Sequester Fear-Mongering, State Version

The extent to which the media is aiding and abetting, with absolutely no skepticism, the sky-is-falling sequester reaction of pro-big-government forces is just sickening.  I have never seen so many absurd numbers published so credulously by so much of the media.  Reporters who are often completely unwilling to accept any complaints from corporations as valid when it comes to over-taxation or over-regulation are willing to print their sequester complaints without a whiff of challenge.  Case in point, from here in AZ.  This is a "news" article in our main Phoenix paper:

Arizona stands to lose nearly 49,200 jobs and as much as $4.9 billion in gross state product this year if deep automatic spending cuts go into effect Friday, and the bulk of the jobs and lost production would be carved from the defense industry.

Virtually all programs, training and building projects at the state’s military bases would be downgraded, weakening the armed forces’ defense capabilities, according to military spokesmen.

“It’s devastating and it’s outrageous and it’s shameful,” U.S. Sen. John McCain told about 200 people during a recent town-hall meeting in Phoenix.

“It’s disgraceful, and it’s going to happen. And it’s going to harm Arizona’s economy dramatically,” McCain said.

Estimates vary on the precise number of jobs at stake in Arizona, but there’s wide agreement that more than a year of political posturing on sequestration in Washington will leave deep economic ruts in Arizona.

Not a single person who is skeptical of these estimates is quoted in the entirety of the article.  The entire incremental cut of the sequester in discretionary spending this year is, from page 11 of the most recent CBO report, about $35 billion (larger numbers you may have seen around 70-80 billion include dollars that were going away anyway, sequester or not, which just shows the corruption of this process and the reporting on it.)

Dividing this up based on GDP, about 1/18th of this cut would apply to Arizona, giving AZ a cut in Federal spending of around $2 billion.  It takes a heroic multiplier to get from that to  $4.9 billion in GDP loss.  Its amazing to me that Republicans assume multipliers less than 1 for all government spending, except for defense (and sports stadiums) which magically take on multipliers of 2+.

Update:  I wrote the following letter to the Editor today:

I was amazed that in Paul Giblin’s February 26 article on looming sequester cuts [“Arizona Defense Industry, Bases Would Bear Brunt Of Spending Cuts”], he was able to write 38 paragraphs and yet could not find space to hear from a single person exercising even a shred of skepticism about these doom and gloom forecasts.

The sequester rhetoric that Giblin credulously parrots is part of a game that has been played for decades, with government agencies and large corporations that supply them swearing that even trivial cuts will devastate the economy.  They reinforce this sky-is-falling message by threatening to cut all the most, rather than least, visible and important tasks and programs in order to scare the public into reversing the cuts.  The ugliness of this process is made worse by the hypocrisy of Republicans, who suddenly become hard core Keynesians when it comes to spending on military.

It is a corrupt, yet predictable, game, and it is disappointing to see the ArizonaRepublic playing along so eagerly.


  1. LarryGross:

    Dem "pork" = entitlements, GOP "pork" = DOD

  2. bigmaq1980:

    Pork is Pork and we have $1T+ of baconated government.

    1% ($40B) out of $3.6T budget should not mean automatic 90 minutes in TSA lines...come-on!

    The government is playing a game with us...take these small cuts and make sure we, the citizens, "feel it", so we don't get the foolish idea that there should be cuts again in the future.

  3. LarryGross:

    surely that can't be the GOP "strategy", eh? What is this for them right now?

  4. nehemiah:

    Almost got it right. Dem "pork" = entitlements plus all forms of government spending minus DOD.

  5. marque2:

    I don't understand all the hype either. It is a one time cut of 100 billion - though by fake accounting they make it seem like a trillion will be saved.
    Instead of looking at the total "savings" over ten years we should look how it affects the budget.

    In ten years it is projected our government spending will be:
    $5.9 trillion

    With the sequester in place our government spending in 10 years is projected to be.

    $5.8 trillion.

    Big whoop.

  6. MingoV:

    The media's squawking about a less than 1% cut in federal spending is absurd. Obama's first (and only) budget increased federal spending by 37%. Most of that increase was for a 'one-time' stimulus. But, (surprise, surprise) the deliberate failure to pass budgets allowed the high spending to continue. Why doesn't the media mention that prolonged massive spending increase? Why doesn't the media demand a 30% cut in spending? After such a cut, federal spending still would exceed Bush's last budget, a budget that Senator Obama said was irresponsibly high.

  7. SamWah:

    1%, even 2%, is not drastic. 20% would be drastic...or maybe just a really good start.

    And there's much less GOP pork than Dem pork.

  8. Todd Ramsey:

    John McCain is the anti-libertarian.

  9. AnInquirer:

    I will agree with the conclusion that it the federal government should be able to handle this sequestration, but here are two reasons why it seems more painful: 1) Probably 70% of federal budget is exempt of sequestration, so we get up to a noticeable % when we look at the cut in the non-exempt areas. 2) we are now looking at doing a full year's sequestration within 5 or 6 months -- the impact will be more concentrated.
    But I continue to be amazed at management decisions. I now work for the federal government, and we are hiring an amamzing number of new employees. Finally, one little old lady spoke up: "If we didn't hire all these extra employees, we would not need to have such a big hit on our salaries when the furlough happens." Management's response: "The new employees will be furloughed just like you will be. The burden will be evenly distributed." Seems to me, management missed her point entirely.