Politics Could Kill 1 Million Jobs By 2014
The new normal in American politics seems to be the unending fiscal crisis. First the debt ceiling was threatening job growth, then it was the fiscal cliff, and now it's sequestration. On March 1, $1.2 trillion in spending will be cut automatically over 10 years -- from across the federal government, in both defense and non-defense -- if Congress doesn't agree to a deal to reduce $85 billion from the budget.
Congress came up with $1.2 trillion in cuts as a political compromise for the debt ceiling crisis. No matter how this year's Beltway squabbling is resolved, it could have real consequences. The only question for workers is -- will it translate into job losses? And which sectors would be hurt most?
How many jobs would vanish?: Estimates vary. Douglas Elmendorf, of the Congressional Budget Office, put the figure at 750,000, according to BuzzFeed. The Bipartisan Policy Center, an respected, independent think tank, estimates 1 million jobs would vanish by the end of next year, due to businesses cutting back on activity and the resulting loss of gross domestic product.
The impact would be be felt by a range of small business and public sector workers, the BPC says. Those who work the National Weather Service's radar, for instance, might be laid off as as the NWS plans to shut down the radar on sunny days, according to The Washington Post. Aerospace workers and public health employees are also at great risk. "The slowdown of business activity due merely to the possibility of a sequester has already led to reductions in workforce among defense contractors and sub-contractors," the BPC said.
automatic budget cuts. Unless the sequestration is averted, federal defense spending will be cut roughly 16 percent, resulting in the loss of $55 billion over the next months, the BPC said. One-day-a-week furloughs already have been planned for the 800,000 civilian employees at the Defense Department, and also likely to feel the hurt are military contractors, according the Military.com.
In his State of the Union speech, President Obama made clear where he stands in the ongoing negotiations. Any attempt to make "cuts to things like education and job training, Medicare and Social Security benefits" to avoid defense cuts is an "even worse" idea than simply accepting the defense cuts themselves, he said.
This go-round in the never-ending drama may in fact end without a resolution. That's the prediction of House Budget Committee Chairman Paul Ryan, among others, according to The Hill. However the sequestration turns out, the resolution of the country's fiscal crisis will surely not be settled. And on May 18, Congress will face a new deadline for the debt ceiling.
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