The White House has a month to explain how it will handle across-the-board budget cuts set to take effect early next year, under legislation signed by President Obama on Tuesday.
The new law requires the administration to detail to Congress every account that would be affected, along with the estimated amount of the reduction in each case down to the program, project and activity level. The cuts, formally known as sequestration, would slice about $109 billion in next year’s discretionary spending starting Jan. 2 unless lawmakers and the White House agree on a long-term deficit reduction plan required by last year’s Budget Control Act.
The administration, which maintains that the two sides will eventually reach a deal, has been reluctant to spell out how the looming cuts would affect individual agencies. The Office of Management and Budget only last week signaled that it would begin discussions with agencies on the subject. The scope of the cuts, however, can only be calculated once fiscal 2013 funding levels are known, acting OMB Director Jeff Zients said in a July 31 memo. For now, agencies “should continue normal spending and operations since more than five months remain for Congress to act,” Zients said.
In congressional testimony last week, Zients told lawmakers that sequestration would likely mean a 10 percent cut for discretionary defense spending — assuming uniformed service members are exempted — and an 8 percent reduction for non-defense spending. The effects would likely include hiring freezes and furloughs at the Defense Department, FBI and other agencies, according to the administration.
Obama had no comment Tuesday on the new law, known as the Sequestration Transparency Act. In a statement, House Budget Committee Chairman Paul Ryan, R-Wis., called it “a welcome step” toward public understanding of how sequestration “will affect our national defense and key domestic priorities.”