As everyone from federal, state, and local governments is keenly aware, significant federal budget reductions will occur over the next several years to reduce the federal debt. It is no longer a question of if or when, but rather how much these reductions will be. For the last two years, Congress has been struggling to agree on a plan that will reduce the debt and not impact mandatory spending (Social Security, Medicare) and not raise taxes which has proven, thus far, to be unachievable.
To resolve this impasse, Congress passed the Budget Control Act of 2011 which was intended to force an agreement on the necessary reductions, and in the event of failure, directed a mandatory, across-the-board reduction on all federal discretionary budget accounts. If Congress cannot reach an agreement by the statutory deadline, a sequestration must be applied to all federal budgets early in 2013. If applied, the mandatory sequestration cuts for defense would be $56.7 billion in fiscal year 2013, which is about half of the total cuts mandated for the entire federal government, and includes similar DoD cuts for the next nine years. These amounts would be in addition to the nearly $487 billion that are planned to be deducted from the DoD budget over the next ten years.
Please use the Resources section located at the National NDIA website for more resources.