CHARLES TOWN – Sen. Joe Manchin has harshly criticized congressional inaction and $85 billion in spending cuts that are expected to go into effect next month, saying that they would “take an axe to West Virginia.”
“It is discouraging and shameful that Congress cannot work in a bipartisan manner to come together and reach a long-term compromise to get our fiscal house in order and stop these reckless spending cuts from going into effect,” Manchin said in a statement released Tuesday.
The cuts, referred to as “sequestration,” were put into law as part of an agreement to raise the debt ceiling in 2011, with the stated intention that they would be a punishment for lawmakers if they were unable to reach a debt-reduction deal.
Economists are somewhat divided on the impact of sequestration on the national economy, but most forecasts indicate it will reduce economic growth by between 0.5 and 1.0 percentage points. This would be a significant reduction over the current annual growth rate, which was calculated to be around 2.2 percent for 2012. Most economists think that the growth rate needs to be around 3.0 percent to significantly reduce the unemployment rate.
A small group of economists, however, do not think the sequester will have any impact on economic growth because, they argue, government spending “crowds out” private investment.
Some commentators have noted that the effect on a state-by-state basis varies widely, largely based on the impact that defense spending – from which half of the total cuts will come – has on state economies such as Maryland and Virginia, where a significant portion of the population works either for the federal government or for defense contractors.
The impact on West Virginia, and Jefferson County in particular, remains less clear.
Manchin has released his projections of the impact of the cuts on West Virginia in particular. His numbers are based on reports from the White House, the Senate Appropriations Committee, and several federal agencies that are expecting budget cuts as a part of the sequester.
According to his report, he expects around 2,000 civilian employees of the Department of Defense from West Virginia to be furloughed, removing a total of $9.9 million in wages. About $30 million is expected to be cut from the National Guard’s budget, with 56 Guardsmen to be immediately furloughed and another 900 being furloughed for 22 days at the close of the fiscal year.
Defense cuts are likely to hit the Eastern Panhandle’s economy more than the rest of the state, due to its proximity to defense industry hubs in Northern Virginia and Washington, D.C., but it is difficult to determine their exact impact.
Air traffic controllers would be furloughed for night shifts at all West Virginia airports, and it is expected that operations would be completely suspended at five of the airports, according to the report. It adds that employees at 26 food safety inspection sites around the state could potentially be furloughed as well, which the USDA and FEMA warn could raise the risk of outbreaks of food-borne illness.
About $2.98 million is expected to be cut from Head Start programs, eliminating the service for 415 three- to four-year-olds and potentially causing layoffs of up to 180 teaching positions, according to the report. Another $3.88 million is expected to be cut from special education funding, and $5.8 million is expected to be cut from Title I grants for low income students.
Around $197,000 in grants for police and firefighters would be eliminated, according to the report, along with another $177,000 in grants for public health and $430,000 in grants for substance abuse programs. The report adds that several hundred children would not receive free immunizations due to cuts to the Centers for Disease Control, and that $160,000 would be cut from senior nutrition assistance programs like Meals on Wheels. The CDC cuts would also mean 600 fewer free breast cancer screenings.
Another $247,000 would be cut from job search programs, along with another $50,000 for a veterans’ job search program.