The Sequester Still Festers (But Maybe Not in 2014)

(Updated Below)

This column by Jared Bernstein in the Times neatly summarizes the limited expectations people have for the upcoming budget conference committee meetings, which are focused right now on the hope that the committee might at least be able to do something about the 2014 sequester cuts. A “grand bargain,” or any significant progress towards addressing any of the long-term problems in the economy, appears to be out of the question.

The theory is that there might be a (relatively) easy way to replace the 2014 sequestration cuts with some other cuts (or savings) from (most likely) mandatory programs that wouldn’t kick in until many years later. If this sounds like only a slightly better version of the usual kick-the-can-down-the-road approach, that’s because that’s what it would be: a brief respite from the sequester in return for some new cuts over on the mandatory side of the budget that we don’t have to think about until later, while avoiding dealing with anything else.

Bernstein makes a number of illuminating points in his column, like this one:

[R]eplacement cuts will most likely have to come from the mandatory side of the budget, which includes entitlements. Now, there are definitely entitlement savings — say, from Medicare — in the president’s budget that do not affect beneficiaries, like reducing the amount that Medicare spends on drugs by allowing the program to use its clout to get better bargains from drug companies. And there’s other wasteful spending on this side of the budget, like farm subsidies, that could also contribute. (my emphasis)

This paragraph suggested to me a potential approach to a problem facing many of us who will be advocating for sequester relief for non-defense discretionary (NDD) programs (which means almost all federal education programs, such as adult education) this fall: we may be asked by folks on the Hill to support cuts to entitlements in return for lifting sequester cuts.

This is problematic for a couple of reasons. For one thing, our job is to make the case for the program we are there to represent, not to take a position on cutting other programs. And for many of us who represent NDD programs for low-income people, cutting benefits potentially hurts the people we are there to represent, just in a different way. I don’t have the numbers in front of me, but I think it’s safe to assume that a higher-than-average proportion of adult education students probably receive Medicaid and Social Security benefits, for example. It’s a hollow victory to preserve adult education funding while pushing adult education students who benefit from those programs deeper into poverty. (In his column, Bernstein notes that Social Security benefits alone are keeping 22 million people in this country out of poverty.)

At the same time, just saying no doesn’t seem helpful, since, as Bernstein notes above, there are ways to save on entitlements that don’t necessarily involve cutting benefits. So  perhaps NDD advocates could express a preference for looking at entitlement savings that do not touch the actual benefits that people receive, at least as a second best option if raising revenue is off the table. If I’m in a member’s office talking about federal education programs, I still don’t think I have any business talking a position on farm subsidies, but, as a basic statement of principle, taking the position that “sequester cuts to NDD programs should only be replaced with entitlement savings that do not directly affect beneficiaries” at least provides some guidance to members as to what kind of direction they should be going in if they insist on replacing sequester cuts with some kind of cut from the mandatory side.

I should note that Bernstein and his colleagues at the Center on Budget and Policy Priorities also take the position that while they are open to this kind of trade-off, it should only apply to non-defense sequester cuts. That is, folks who want to replace the sequester for defense programs shouldn’t be looking over at the non-defense side for more cuts. To do so would violate an essential principle embedded in the deal that created the sequester: that budget cuts should come in equal measure between defense and non-defense.

UPDATE 10:20am: Stan Collander, who has been pretty good with predictions of late, has just published a post in which he argues pretty convincingly that even a sequester deal is unlikely.