News / USA

White House: Budget Cuts 'Deeply Destructive'

Cindy Saine
A White House report released Friday details how some $120 billion in cuts to defense and domestic programs next year will be applied starting January 2, 2013, unless Congress takes action to avert the automatic cuts it approved last year. The risky situation many analysts are referring to as the "fiscal cliff."

Senior Obama administration officials told reporters Friday that the report, mandated by Congress, leaves no question that the automatic spending cuts, known as sequestration, would be deeply destructive to national security, domestic investments, and core government functions.

The report outlines that there would be a 9.4 percent cut to most defense programs, except those exempted such as pay for military personnel and veterans' benefits and medical care.  There would be an 8.2 percent cut to domestic discretionary programs, including scientific research, food inspection, Education Department programs and border security.  Social Security benefits for retired Americans and Medicare health care benefits for older Americans are exempt.

Bipartisan majorities in both the House of Representatives and Senate voted for the threat of sequestration in August of last year, as a mechanism to force Congress to act on further deficit reduction.  Now, lawmakers from both major political parties are deeply unhappy about the prospect of the cuts, and are blaming the other party.

"Sequestration, as these cuts are known, threaten our national security, an estimated 200,000 jobs in Virginia will be lost, jobs that our support our war fighters and their mission around the world," said Republican Representative Robert Wittman of Virginia.
.
Democrats blamed the Republican majority in the House for announcing that the chamber plans to adjourn at the end of next week and to not return until after the November elections.

"Before we adjourn there will be no resolution on the budget, there will be no resolution on the sequester, $1.2 trillion that is causing disruption throughout the country and particularly among the entire federal government, especially the defense industry, which will have to absorb half of that sequester.  It could affect directly about a million jobs, almost 2 million jobs indirectly, but we are not going to do anything about it," said Democratic Representative James Moran of Virginia.

Congress has been consumed by battles over government spending and tax cuts for the past two years.  Democrats insist that tax increases for top earners must be part of any package to reduce the national deficit.  Republicans refuse to include any tax increases, and want deeper cuts to domestic programs such as food stamps for the poor.

Economists are warning that even the threat of spending cuts and tax increases is hurting the U.S. economy.  

"This uncertainty about the fiscal cliff coming early next year has reduced risk-taking.  Businesses, they don’t want to get out on a limb, over-hiring, buying too much capital, because they don’t know if all of a sudden, at one point in time, that we are going to have an increase in taxes, a decrease in spending, and we would literally go off a cliff," said Bob Costello, the chief economist of the American Trucking Association.  
 
The spending cuts would include cuts of $129 million per year over nine years that were to be allocated for the security, construction, and maintenance of American embassies around the world. In the wake of this week's attacks on U.S. embassies in Libya, Egypt and other countries, lawmakers are likely to strongly reject any cuts to embassy security.

Obama administration officials say the sequester is a blunt instrument that was never intended to go into effect, and they hope the almost 400-page report will motivate lawmakers to bridge their differences to avert devastating cuts.

You May Like

Could Nemtsov Threaten Putin in Death as in Life?

Dynamic and debonair opposition leader had supported liberal economic reforms, criticized Russian president's aggression in Ukraine More

Oil Smuggling Highlights Challenges in Shutting Down IS Finances

Pentagon spokesman says Islamic State 'certainly continues to get revenue from the oil industry black market' but that airstrikes have made a dent More

India Focuses on Infrastructure, Investment to Propel Economy

Government expects economy to grow at 8 to 8.5 percent in next fiscal year More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
US Supreme Court Hears Hijab Discrimination Casei
X
Katherine Gypson
February 25, 2015 11:30 PM
The U.S. Supreme Court has heard opening arguments in a workplace religious discrimination case that examines whether a clothing store can refuse to hire a young woman for wearing the headscarf she says is a symbol of her Muslim faith. Katherine Gypson reports from the Supreme Court.
Video

Video US Supreme Court Hears Hijab Discrimination Case

The U.S. Supreme Court has heard opening arguments in a workplace religious discrimination case that examines whether a clothing store can refuse to hire a young woman for wearing the headscarf she says is a symbol of her Muslim faith. Katherine Gypson reports from the Supreme Court.
Video

Video Falling Gas Prices Hurt Nascent Illinois Hydraulic Fracturing Industry

Falling oil prices are helping consumers purchase cheaper petroleum at the pump. But that’s made hydraulic fracturing or “fracking” less economically viable for the companies in the United States invested in the process. VOA’s Kane Farabaugh reports on one Midwestern town that was hoping to change its fortunes by cashing in on the next big U.S. oil boom.
Video

Video Fighting in Sudan's South Kordofan Fuels Mass Displacement

Heavy fighting in Sudan's South Kordofan state is causing hundreds of thousands to flee into uncertain conditions. Local aid organizations estimate as many as 400,000 civilians have been internally displaced since the conflict began more than three years ago, while another 250,000 have fled across the border to refugee camps in South Sudan. VOA's Adam Bailes reports.
Video

Video Lao Dam Project Runs Into Opposition

A Lao dam project on a section of the Mekong River is drawing opposition from local fishermen, international environmental groups and neighboring countries. VOA's Say Mony visited the region to investigate the concerns. Colin Lovett narrates.
Video

Video A Filmmaker Discovers Her Biracial Identity in "Little White Lie

Lacey Schwartz grew up in an upper middle-class Jewish family, in a town in upstate New York where almost everyone she knew was white. She assumed that she was, as well. Her recent documentary, Little White Lie, tells the story of how she uncovered the secret of her true racial background. VOA’s Carolyn Weaver has more on the film.
Video

Video Deep Under Antarctic Ice Sheet, Life!

With the end of summer in the Southern hemisphere, the Antarctic research season is over. Scientists from Northern Illinois University are back in their laboratory after a 3-month expedition on the Ross Ice Shelf, the world’s largest floating ice sheet. As VOA’s Rosanne Skirble reports, they hope to find clues to explain the dynamics of the rapidly melting ice and its impact on sea level rise.
Video

Video US-Cuba Normalization Talks Resume Friday

Negotiations aimed at normalizing diplomatic relations between the U.S. and Cuba resume Friday. On the table: lifting a half-century trade embargo and easing banking and travel restrictions. There's opposition in Congress, but some analysts say there may be sufficient political and economic incentives in both nations for a potential breakthrough this year. VOA's Mil Arcega reports.
Video

Video Pakistan's Deadline For SIM Registration Has Cellphone Users Scrambling

Pakistani cell phone users have until midnight Thursday to register their SIM cards, or their service will be cut off. While some privacy experts worry about government intrusion, many Pakistanis are just worried about keeping their phone lines open. VOA Deewa reporter Arshad Muhmand has more from Peshawar.
Video

Video Myanmar Warns Factory Workers to End Strikes

Outside Myanmar's main city Yangon, thousands of workers walked off their jobs earlier this month demanding a doubling of their wages, pay raises after a year and input from labor unions on industrial regulations. Since Friday, the standoff has grown more tense as police moved in to disrupt the sit-ins, resulting in clashes that injured people from both sides. VOA correspondent Steve Herman visited industrial zones which have become a focus of Myanmar's fledgling workers rights movement.
Video

Video Oscar Winners Do More Than Thank the Academy

The Academy Awards presentation is Hollywood’s night to reward the best movies from the previous year. It’s typically a lot of glitter, a lot of thank you’s, a lot of speeches. But many of this year’s speeches carried messages beyond the thank you's. VOA’s Carolyn Presutti takes a look.

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More