With all the political chatter from both parties, it can be a bit of a challenge navigating through the white noise of rhetoric to truly understand what sequestration means to our area. Do we need to be concerned or can we expect to go about our lives with a “business as usual” attitude?
Expect an economic slowdown.
Our military and veteran demographics have a significant impact on the economic health of our region and state. With over 91,000 military-related employees and over 600,000 veterans in this state, sequestration will impact individuals within the state’s counties and cities – including Edmonds.
First let me define sequestration – essentially it means forced budget cuts. Or, as TIME defines it, “Sequestration: to haphazardly cut federal spending at the direction of U.S. lawmakers, who can’t agree on anything more rational.”
Here’s how all this forced reduction issue came about – we all know that Congress has a spending problem. Most know that Congress spends on our behalf more than they take in – in business we call this bad. Congress heard from enough constituents that they had to reel in spending – so they formed a committee and that committee came up with the Budget Control Act of 2011.
The Budget Control Act established a process, known as sequestration, where automatic, across-the-board spending cuts would take effect on March 1, 2013 if the 12 chosen Congressional lawmakers (the committee) could not come to some sort of agreement on reduced spending. The committee failed. As a result, these cuts, according to L2 Federal Resources, “are currently slated to affect both mandatory and discretionary spending and are predicted to produce roughly $108 billion in annual spending reductions through 2021, split evenly between defense and non-defense accounts.”
Yes, that is $108 billion in annual spending reductions…not $85 billion or $45 billion – which are the “media” numbers. Office of Management and Budget also sheds light on agencies affected by cutbacks.
I’ll be the first to admit, budget cuts need to happen; how we cut the budget needs to be executed smartly, which is not happening.
So what does all this mean – like in practical terms? First off, military pay and combat operations won’t be affected…this year at least; and VA programs, including disability benefits and care are exempt from cuts. However, tuition assistance funding for Active Duty was terminated by both the Marines and the Army, and emergency unemployment benefits for a number of Veterans face an 11-percent cut.
Up to 29,000 workers in the Puget Sound area could either be laid off or furloughed – and furlough is just a creative way of saying, “you get a day off without pay every week” until we decide otherwise – which amounts to a 20-percent pay cut.
Say goodbye to discretionary spending…if in fact these families had it.
Bottom line: How sequestration hits the pocket book of families across our region will vary. What will be consistent is the uncertainty that is created among a number of industries and communities that support our military. As a result, we need to think creatively on how to shore up and increase our city revenues or prepare for an economic slowdown.
Michael Schindler, Navy veteran, and president of Edmonds-based Operation Military Family, is a guest writer for several national publications, author of the book “Operation Military Family” and “The Military Wire” blog. He is also a popular keynote and workshop speaker who reaches thousands of service members and their families every year through workshops and seminars that include “How to Battle-Ready Your Relationship” or “What Your Mother-in-Law Didn’t Tell You.” He received the 2010 Outstanding Patriotic Service Award from the Washington State Department of Veterans Affairs.