Sequestration Would Spare Some Infrastructure Investments

On Sept. 14, the White House released a report detailing the consequences of automatic spending cuts to the federal budget scheduled to go into effect on Jan. 2. The cuts are required by the Budget Control Act (BCA) of 2011, the deal to raise the national debt ceiling following the failure of the so-called congressional “super committee” to reach a bipartisan agreement to curb spending.
 

The report details the dollar amount each federal agency in all branches of government would have to bear if the sequestration takes force. Most federal programs and agencies will confront an 8.1 percent reduction to their budgets at the beginning of the new year.
 

However, transportation investments, such as the Highway Trust Fund, TIFIA, and Airport and Airways Trust Fund, are largely supplied by special trust accounts and would mostly be spared from the budget axe. Meanwhile, other infrastructure investments, such as water infrastructure programs, would see their resources dramatically slashed.
 

The severity of the potential impact of sequestration highlights the need for lawmakers to work together to find a long-term solution to the nation’s budgetary and fiscal problems. It is worth remembering that Congress designed the sequestration process to be so dramatic that it would force lawmakers to act.
 

Finally, not widely reported is the fact that the salaries for representatives and senators are in the category of spending considered “mandatory” and not subject to sequestration. However, congressional staffers would lose more than $100 million in pay should the budget axe fall. It remains to be seen how lawmakers manage the political risk associated with receiving their full salaries while popular programs are cut and their own employees are forced to make due with less.