Rep. Paul Ryan Claims Sequester Cuts Are Going To Happen

imagesRep. Paul Ryan (R-Wisconsin) said on Sunday’s Meet the Press that he believes the sequester cuts are going to happen in March and dismissed the view that lawmakers in the House of Representatives want to shut down the government to gain leverage over the federal budget.

Sequester cuts are “across the board” automatic spending cuts in defense and entitlement spending that were intended to kick in on January 1st but were delayed during the “fiscal cliff” negotiations until March 1st.

Sequester cuts are expected to occur because of the 2011 political impasse between Democrats and House Republicans over the debt ceiling that led to the Budget Control Act and the formation of the “Super Committee” consisting of selected politicians from both political parties that were expected to work together towards reaching a fiscal agreement over federal budget cuts.

However, the Super Committee failed to reach an agreement over the particular areas of the budget that needed to be cut which in turn triggered the automatic “across the board” sequestration cuts.

In short, the sequester cuts are projected to total $1.2 trillion over 10 years and are scheduled to end in 2021.

“I think the sequester is going to happen because that $1.2 trillion in spending cuts, we can’t lose those spending cuts” Rep. Ryan explained on Meet the Press.

“But we think these sequesters will happen because the Democrats have opposed our efforts to replace those cuts with others and they’ve offered no alternative” Ryan added.

Democrats are supporting a budget deficit reduction plan consisting of a combination of tax increases and spending cuts while Republicans want spending cuts without higher taxes.

Debt Ceiling Extension

The debt ceiling extension agreement passed last week by the House Republicans guarantees that the federal government won’t default on its debts through mid-May.

However, budget experts claim the newly approved May debt ceiling extension may also increase the likelihood that the automatic sequester cuts set for March 1 will kick in at least temporarily until the debt ceiling chess match begins later in the spring between House Republicans and Democrats.

Although political wrangling over the debt ceiling and sequester cuts are expected to resurface in the weeks ahead, Rep. Paul Ryan emphasized that there is little interest in Washington to shut down the government in exchange for gaining leverage over the federal budget.

“No one is talking about shutting the government down,” Ryan said.

 

About Johnathan Schweitzer 1532 Articles
Welcome to Schweitz Finance. I hope that my financial website will provide you with relevant market information to help you manage your investments with greater clarity and insight.
Contact: Website