Conceding that budget work won’t be completed by March 1, “when a series of harmful automatic cuts to job-creating investments and defense spending — also known as the sequester — are scheduled to take effect,” President Obama on Tuesday urged Congress to approve “a smaller package of spending cuts and tax reforms that would delay the economically damaging effects of the sequester for a few more months until Congress finds a way to replace these cuts with a smarter solution.”
Another delay would be the second after sequestration was originally scheduled to take effect Jan. 1. While another delay would put off harsh budget cuts, it would extend the period of uncertainty that is particularly vexing for the federal workforce.
If imposed, sequestration’s economic damage would fall more heavily on federal employees than on anyone else. In addition to the potential cuts in service that all Americans would suffer under sequestration, federal employees would probably find smaller paychecks because of unpaid leave. Furloughs would be on top of previous cuts that amount to a $103 billion hit on federal compensation over 10 years.
“There is no reason that the jobs of thousands of Americans who work in national security or education or clean energy, not to mention the growth of the entire economy, should be put in jeopardy just because folks in Washington couldn’t come together to eliminate a few special-interest tax loopholes or government programs that we agree need some reform,” Obama said.
Despite Obama’s efforts, the move to sequestration seems to have hastened in recent days. Congress “basically has washed its hands” of trying to find an alternative, “which I find totally unacceptable,” said William Dougan, president of the National Federation of Federal Employees.
Congress “created Frankenstein and is totally amazed that it is coming to life,” he added. “They created sequestration in the first place and it is their problem to fix.”
As sequestration moves closer to reality, so do furloughs.
The Office of Management and Budget told federal union leaders Monday it was preparing language that agencies could use to inform employees that furloughs are a possibility in less than a month.
A draft memo says the administration may “have to consider placing employees on temporary furlough, or taking other personnel actions, should sequestration occur.” The draft also says that to deal with “the rigid nature of the cuts imposed by Congress,” administration officials “are closely examining contracts, grants, and other forms of expenditures.”
The document acknowledges that the actions “could mean making cuts to vital programs or curtailing spending on contracts.” Also possible are reductions in “operational or administrative costs in areas such as travel, training, facilities, and supplies.”
Although the draft says the OMB is examining contracting expenses, J. David Cox Sr., president of the American Federation of Government Employees, complained that the “OMB still hasn’t given agencies any useful or explicit guidance for reducing spending on service contracts.”
While a range of cuts affecting federal employees are on the table, the “OMB hasn’t ordered any companion cuts on the contractor side of the house, such as a freeze on new service contracts, freezing the exercise of contract options and freezing approval of contract modifications,” Cox added.
Meanwhile, an aide to Rep. Steny H. Hoyer (D-Md.) confirmed a Federal Times report that he could consider additional cuts to federal compensation if they were part of a large, comprehensive deficit-reduction plan. This is significant because Hoyer is the second-ranking Democrat in the House and a staunch supporter of federal employees.
“I strongly oppose efforts that continue to single out” federal workers, Hoyer said in a statement to the Federal Diary. “While Congress must enact a comprehensive plan to address our fiscal challenges,” he added, “it is unfair and unwise to put the burden of deficit reduction solely on one group of working Americans.”
But don’t be surprised if a larger plan includes additional hits on federal employees.