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TheStreet Open House

Sequester Q&A: For US, A New Season Of Uncertainty

By ANDREW TAYLOR

WASHINGTON (AP) â¿¿ Here comes the sequester: big federal spending cuts and a new season of economic uncertainty for a nation still trying to shake off a recession.

The politics of sequestration have been fierce, the finger-pointing incessant. And to no one's surprise, what was designed as a way out of one Washington standoff has produced another one â¿¿ and more. A week out from the March 1 deadline, there are no meaningful efforts in Washington to avert the punishing automatic cuts set out in a law nearly two years ago.

Bellowing and blame aside, what really would happen if, as expected, President Barack Obama and congressional lawmakers allow the nation to blow past the deadline?

Q: What's the big overall picture?

A: A series of cuts to federal agencies that would lead to longer lines at the nation's borders, less money for teachers and more hassle at airport checkpoints. Virtually every dollar approved each year by Congress would be slashed by a uniform amount, which would mean at least temporary layoffs for hundreds of thousands of public and private-sector workers. Programs like Medicare and Social Security are exempt, but there is no question the slashing of other programs would slow the nation's fragile economic recovery.

Q: And the big numbers?

A: Under a 2011 law designed to avert exactly this type of inaction, March 1 means automatic cuts of $85 billion from a $3.6 trillion budget over the seven months spanning March-September. That would include cuts of 8 percent to the Pentagon and 5 percent to domestic agency operating budgets. More than 3.8 million Americans who have been jobless for six months or longer could see their unemployment benefits reduced by as much as 9.4 percent.

Q: Why is this happening, what's actually going to occur and who is likely to be most affected. First, how did we get here?

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