The Sequester Game of Chicken
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The Fiscal Times
March 1, 2013

It was said of the French arististocracy before the revolution that they learned nothing and forgot nothing. So too with the Republican Party, which is still fighting budget battles from the past. The sequestration battle cannot be understood outside this context.

The critical subtext for today’s sequestration battle is the 1995 government shutdown, in which Bill Clinton not merely beat congressional Republicans, but humiliated them. Sequestration is their revenge.

When Republicans took control of Congress in 1994, they were full of themselves. I know. I was in many meetings at which plans were formulated for what they would do with this extraordinary opportunity.

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Recall, too, that Republicans hadn’t held both houses of Congress since 1954 and had essentially been out of power almost continuously since 1932. That is a long time for one party to be shut out of power on Capitol Hill. Republicans were giddy when they finally regained it.

Republicans deluded themselves that their election represented a fundamental shift in the nation’s ideology; that a majority of Americans finally wanted government slashed to where it was small enough to drown in a bathtub.

That was false. Republicans misinterpreted a shift in party alignment with a shift in ideology. In fact, Americans were no more conservative than they had always been. The only difference was that there was no longer a large bloc of conservatives in the Democratic Party.

Democratic conservatives, the vast bulk of whom were Southerners, had been shifting into the Republican Party for 20 years; by 1994 the shift was complete. This shift had little to do with ideology and more to do with political forces set in motion by the civil rights revolution of the 1960s.

 

Nevertheless, Republicans sincerely believed they had a mandate from the American people to slash government. In their hubris, they tended to forget that Democrats still held the White House. When this fact was called to their attention, it was dismissed as no more than a speed bump on the road. Congress made the laws—that’s all that mattered, Republicans thought.

The Republicans’ strategy centered on the annual appropriations bills that Congress must pass to keep the government from shutting down. They believed that during the 1980s, Democrats had used the threat of a government shutdown to bludgeon Ronald Reagan into backing down from implementing conservative policy.

Hence, Republicans thought they held all the high cards when the fiscal year ended on September 30, 1995. They would simply refuse to fund the government until Clinton surrendered to their agenda. Republicans also thought they could hold an increase in the debt limit hostage to their demands.

Among the Republican demands was a sharp cut in Medicare in order to prevent a government shutdown and default on the debt. Clinton refused to accept these demands and the government shut down in November.

Rather than force Clinton to back down, Republicans backed down when blowback from the shutdown landed mainly on them. The public primarily blamed the leader of the budget hardliners, House Speaker Newt Gingrich, whom they viewed as a petulant child.

Ever since then, Republicans have been seeking revenge. When they regained control of Congress in 2010, the same hubris that infected them in 1995 returned with a vengeance. In the summer of 2011, they held the debt limit hostage to their demands to slash government. A default on the debt was avoided only when Democrats agreed to an automatic $1.2 trillion cut in appropriations beginning on January 1, 2013, which was subsequently delayed to today.

Just as in 1995, Republicans believe they hold all the high cards. They are 100 percent certain that Barack Obama will buckle and accede to their demands because voters will blame him, rather than them, for any negative consequences resulting from sequestration. The fact that polls universally show that people primarily blame Republicans in Congress appears not to have penetrated their consciousness.

My guess is that the sequestration will be of short duration. In fact, it will last exactly until March 27. That is the day when the appropriations for fiscal year 2013, which began on October 1 last year, run out. Republicans have persistently refused to do their basic work by funding the federal government because they think, just as they did in 1995, that the threat of a government shutdown will force a Democratic president to bow to their will.

Thus far, there is no evidence that Obama is in a mood to be rolled by Republicans. He does not have to run for re-election and he feels confident that the public will blame Republicans in Congress rather than him when the you-know-what hits the fan. I think he believes the government can weather a brief sequester and that Republicans will, ultimately agree to end it when they are forced to finally pass 2013’s appropriations.

I think this is a reasonable assumption. A new report from the Bipartisan Policy Center notes that past sequesters have never been permitted to run their course. It’s such an incredibly stupid way to cut spending that Congress has always relented.

It’s childish and immature for Republicans to behave as if control of one house of Congress somehow gives them a mandate to impose their will on the entire government. But such is the sad state of the Republican Party today, in which a desire to avenge past slights carries more weight than responsibility does.

Bruce Bartlett’s columns focus on the intersection of politics and economics. The author of seven books, he worked in government for many years and was senior policy analyst in the Reagan White House.