Want to know how we got to sequestration? Start here

President Barack Obama and Speaker of the House John Boehner have been congenial in public appearances together, but the budget debate between their parties is as ugly as it gets. (Source: CNN)
President Barack Obama and Speaker of the House John Boehner have been congenial in public appearances together, but the budget debate between their parties is as ugly as it gets. (Source: CNN)

(RNN) – It is impossible to have an effective conversation on the sequestration of government spending without talking about the 2011 budget crisis.

The two are so closely tied to together – really, one wouldn't exist without the other – that focusing solely on how to prevent imminent spending cuts ignores that there was no real need to put them on the table in the first place.

Rep. Emanuel Cleaver, D-MO, pulled no punches when expressing his views after both sides of Congress emerged from the trenches following a debate that raged for several months: "This deal is a sugar-coated Satan sandwich. If you lift the bun, you will not like what you see." – via Twitter on Aug. 1, 2011, 5:01 a.m.

One day after Cleaver's tweet, President Barack Obama signed the Budget Control Act of 2011 into law. A few days after that, the U.S. was considered less than capable of comfortably fulfilling all its financial debt and its perfect credit rating was downgraded for the first time in history.

Ready, set ... negotiate

A heated debate in Congress two summers ago mushroomed during the middle of the worst economic recession since the Great Depression. Legislators were desperate not only to avoid going into default but to win back the confidence of the country's largest group of creditors – its citizens.

Like the most recent budget deficit squabble, the focus of the debate was whether to raise the debt ceiling – a self-imposed limit determining when the federal government can no longer reasonably pay its debts.

Republicans refused to raise the debt ceiling unless Obama and Democrats agreed to a proposal that included spending cuts for most federal programs, scheduled to take effect Jan. 1, 2013. Negotiations during the "fiscal cliff" crisis pushed the deadline back to March 1.

Those were called sequester cuts, and the reasoning was, they were so damaging, neither side could conceivably allow them to happen. The brutal cuts would force compromise, officials surmised.

The Bipartisan Policy Center wrote on its blog the day Obama signed the legislation into law: "But what happens if they fail to come to an agreement? That's what the 'sequester' is for. It will act as a 'sword of Damocles' hanging over the JSC (Joint Select Committee on Deficit Reduction) in the hopes of forcing action."

The Joint Select Committee, more widely known in Washington as the "super committee," was a 12-person, bipartisan panel created to find budget cuts that would help the government proactively avoid sequestration. It was comprised of an equal number of Democrats and Republicans from the House and Senate.

Some of the key members included newly appointed Secretary of State and former Massachusetts Sen. John Kerry and Sen. Rob Portman, R-OH, once lightly considered as a Republican candidate for president in 2012.

The committee had an original deadline of Nov. 23, 2011, to draft a proposal that would avoid sequestration. But negotiations crumbled and blame passed back and forth between Congress and the White House.

Despite its deadline, Congress still had almost a year to work things out. That didn't happen for two reasons - partisan gridlock and the November elections.

"This Congress is the most polarized in history. Between Republicans, Democrats and median voters, there are not all the moderates that used to cross over," said Victoria Farrar-Myers, a political science professor at the University of Texas at Arlington. "We're not seeing crossover anymore, not seeing outside conversations. We see small groups - gangs of four, gangs of eight - and legislation is being torpedoed by the smallest piece of something.

"The other thing you have to look at is some members of the panel were up for re-election, and they didn't want to do anything to go against their own party."

That failure set the clock in motion and with time almost out, initial spending cuts of $85 billion – $46 billion from the Pentagon – are set to take place and will get progressively steeper during the next decade.

Bargaining positions on the issue have taken a 180-degree turn.

Unlike the fiscal cliff negotiations, when the president looked like the aggressor and House Republicans seemed backed into the corner, Obama conceded to adding the sequester cuts and signed the Budget Control Act.

Mitt Romney made sequestration an issue during the third presidential debate with Obama in October.

At the time, Obama emphatically said those dramatic spending cuts would not take place.

He further condemned the idea of such damaging cuts during a speech on Tuesday, when he called it a "meat cleaver approach."

"Unfortunately, Congress didn't compromise," Obama said. "They haven't come together and done their jobs, and so as a consequence, we've got these automatic, brutal spending cuts that are poised to happen next Friday."

The president's words leave no doubt he is placing the blame on Congress, but Republicans point to two facts: Democrats control the Senate – as they did when this legislation passed – and the president wasted no time signing it into law.

Speaker of the House John Boehner fired back a response shortly after the president's speech.

"Washington Democrats' newfound concern about the president's sequester is appreciated, but words alone won't avert it," Boehner stated in a release. "Replacing the president's sequester will require a plan to cut spending that will put us on the path to a budget that is balanced in 10 years."

It is possible that Republicans strongly insisted on keeping such potentially damaging legislation in the proposal because they were confident their candidate would defeat Obama in the presidential election.

On Obama's watch, the economy struggled and the deficit doubled. The unemployment rate dropped slowly in his first term while gas and food prices went up.

Passing conservative-friendly legislation up to a Republican president whose party also controlled the House would have made it much easier to stop the clock on a ticking time bomb.

However, Obama won his second term and held the upper hand in public opinion by pointing to sequestration as a Republican idea.

He also benefited from some major GOP blunders last year.

"Even political scientists from a history perspective said this person is in trouble," Farrar-Myers said. "He shouldn't have, in all honesty, won re-election. By those indicators alone, I think Republicans felt fairly good going in. But Republicans torpedoed themselves when two of their candidates made controversial comments about women and rape, and they ignored a growing Hispanic community and young people.

"With President Obama being a second-term president, does [sequestration] tarnish his legacy? Yes. But the president has less to lose than Congress does."

The aftermath 

The result of the 2011 legislation was a temporary fix to the country's money problems and a deal no one was happy with.

Although the effect of the legislation was delayed, the fallout of it was immediate.

Three days after Obama signed the Budget Act, Standard & Poor downgraded the U.S. credit rating. Financial markets around the world plummeted, especially the Dow Jones Industrial Average, before seeing marginal spikes in the following week.

The lingering results were a dramatic decrease in public approval of Congress and a stall to what was already a slow economic recovery.

By passing the American Taxpayer Relief Act of 2012 and avoiding the fiscal cliff, Congress only fixed part of the problem. Income tax rates did not revert to pre-2001 levels, and an agriculture bill that kept milk below a ransom price was renewed, but the impending cuts were only delayed.

Cleaver spoke out against the partisanship that led to vicious fights in Congress during his speech at the Democratic National Convention.

"Just as bees cannot sting and make honey at the same time, members of Congress cannot simultaneously make passionate enemies and expect political progress," he said.

Congress members have only days to demonstrate a willingness to listen to the type of reasoning Cleaver offered and learn from their lessons.

If the actions of House Appropriations Committee Chairman Harold Rogers, R-KY, are a gauge, lawmakers are not optimistic this will turn out well.

Rogers is working on a bill to ease financial pressure on the military resulting from the cuts, according to the Washington Post. The bill would allow money to shift among accounts.

Congress is also out of session until Monday, narrowing the time they have to get a deal done.

"I'd like to say I don't think this could happen, but I do think it could," Farrar-Myers said. "Midterm elections are coming up, and both sides are trying to see how far they can take it to the brink. The power of the purse is in Congress, not with the president. All the president can do is try to bring people together."

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