Unless Congress can compromise on a deficit-reduction plan, a $1.2 trillion package of spending cuts over the next decade is set to kick in tomorrow, resulting in devastating cuts to Illinois’ federal funding. We take a look at how those cuts will affect the already cash-strapped state.
Unless Congress can compromise on a deficit-reduction plan, a $1.2 trillion package of spending cuts over the next decade is set to kick in tomorrow, resulting in devastating cuts to Illinois’ federal funding.
Federal cuts from the sequester will add up to $85 billion this year alone, just more than 2 percent of the total federal budget. Illinois stands to lose $33.4 million in funding for primary and secondary education, which could put some 460 teacher and teacher aide jobs in limbo. Additionally, there could be a drop in 39,000 students being taught and a reduction in 120 schools receiving aid. Programs that cater to students with disabilities could lose $24.7 million due to the sequester.
“We’re really at a crisis point here in Illinois,” told Elizabeth Parisian, policy director for the labor coalition Stand Up! Chicago, in an interview discussing austerity and unemployment. “Job creation should absolutely be the focus for legislators—now is not the time for austerity that will only get us further and further into our already existing situation of joblessness and poverty.”
Parisian said the solution to addressing violence and improving education is job creation, not cuts.
“Working people need good, decent jobs and they need to earn a living wage,” she said. “It’s completely the wrong track to think we need to cut off funding for programs that the most vulnerable workers in our society rely on.”
Illinois will also experience millions of dollars in cuts to pollution prevention, public safety, domestic violence programs and health and human services, including a $357,000 reduction in funding for vaccinations.
U.S. Rep. Bill Foster (D, IL-11) is expressing his concerns about how the cuts will affect jobs in his district.
“In addition to the deep cuts we face throughout the country to education, first responders and other essential services, our district faces even larger consequences with the possibility of deep cuts to our national labs," Foster said in a statement this afternoon. "Many people in our community work at Fermilab or Argonne – both of which could face significant budget cuts if sequestration goes through. Cutting investments in science and technology is bad nationally for our economic competitiveness and bad for the 11th District which would see ripple effects throughout our local economy."
The U.S. Department of Defense's 2013 budget would be cut by $42.7 billion, or 9.4 percent, over the next seven months. In Illinois, 14,000 civilian Department of Defense employees may see furloughs, which would drop gross pay by some $83.5 million, according to a White House memo. In addition, army base operations would see $19 million in cuts due to sequestration and Air Force funding operations would be reduced by $7 million.
Partisan gridlock in Congress has prevented a legislative solution to the sequester. Democrats are insisting that a plan should include additional new revenues along with spending cuts. Republicans are insisting on an approach that focuses solely on spending cuts.
President Obama has a deadline of 11:59 p.m. ET on Friday, March 1 to sign the sequester order. Illinois jobs could be impacted by the sequester as soon as April.
“Last week I traveled across my district listening to my neighbors who cannot afford the cuts that will go into place under sequestration,” said Duckworth, who said she will take an 8.4 percent salary cut if the sequester kicks in. “(Veterans) didn’t go home until they got their mission accomplished and we shouldn’t go home until we resolve this self-inflicted crisis.”
Foster also lamented on the lack of movement on behalf of Congress and their apparent lackadaisical work schedule in the face of such devastating cuts.
"One of the most distressing aspects of sequestration is the mindless across the board application of these cuts. There are many places where cuts are reasonable and necessary, and in fact larger cuts could be justified, but there are places which are already underfunded where cuts will be felt deeply. I am very disappointed that Congressional Leadership has chosen to convene Congress for less than half of the working days this year, rather than working out the details of a grand bargain based on shared sacrifice," said Foster.
Sponsored by U.S. Rep. Chris Van Hollen (D, MD-8) earlier this month, HR 699, called the "Stop the Sequester Job Loss Now" Act, focuses largely on ending subsidies for oil and gas industries, ending tax loopholes for large corporations and imposing a "Buffett Rule" or a minimum effective tax rate of 30 percent on adjusted gross incomes above $2 million. It has 17 Democratic co-sponsors.
“The time for finger pointing and assigning blame is over,” said Duckworth on the House floor. “I ask unanimous consent to bring up H.R. 699, a balanced bill to replace the sequester with spending cuts and revenues. A measure that would save thousands of jobs.”
A Republican alternative to the sequester, S 16, has only just presented itself this week. Sponsored by U.S. Sen. James Inhofe (R-OK), the bill still calls for $85 billion in cuts, but takes away the automatic, across-the-board nature and allows the Obama administration to determine where to make them.
“During a period where we’re trying to get the economy going, expenditures are more effective in stimulating the economy than cuts,” said Joseph Persky, professor of economics at the University of Illinois at Chicago. “If we felt that we had to deal with the deficit problems, the way to approach them right now would be to increase taxes, but personally I think there’s an argument to be said to hold off right now.”
Persky said now is not the time to be worry about the federal deficit, considering America’s unemployment rate, at 7.8 percent, has stagnated.
“We are in a situation where we should be focused on getting people back to work and we seem to be much more obsessed with the national debt,” he said. “We should get the train moving first.”
A member of the Patriotic Millionaires, former AOL Executive Charlie Fink from Virginia, suggested the best solution for balancing the federal budget would be to generate more revenue.
“These two things I know to be true: there is no problem in business that cannot be solved by more revenue and no business can cut its way out of a budget crisis,” Fink said in a statement.
Boasting a membership of more than 200 Americans with annual incomes of $1 million or more, Patriotic Millionaires serves as a lobbying group to raise taxes on the wealthiest of U.S. citizens.
“With or without the sequester, our problem remains lack of revenue. This was only slightly addressed by higher taxes on the wealthy,” he said. “We must end corporate welfare, and get back to a system where our businesses, along with the most wealthy, contribute to the general welfare that allows our society to thrive, and create opportunity for others.”