Obama Administration Releases Sequester Report
WASHINGTON, DC –The White House has released a state-by-state report on the devastating impact the sequester will have on jobs and families across the country.
The series of automatic cuts as a result of the sequester will affect hundreds of thousands of middle-class jobs while cutting vital services for children, seniors, people with mental illness, and uniformed servicemen and women.
The sequester officially went into effect Friday, March 1; it was enacted as part of a budget deal cut in August 2011 to avoid default on America’s debt. Republicans at the time refused to raise the debt ceiling – the allocation of funds to pay the nation’s existing loans – without a guarantee that the Obama administration would reduce spending. The original idea was that such severe cuts would force Congress to pass a comprehensive budget bill, but some in the Republican-dominated House of Representatives preferred to let the cuts kick in rather than accept any deal that includes closing tax loopholes that benefit corporations and the very wealthy.
Though some sequester-related cuts have begun, most will not take effect until March 27, when the current “continuing resolution” that allows spending to continue at current levels expires. If Congress does not intervene before then, all the planned cuts will take effect across the board.
NC Loss of $300 Million – The Tarheel State will be hit by losses of more than three hundred million dollars ($300,000,000) between March 27 and September 30, or approximately fifty million dollars a month.
Education: Loss of $40 Million – In North Carolina, approximately 350 teacher and teacher-aide jobs are at risk due to the loss of $25.4 million in funding for primary and seccondary education. The state will also lose approximately $16.8 million in funds for another 200 teachers, aides, and staff who help children with disabilities.
Pre-school children will also take a hit. Head Start and Early Head Start services will be eliminated for approximately 1,500 children in North Carolina, reducing access to critical early education. And at the higher education level, around 1,150 fewer low-income students will receive aid to help them finance the costs of college, and around 890 fewer students will get work-study jobs that help them pay for college.
Other children’s services
Up to 1,300 disadvantaged and vulnerable children could lose access to child care, which is also essential for working parents to hold down a job. Reduced funding by about $243,000 will result in as many as 3,550 children not getting vaccinated for diseases such as measles, mumps, rubella, tetanus, whooping cough, influenza, and Hepatitis B.
Public Health: Loss of $4,775,000
Overall, North Carolina will lose approximately $911,000 in funds to help upgrade its ability to respond to public health threats including infectious diseases, natural disasters, and biological, chemical, nuclear, and radiological events. In addition, the state will lose about $1,980,000 in grants to help prevent and treat substance abuse, cutting 3,700 slots in substance abuse programs, and about $341,000 in grants to the state Health Department, resulting in around 8,500 fewer HIV tests.
The state could also lose approximately $1,543,000 in funds that provide senior citizens with essential nutrition assistance, such as Meals on Wheels and subsidized lunches at community centers.
Job Search Assistance: Loss of $83,000
North Carolina will lose about $83,000 in funding for job search assistance, referral, and placement, meaning around 15,110 fewer people will get the help and skills they need to find employment.
Environmental Protection: Loss of $4.8 million
Under the sequester, North Carolina will lose about $3,606,000 in environmental funding to ensure clean water and air quality and prevent pollution from pesticides and hazardous waste. In addition, the state could lose another $1,265,000 in grants for fish and wildlife protection.
Law Enforcement and Public Safety: Loss of $600,000
North Carolina will lose about $401,000 in Justice Assistance Grants that support law enforcement, prosecution and courts, crime prevention and education, corrections and community corrections, drug treatment and enforcement, and crime victim and witness initiatives. And the state will likely lose up to $205,000 for its STOP Violence Against Women Program, which provides services to victims of domestic violence, resulting in up to 800 fewer victims being served.
Armed Services: Loss of $250,000,000
Approximately 22,000 civilian Department of Defense employees would be furloughed under the sequester, reducing gross pay by around $117.5 million in total. The Army’s base operation funding would be cut by about $136 million in the state, the Air Force’s funding by about $5 million, and the Navy will cancel aircraft depot maintenance in Cherry Point, NC.
Wider impact
One of the worst consequences of the sequester is its broader impact on the economy as a whole. When teachers are not rehired for the fall semester, or when tens of thousands of civilian employees of the Defense Department lose 20% of their pay every week, the lost income translates into less shopping, dining out, and spending money in the community.
Every dollar that is generated by a job adds up to three or even four dollars in overall economic growth, as the new employee spends at groceries and restaurants, and those businesses in turn hire more people, and those additional hires spend at gas stations and bookstores, leading to the “virtuous cycle” of a growing economy.
By taking $82 billion out of the U.S. economy over a period of six months, the sequester is anticipated to cost the nation 750,000 full-time jobs this year alone – which translates into 1.5% lower economic growth for the year. Any further cuts could plunge the nation into a second recession, as has happened in European countries that have elected “austerity budgets” rather than stimulus plans.
