Why The Congressional Majority Likes SequesterFebruary 26th, 2013 12:36 pm Howard Hill
We hear that 800,000 civilian employees of the Department of Defense will get an automatic 20-percent cut in hours and pay. That’s a hell of a lot more than the percentage cut to the Department. Why? Because nobody is cutting the pay to contractors that are non-human “persons.” In fact, some defense contractors are going to enjoy a windfall, as they charge higher unit prices if the number of planes, jet engines or whatever being delivered on existing contracts is cut below volume discount levels.
And nobody really imagines the government won’t be back later to buy them, just that they’ll be delayed, and the government will pay a higher price per unit in the meantime. So there you have it — increased profit margins for corporations, all the real cuts applied to wage earners. What’s not to like?
If the cuts were to profit margins or across-the-board three-percent cuts to the price paid, then you’d see the House compromise to fix this.
A true skeptic might say that when the pain of budget cuts hits supporters of the PACs and the Tea Party astroturf outfits, the cuts will be more sensible, and we might even see a few unwarranted tax loopholes get closed to help narrow the deficit.
AP Photo/Jacquelyn Martin