$54.7 billion in annual non-defense cuts begin in 2013 Includes Affordable Housing and Homelessness Programs
On Tuesday, November 22, 2011, members of the Joint Select Committee on Deficit Reduction, “the Super-Committee”, announced that they were unable to come to a bipartisan agreement on deficit reduction by their deadline.
Their inability to reach a consensus will result in automatic sequestration, which involves gradual cuts to both non-exempt defense and non-defense accounts beginning in January 2013 and lasting through FY 2021.
Many programs assisting low-income people are technically exempt from sequestration, though affordable housing and homelessness programs are not exempt.
In light of the Super-Committee’s inability to produce a plan, some legislators have begun discussing the possibility of repealing or altering sequestration; however, it is very unclear whether this is a politically or legislatively viable option.
According to the Center for Budget and Policy priorities (CPBB), “The $54.7 billion in annual non-defense cuts would come from both mandatory (entitlement) and discretionary programs.”
$16.1 billion of the $54.7 billion in annual non-defense cuts would come from mandatory programs. This share would grow from year to year, reaching $22 billion by 2021.
The remaining non-defense cuts — about $38.6 billion in 2013 — would come from discretionary programs:
For fiscal year 2013, the non-defense cuts would occur through across-the-board, proportional reductions in new funding for each discretionary program in the appropriations bills for the fiscal year, which Congress would already have enacted.
For fiscal years 2014 through 2021, the cuts would occur through reductions in the statutory cap on total funding for non-defense discretionary programs for each of those years. The Appropriations Committees would then decide how to live within those newly reduced caps.
The $38.6 billion reduction in the non-defense discretionary caps would shrink from year to year, to $33 billion by 2021, because the mandatory cuts would grow and thus would account for somewhat more each year of the $54.7 billion in total non-defense cuts.