How Sequestration Could Spoil Your Day

It'll be felt everywhere, from education to transportation to food

   

NewLetters How Sequestration Could Spoil Your DayEveryone ready for Sequester Friday?

It looks almost certain that Congress will fail to cut a deal that would prevent government-wide spending cuts. If no last-minute agreement is reached, more than $85 billion of spending will be trimmed from the federal budget in 2013 alone.

That’s a pretty big number.

Still, whether because of crisis fatigue or the simple fact that March Madness is almost upon us, most Americans really don’t seem to be freaking out.

Only a little more than half of all Americans believe the nation’s economy will suffer this year thanks to sequestration, according to a recent Gallup Poll. On top of that, only 44% believe sequestration will harm their own finances, while a percentage point more think it won’t worsen their financial situation at all.

Individual situations aside, however, it’s clear that just about all Americans will indeed feel the effect of sequestration in one way or another. Here are the many ways Congress’ inaction could spoil your day:

Education

  • Countless schools will feel the squeeze from budget cuts. With less money to work with, schools are set to lose teachers and programs, although most public school districts won’t really be affected until the start of next school year.
  • According to Education Week, a recent survey of superintendents said they are “anticipating reducing professional development, cutting programs, and laying off some staff” as a result of sequestration.
  • The U.S. Secretary of Education has said that 40,000 teachers could lose their jobs.
  • The losses are skewed to hit poor programs hardest.
  • More specifically, the early childhood program Head Start and campus-based aid programs like Work Study are a few that could get the axe.
  • In good news, student loans and Pell Grants are exempt from getting cut.

Defense

  • The bulk of spending cuts come from defense and national security. According to NPR, some effects have already been felt in terms of defense. The Navy didn’t send a carrier to the Persian Gulf, for example, even though it’s something the organization has been doing for years. Plus, some Army units already have postponed training.
  • Air Force and Navy aircraft procurement will be cut by more than $4.2 billion, while Defense Department operations and maintenance will shed $3.9 billion just this year.
  • In terms of employees, more than 800,000 Pentagon civilian workers will be furloughed one day a week for the rest of the year.
  • Many military leaders also insist that, if this goes on for a long time, America will be a second-rate military power — making citizens supposedly less safe — because of a lack of training and funds.

Health

  • Medicare — the program from the elderly and those with disabilities — could see cuts to healthcare providers like doctors, hospitals and insurance companies.
  • Total payments to hospitals through Medicare could be cut by more than $5.8 billion, while prescription drug benefits could be trimmed by $591 million, according to The New York Times.
  • Other federal programs like the National Institutes of Health and the Centers for Disease Control and Prevention could be subject to cuts. That could mean less medical research, for one.
  • All in all, public health services that deliver direct patient care are expected to see cuts of around 9%. NPR experts estimate around 900,000 patients wouldn’t be able to get care this fiscal year as a result.
  • The good news is that Medicaid is exempt from any cuts.

Food

  • Furloughs for U.S. Department of Agriculture employees could disrupt the food chain.
  • A lack of safety inspectors — not just for fresh meat, but frozen pizza, burritos, packaged vegetables and so on — will mean shutting down around 6,000 businesses who rely on their work for over two weeks.
  • This could result not just in shortages, but also in raised prices, according to an NPR interview. Ranches and feed lots also will have to hold animals longer, which would hurt profits … and such costs could be passed onto the consumers.
  • Nutrition programs for women, infants and children will lose $543 million.

Flying

  • The Department of Transportation itself is facing about $1 billion in cuts.
  • More than 47,000 Federal Aviation Administration employees will face furloughs.
  • Of that group, more than 14,000 air traffic controllers will have to sit out one or maybe two days per pay period. Experts say this means air traffic control towers will not be staffed properly.
  • For day-to-day folks, this could mean significant flight delays and travel complications.

Other

  • In terms of economic impact, the Congressional Budget Office expects half a percentage point of GDP to be lost this year, along with 750,000 jobs.
  • The traditional flyovers at sporting events also will be grounded for at least the remainder of the year.
  • Athletic department spending at service academies is expected to be trimmed, according to USA TODAY.
  • The Library of Congress will lose its books for the blind and handicapped.
  • Hours at popular national parks could be limited, according to Fox News.

The opinions contained in this column are solely those of the writer.

Want to share your own views on money and politics? Drop us a line at letters@investorplace.com and we might reprint your views in our InvestorPolitics blog! Please include your name, city and state of residence. All letters submitted to this address will be considered for publication.


Article printed from InvestorPlace Media, http://investorplace.com/investorpolitics/the-many-ways-sequestration-could-spoil-your-day/.

©2014 InvestorPlace Media, LLC

Comments are currently unavailable. Please check back soon.