University Presidents Call for Balanced and Smart Deficit Reduction

The defense portion of the sequester that will hit on January 2 of next year has garnered a lot of attention, but it is not the only part of the automatic cuts. The sequester will also make cuts to non-defense discretionary spending and and certain other mandatory programs (many low-income programs are exempted). Recently, other parts of the sequester have started to receive attention.

A POLITICO article this morning shows a letter that Department of Health and Human Services Assistant Secretary for Financial Resources Ellen Murray sent to Rep. Ed Markey (D-MA), detailing the effect the sequester would have on HHS programs. Of course, the effect is widespread: everything from National Institutes of Health funding to Head Start to substance abuse treatment programs will be hit indiscriminately.

In addition, yesterday a group of university presidents representing the Association of American Universities and the Assocation of Public and Land-Grant Universities sent a letter to the President and Congress arguing for replacing the sequester with a comprehensive deficit reduction plan to avoid both the fiscal cliff and rising debt. Sounds pretty similar to what CRFB has been arguing! Here is what they had to say:

Sequestration is an undiscerning and blunt budget tool that would substantially harm our nation’s future by blindly slashing valuable investments in education and scientific research, as well as other important discretionary programs that provide health, economic, and national security. There is much public discussion about the impact of sequestration on the defense budget but little about the proposed indiscriminate cuts to the non-defense discretionary budget. Deficit reduction until now has concentrated almost entirely on non-defense discretionary expenditures, which are only about one-sixth of the budget. Spending on these programs is not the primary cause of our rising debt. Wholesale additional reductions in these and other programs that educate and train the next generation risk undermining our nation’s human capital, infrastructure, technological, and scientific needs.

A prudent and effective deficit reduction agreement should seriously and thoughtfully address a primary source of long-term spending growth: entitlement programs. Entitlement programs account for a large percentage of the budget, and they are projected to take an increasing share of federal spending in the coming decade. However, the sizable deficit reduction required cannot be achieved solely through decreasing expenditures. Substantial tax reform that is designed both to encourage economic growth and to raise revenues needed to reduce the deficit should also be part of the package.

Certainly, we would agree with their assessment of the budget situation. Click here to read the full letter.