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The 'sequester' has landed: Just how 'automatic' will spending cuts be? (+video)

Department heads and agency chiefs will have some flexibility to move 'sequester' cuts between accounts and to decide their pacing. But wiggle room is limited under the law, budget experts say.

Correspondent Liz Marlantes with insights into the politics behind the impending spending cuts.
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President Obama on Friday railed against the idea of “arbitrary” across-the-board cuts to federal spending. But the idea is now a budgetary reality.

As a result of a political impasse between Mr. Obama and Congress, the deficit-taming vehicle called the “sequester” is poised to hit the road. So, what does it mean for various government agencies to actually implement this thing? Does the law allow bureaucrats any wiggle room to prevent, say, a predicted shortage of air traffic control workers?

By law, the sequester is designed to cut about $85 billion during the current fiscal year (which ends Sept. 30), half from the defense side of the budget, half from the nondefense side. This will amount to a reduction of 8 percent in the defense budget (excluding for personnel) and 5 to 6 percent on the nondefense side, estimates the Congressional Budget Office

“The law says the sequestration is exactly proportional account by account” in the federal budget, says Richard Kogan, an expert at the Center on Budget and Policy Priorities. “And the law means it.”

That said, the budget-trimming mechanism called sequester does give agencies some flexibility, he adds.

First, spending by each federal department is guided by appropriations laws, which often provide a degree of leeway to transfer modest amounts of money from one of a department's “accounts” to another. For the Department of Defense, for example, one example of an account is Army "missile procurement" and another is Army "ammunition."

A second form of wiggle room is called “reprogramming” within a given budget account. Agencies can move money from one activity or project to another – even though the sequester in theory hits each activity to the same degree. The Army could, for example, spend more on one kind of helicopter and less on another under the account called “aircraft procurement.”


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