Defense hopes for sequester relief

Defense hopes for sequester relief

The odds of rolling back the sequester are improving with the fight against Islamic militants and the possibility that Republicans will control the Senate, budget experts and defense firm analysts say.

While repealing the automatic spending cuts is unlikely and even easing the cuts remains an uphill climb, opponents believe they have new, favorable arguments on their side.
Those talking points include the falling budget deficit and the emerging twin threats of Ebola and the Islamic State in Iraq and Syria.

“I think there is significant hope for an adjustment, but it may be taken in stages,” said Geoff Davis of Republican Consulting, a former member of the House Armed Services Committee.

“My view is that we should get rid of it all together but political realities call for triage. First thing we have to do is stop the bleeding and clear the air way,” he said.

Defense firms have clamored for relief from the sequester, though they’ve been reluctant to stick their necks too far out publicly.

“The industry is not being passive but it’s afraid to get involved in political matters,” said Loren Thompson, a consultant who works with multiple contractors. “Industry hates sequestration but no one wants to be seen as being too partisan, one way or the other.”

The political problems facing a new Congress are familiar.

The 2011 Budget Control Act that introduced the sequester imposed equal cuts on domestic and defense spending. President Obama has been unwilling to replace cuts to the Pentagon without a commitment from congressional Republicans to ease cuts on the domestic side.

But budget analysts see the 2013 two-year budget deal by House Budget Committee Chairmen Paul Ryan (R-Wis.) and Senate Budget Committee Chairman Patty Murray (D-Wash.) as something that could be repeated next year.

“The only really feasible solution is a small deal that raises the defense budget caps by $5 to $10 billion and also raises the non-defense budget caps by the same amount,” said Todd Harrison, senior fellow at the Center for Strategic and Budgetary Assessments.

There’s a “pretty good chance, greater than 50 percent” that Congress could strike another small deal like Ryan-Murray, he said.

The Ryan-Murray budget deal set ceilings on defense spending in fiscal year 2014 and fiscal year 2015 at $520 billion and $521 billion, respectively. The deal also set non-defense caps at $492 billion in those two years.

For fiscal year 2016, under the sequester caps, defense spending would be limited to $523 billion — an increase of just 0.06 percent. In fiscal year 2017, it would be limited to $536 billion.

Read More:Defense hopes for sequester relief | TheHill.

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