Sequestration Transparency Act Not a Success

Posted July 30, 2012 at 2:57pm

There was probably the legislative equivalent of high-fives all over Capitol Hill last week, when the Senate followed the House and cleared the Sequestration Transparency Act.

After all, it’s not often these days that any legislation, let alone something dealing with the budget, is approved with overwhelming bipartisan support. And it was indeed both overwhelming and bipartisan: The Senate did the almost unthinkable, passing a budget-related bill by voice vote a week after the House approved it 414-2.

But despite the vote, the bill is anything but a success story. Indeed, it represents so many levels of failure that its eventual enactment (the White House has already indicated the president will sign it and, given the two-thirds support in both Houses, an override would be very likely even if it were vetoed) is anything but a cause for celebration.

The STA corrected an obvious flaw in the Budget Control Act, the law adopted with so much fanfare last August that increased the debt ceiling, created what turned out to be an anything-but-super committee to come up with a deficit reduction plan, and produced the sequestration process if, as ultimately (if not inevitably) happened, the committee failed.

But because of the speed with which the BCA was developed, it didn’t include a requirement that the president reveal in advance which programs would be cut if the sequester occurred. And unlike the situation with the sequesters created by the Gramm-Rudman-Hollings Act in the 1980s, the BCA inadvertently or otherwise gave the president great discretion on how the required spending reductions could be achieved.

The White House wasn’t required to tell anyone before Jan. 2, 2013, and certainly not before the elections, which programs were on the cutting block. That effectively made a deal to prevent the sequester from occurring far more difficult because those who might be affected by the cuts either didn’t know what was coming, couldn’t be sure their preferred program would be hurt or simply assumed it would be protected. As a result, there has been less pressure on Congress and the White House to come up with an alternative to the sequester and prevent the spending reduction part of the fiscal cliff from going into effect.

The fact that the STA was needed means that the legislative process failed. The Budget Control Act was put together at the very last minute, after multiple other efforts had crashed, without the kind of hearings and other reviews that could have made the STA unnecessary. A more deliberative process would have made the decision to not require the president to specify in advance what would be cut intentional rather than inadvertent. That would have made at least the spending cut part of the fiscal cliff less likely and, therefore, would have spared us some of the economic angst of the past few months and the additional heartburn that is still ahead.

But what’s most disconcerting is that the political and economic conditions that led directly to the legislative fail last August will only be more intense during the lame-duck session of Congress that’s coming. The BCA cliffhanger was limited to the debt ceiling; this December it could be the debt ceiling, the extension of multiple existing tax cuts, funding to prevent a government shutdown, the sequester, the deficit and constant projections that the economy will suffer significant short-term damage if the situation isn’t handled correctly. Add to that the usual serious problems of legislating in a lame-duck session and the hyperpartisan environment in Washington that has only gotten worse since the Budget Control Act was put in place, and seeing the Sequestration Transparency Act as a sign of failure rather than a success is not all that hard.

On top of that, it’s not even clear that the STA will work as planned or hoped.

As I read the measure, the president is required to submit a plan to Congress about how the sequester could be implemented within 30 days of enactment. But the STA doesn’t say that this has to be the president’s preferred plan. To the contrary, the language in the bill seems to indicate that the president is required only to apply the rules included in the sequester provisions of the Budget Control Act as they are written but not to make irrevocable decisions about which programs will be completely or partially spared and which others will get cut more as a result.

The STA also doesn’t appear to prevent the White House from providing multiple scenarios. It does not, for example, stop the report from showing what would happen both if the president used and didn’t use the discretion granted to him in the BCA to exempt military personnel from the sequester. It also doesn’t say that the report the president submits to Congress is binding or that the White House cannot change its mind about how the sequester-required spending reductions will be implemented.

That means that the high-fives on Capitol Hill almost certainly were premature and may well have been totally misplaced. The required report is at least as likely to be meaningless as meaningful and, given that the report will have to be produced before the elections, my strong suspicion is that it won’t achieve what the STA’s supporters thought they were getting when they voted for it.

Stan Collender is a partner at Qorvis Communications and founder of the blog Capital Gains and Games. He is also the author of “The Guide to the Federal Budget.”