With the deadline for the much discussed “sequester” just a week away, pundits and politicians on both sides of the aisle see little, if any, chance of escaping $1.2 trillion worth of cuts in spending on everything from defense to social services. According to a new Pew/USA Today poll, 31 percent of Americans blame President of Obama for the failure to come to a deal to avert sequestration, while 49 percent blame Republicans in Congress.
While Republicans and Democrats may agree on the inevitability, they don’t agree on the effect sequestration will likely have on the American economy. Democrats are worried the cuts could trigger a fiscal contraction amounting in a GDP loss of $287 billion this year alone, while Republicans are publicly questioning whether sequestration will really cause the economy any major harm. Should we be readying ourselves for the worst, or is the fiscal cliff really just a slight slope?
Scott Lilly , Senior Fellow, Center for American Progress; Previously, Lilly served as clerk and staff director of the House Appropriations Committee, minority staff director of that Committee, executive director of the House Democratic Study Group, executive director of the Joint Economic Committee, and chief of staff in the Office of Congressman David Obey (D-WI).
Phil Swagel , professor of economics at the University of Maryland and was assistant secretary for economic policy at the Treasury Department from 2006 to 2009. He’s also a visiting scholar at the American Enterprise Institute.