Analysis: Sequester unlikely, but major Defense cuts ahead

Thursday - 1/19/2012, 12:13pm EST

Russel Rumbaugh, co-director of budgeting for foreign affairs and defense, Stimson Center

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Taxes and death are certain. Less certain is what will happen with the 2013 budget. Unless Congress can come up with an alternate plan, sequestration will set in. That will remove $600 billion from future DOD budgets.

"What we've already seen from both the administration and the Pentagon is they're not going to provide a budget at sequester levels," said Russel Rumbaugh, co-director of budgeting for foreign affairs and defense at the Stimson Center. "They're going to come in at the levels mandated by the Budget Control Act, the debt deal signed last August."

Rumbaugh told The Federal Drive with Tom Temin that he thinks DoD is on the right course.

"Sequester is a very unlikely occurrence," he said. "Sequester was a very effective tool throughout the 1990s, when we did successfully reduce our deficit and did successfully bring our budget into surplus."

Russel Rumbaugh, co-director of budgeting for foreign affairs and defense, Stimson Center (Stimson Center photo)

According to Rumbaugh, sequester is only useful when it's enforcing an already existing concensus. It's not so useful at creating a concensus. "The stick of sequester doesn't make people agree any more than they were agreeing without that threat," he said.

Since sequester was created, it's been triggered five times. Once, in 1986, sequester was triggered and a portion of funds was taken away. But in three of the remaining four occurrences, Congress waived off or modified the sequester. The sequester that occurred in 1991 did take money from the budget — just $1.4 million of the entire domestic spending, which was less than 2,000th of percent.

"Nobody — the Pentagon, either party in Congress, either house in Congress &mdash really wants the sequester to take effect," Rumbaugh said. "It's a very bad budgeting mechanism. It's intentionally designed to be bad." If the sequester were to kick in, it would mean a 10-percent cut in spending in one year, not just from the DoD budget but the domestic budget as well.

Just because the sequester is bad and it's unlikely to occur, Rumbaugh said, doesn't meant there won't be a lot of talk about it in the press and in Congress. The big problem will be how long it takes for the actual deal to emerge that takes away sequester.

In the meantime, the White House and the Pentagon are dealing with the new fiscal reality. Defense Secretary Leon Panetta has already announced major cuts in spending and the removal of two battalions of troops from Europe.

"A strategic rationale to reduce ground forces, that's much bolder than saying 'Hey, we had a temporary increase and I'm going to take it away,' or 'Hey, let's try to find some administrative savings and shut down a couple of back offices,'" Rumbaugh said. "But rather say, 'We really can get by by a smaller ground force.'"

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