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Understanding the Implications of Sequestration

It is critical that policymakers begin to understand the possible implications of the automatic, across-the-board budget cuts included in the Budget Control Act.

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Much has been written about the automatic, across-the-board budget cuts contained in the Budget Control Act of 2011, otherwise known as “sequestration,” but many critical questions remain regarding official interpretations of the legislation and how it will actually be implemented on an agency-by-agency basis. These include questions as to exactly which governmental spending accounts are or are not subject to sequestration, how deep the percentage reduction will be in the accounts that are subject to sequestration, how much latitude agencies have in selecting the specific expenditures that will be cut, and what the offsetting expenditures will be in implementing the proposed cuts. 

It is nonetheless critical that policymakers begin to understand the possible implications of the legislation particularly with regard to critical governmental services that may impact the broader economy and public safety as well as the degree to which specific sectors of the economy will be impacted and the long-term implications for performing the missions assigned to government agencies in an efficient and cost-effective manner. To do so, however, requires considerable degree of subjective judgment at this point in time.

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