Congress failed to enact legislation that would have forestalled or modified sequestration before the March 1 deadline, thus the automatic spending cuts (50% defense and 50% non-defense) of approximately $85 billion for 2013 will be implemented over the coming weeks.

P. Scott Shearer, Vice President

March 4, 2013

1 Min Read
Sequestration Begins, Debt Ceiling Looms

Congress failed to enact legislation that would have forestalled or modified sequestration before the March 1 deadline, thus the automatic spending cuts (50% defense and 50% non-defense) of approximately $85 billion for 2013 will be implemented over the coming weeks.  The White House released its sequestration report that outlines the cuts for both defense and nondefense. Sequestration rates for non-exempt programs include:

  • 7.8% defense, discretionary

  • 7.9% defense, mandatory

  • 5.0% nondefense, discretionary

  • 5.1% nondefense, mandatory

  • 2.0% Medicare

Because the cuts are implemented over seven months instead of 12 months, the effective rate is: 13% defense and 9% nondefense.  Besides sequestration, there are two other key fiscal timeframes facing Congress and the Obama administration.  On March 27, the FY ’13 continuing resolution (FY ’13 appropriations) expires.  If Congress fails to extend the continuing resolution by March 27, the government would shut down at that time.  The federal government will reach the debt ceiling on May 19.  All of these fiscal cliff issues will also affect how Congress will deal with the farm bill this year.

About the Author(s)

P. Scott Shearer

Vice President, Bockorny Group, Inc.

Scott Shearer is vice president of the Bockorny Group Inc., a leading bipartisan government affairs consulting firm in Washington, D.C. With more than 30 years experience in government and corporate relations in state and national arenas, he is recognized as a leader in agricultural trade issues, having served as co-chairman of the Agricultural Coalition for U.S.-China Trade and co-chairman of the Agricultural Coalition for Trade Promotion Authority. Scott was instrumental in the passage of China Permanent Normal Trade Relations and TPA. He is past chairman of the USDA-USTR Agricultural Technical Advisory Committee for Trade in Animals and Animal Products and was a member of the USAID Food Security Advisory Committee. Prior to joining the Bockorny Group, Scott served as director of national relations for Farmland Industries Inc., as well as USDA’s Deputy Assistant Secretary for Congressional Affairs (1993-96), serving as liaison for the Secretary of Agriculture and the USDA to Congress.

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