cuts.

In my opinion, what’s most concerning are the roughly 13% cuts in defense spending through the end of September, creating increased exposure to potential national security crises during a time of such unrest in Africa, the Middle East and, most recently, southeast Asia.  If any one of those regions spiral into further turmoil, it is sure to send the economy down the drain (faster than eliminating unemployment benefits already being abused by
some recipients).  There’s no question we’re all too familiar with that possibility during an unstable economy.

Finally, if you’ve kept up on the Sequester at all, and cared to read what the White House is posting, I think the most comical piece you’ll read is the following statement from the Office of Management and Budget that says, “The President’s 2013 Budget is built around the idea that our country does best when everyone gets a fair shot, does their fair share, and plays by the same rules.”

Lost in translation must be the definition of fair.  I haven’t read the detailed list of cuts top to bottom, but I would hope somewhere in there are the millions upon millions of dollars paid in aid annually to countries that detest the United States.

This entry was posted in Audit & Tax Talk and tagged Accounting. Bookmark the permalink.

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