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Obama Suggests Short-Term Fix To Sequester


It's MORNING EDITION from NPR News. I'm Steve Inskeep.


And I'm David Greene. Good morning.

If Congress and the president do not act in the next three weeks, deep across-the-board spending cuts will hit everything from the Defense Department to education programs.

In the lingo of Washington, these cuts are called the sequester. They were never meant to happen. The threat of them was supposed to force lawmakers to agree on a deficit reduction plan. President Obama is now calling on Congress to replace the sequester, at least in the short term.

Here's NPR congressional correspondent Tamara Keith.

TAMARA KEITH, BYLINE: If you're setting your countdown clocks, the date is March 1. That's when the sequester is set to hit. It's something politicians on both sides of the aisle agree is like budgeting with a meat cleaver, when a scalpel would make more sense.

Here's President Obama yesterday in the White House Press Briefing Room.

PRESIDENT BARACK OBAMA: Indiscriminate cuts to things like education and training, energy, and national security will cost us jobs, and it will slow down our recovery.

KEITH: The problem is there's really no agreement on how to avoid it. Last year, House Republicans offered two bills that would replace the automatic cuts. But those bills died in the Senate - largely because the replacement cuts seemed designed to turn off Democrats.

Now the president is calling for Congress to pass a short-term fix that would replace a few months of across-the-board cuts with a mix of targeted spending cuts and new revenue.

OBAMA: They should at least pass a smaller package of spending cuts and tax reforms that would delay the economically damaging effects of the sequester for a few more months, until Congress finds a way to replace these cuts with a smarter solution.

KEITH: The president and the White House didn't go into detail, saying just which programs would be cut or which tax loopholes closed would have to be worked out with Congress. But at least one critical part of Congress wants none of it. House Republicans.

REPRESENTATIVE TOM COLE: I think anything that involves higher taxes is dead on arrival.

KEITH: Tom Cole is a Republican from Oklahoma and a member of the House leadership. He says after the fiscal cliff deal raised tax rates on the wealthiest Americans, Republicans are done with revenue increases in any form, including what the president is calling for.

COLE: The president and Congress can argue over this. But politically, that wouldn't pass the House. And so this really gets down to what can get through the House, and on this round it's either going to be the sequester as written or it's going to be something negotiated, and I think preferable, you know, reallocation of the spending cuts. But it's going to be spending cuts.

KEITH: If no one budges, the sequester happens. And Cole says many House Republicans are just fine with that. All of this comes as the Congressional Budget Office announced that for the first time in five years, the federal government is on pace to keep its annual deficit below a trillion dollars.

The non-partisan budget analyst Doug Elmendorf projects the deficit will come in at $845 billion.

DOUG ELMENDORF, BUDGET ANALYST: I think what our report does show is that we have a large budget imbalance.

KEITH: And that imbalance will grow towards the end of the coming decade because of an aging population and rising health care costs.

ANALYST: I think what that implies is that small changes in budget policy will not be sufficient to put the budget on a sustainable path.

KEITH: The CBO doesn't get into politics or even policy, for that matter. But the message he seems to be sending to Congress and the president is - you know that grand bargain you guys keep trying and failing to reach? Keep trying.

Tamara Keith, NPR News. Transcript provided by NPR, Copyright NPR.