With the March 1 budget sequestration looming and predictions of general chaos in the delivery of federal government services, the North American Millers' Association (NAMA) has prepared a briefing paper for members on the possible affects on the milling industry. The paper is available in the Members Only section of the website at http://www.namamillers.org/membership/membership-portal/.
As has been widely reported, the budget sequester is an across the board $85 billion cut in the current year’s federal government budget, roughly divided half to the military and half to non-military spending. It was a last-ditch effort amid budgeting gridlock and designed to be so onerous to both parties that they would have incentive to negotiate a more permanent budget solution. Without progress toward more normal budgeting and both parties digging in on who will be blamed for the potential chaotic situation, it now seems very likely that the government will begin implementing the cuts on March 1.
Since the cuts amount to about a 6 percent reduction in the annual budget, to be implemented in the last half of the year, the impact on the remaining months of the fiscal year is expected to be about twice that percentage. The Obama administration says it will do little to prioritize how the cuts will be spread around, but that posture is likely intended to generate public pressure on Congress to take action to avoid the sequester.