Microeconomics Sequestration

Topics: Barack Obama, President of the United States, Democratic Party Pages: 2 (624 words) Published: April 21, 2013
Haley Davis
Microeconomics TC1
Bonus #2

Sequestration is a series of automatic, across-the-board cuts to government agencies. The cuts are split 50-50 between defense and automatic discretionary spending. The sequestration was enabled to get a handle on the growth of the United States national debt. The U.S debt stands at more than $16 trillion as of today. The sequestration started with the 2011 standoff over the U.S debt ceiling, when Republicans in Congress demanded spending cuts in exchange for giving the Obama administration to pay the federal government’s obligations to its bondholders. Many wonder what were they thing, but the plan was that a special congressional panel would find a less painful way to cut spending. More than $500 billion will be cut from the Defense Department and other national security agencies, with the rest cut on the domestic side such as, national parks, federal cuts, the FBI, food inspections and housing aid.

Talk is going around on how the President is handling the sequestration. President Barack Obama speaks to a reporter after meeting with congressional leaders regarding the automatic spending cuts. The headline of the article of The Guardian is, Obama says he can`t force sequester deal: `I`m not a dictator. ` President: sequester is `a series of dumb, arbitrary cuts. ` President Obama and congressional leaders failed to reach a deal after the deadline of the sequester. Both sides agreed that $85 billion in automatic budget cuts would be bad for the economy. Obama, “These cuts will hurt our economy; they will cost us jobs.” Obama said debt reduction should include both spending cuts and higher taxes in the wealthy, calling it a “balanced plan” that can end cuts that will slow the economy, cost people jobs and possibly undermine national defense. The president is expected to sign a formal sequestration order.

The Senate`s top Republican Mitch McConnell called the meeting “An opportunity to restate our commitment to...
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