From the White House, we hear that $85 billion in cuts to the federal budget would be devastating to the national economy and federal programs. From Republicans, we hear that such fears are overblown … that they represent just 2.4 percent of a federal budget that grew by 19 percent since 2008.
In a call with reporters today, Jason Furman, the principal deputy director of the National Economic Council in the White House, predicted the sequester, which starts Friday, would cost hundreds of thousands of lost jobs. The White House wants Congress to extend sequestration until the end of the year in order to negotiate a larger budget deal that includes entitlement and tax reform.
“This is all avoidable,” he said. “There is a much better path.”
But Republicans argue the administration is fear mongering. Even with the cuts, they argue, overall federal spending is still going up.
South Dakota’s state government would lose $8 million for the rest of the fiscal year, and $14 million by the end of the federal fiscal year in September.
According to an analysis by Pew Charitable Trusts, South Dakota leads the nation in federal grants subject to sequestration as a percentage of state revenue. Check out the report here.
But this doesn’t seem to be a huge issue for Gov. Dennis Daugaard. While some governors have been screaming and hollering about sequestration, Daugaard is more understanding of efforts to trim spending. From his spokesman, Tony Venhuizen:
The governor knows that the federal government needs to get its fiscal house in order, and that will mean making cuts. He is not impressed with the habit of creating a series of “crisis deadlines” that are meant to drive compromise, because it creates uncertainty and hasn’t really worked. He also knows that federal funds to states will probably need to be part of the solution, but he hopes that states are treated fairly and that the federal government can give governors flexibility to accommodate the cuts.