Beneath the Drama

Many of the questions swirling around sequester have become stock, but yesterday ADM James Winnefeld, Vice Chairman of the Joint Chiefs, was asked a new one.  Recognizing that Congress frequently relies on continuing resolutions to fund the government at the start of fiscal years, what happens when caps require spending cuts, as is the case in 2013?

The answer is less climactic than the scenario might imply.  Continuing the 2012 national defense budget of $554.7 billion would in fact exceed the 2013 cap of $546 billion and, in the realm of statutory abstraction, trigger a mini-sequester to restore the cap.  Note that this would be entirely separate from the supercommittee-driven sequester scenario and instead part of a  more regular process in which OMB prepares a budget finding at the end of each congressional session. 

But that’s unlikely to happen.  Congress can and does use Continuing Resolutions to make changes on the margins.  Recall the agonizing 2011 appropriations process in which it extended the CR through March 18^th in exchange for $4 billion in cuts and again through April 8^th with a corresponding $6 billion cut.  (For those that want the nitty-gritty, see the CBO scoring.)  In fact, this exact issue came up last October when Congress included a blanket 1.5% cut in that Continuing Resolution to meet the 2012 caps.

Just because 2013 might start with a Continuing Resolution doesn’t mean that it has to invoke the high drama of violating a spending cap.  To the contrary, there very well may be a Continuing Resolution in October, and Congress almost certainly will reconcile it and the cap.