February 28, 2013 at 14:04 PM EST
NY learns to stop worrying about sequester
On Sunday night, the White House put out a state-by-state breakdown of what $85 billion of sequester cuts would mean for every region of the country. New York State stands to lose more than $275 million in federal aid through the end of the federal fiscal year Sept. 30. But local leaders and economic experts are hardly picking up the doom-and-gloom drum beat. "On Monday, we'll be able to police the streets," Mayor Michael Bloomberg told reporters earlier this week when asked about the local impact of potential sequester cuts that would go into affect March 1. "There will be a fire engine that responds and an ambulance. Our teachers will be in front of the classroom. If there's snow, we'll be able to plow…. When you have employees—you can't just overnight reassign them or eliminate them. There's a lot of things that take a long time." The city is expected to get $8.8 billion from the federal government this year, according to the Independent Budget Office. That number could be inflated by about $1.4 billion in FEMA funds and some federal dollars the city receives for capital projects. But the city's budget this year is $68.9 billion. The flip side of not receiving a lot of federal aid is that the across-the-board cuts won't break the city's back. "A lot of [the city's federal funds] are protected, so there's a lot of posturing… 'We're going to take all the prisoners from jails and put them on the streets.' Spare me," Mr. Bloomberg said. Sequestration could result in $1 trillion in federal cuts nationally through 2021. The Congressional Budget Office estimated that sequestration could cost the U.S. economy about 750,000 jobs by the end of the year, but the loss will not be spread evenly. For example, more than half of the federal reduction is in defense cuts—not a huge New York industry. In December, there were 3.88 million public and private sector jobs in New York City. A conservative estimate of job loss, according to James Parrot, chief economist of the left-leaning Fiscal Policy Institute, would be about 15,700 by the end of 2013. That number isn't nothing: it still accounts for about 30% of the projected job growth forecast for this year. "None of these impacts is trivial and would further slow the pace of NYC's recovery and operate to keep unemployment unusually high," Mr. Parrott said. The slate of sequester cuts could have a larger effect on the unemployed because unemployment insurance benefits for the remaining ten months of 2013 will drop $105 million, according to Mr. Parrot. "Unemployment insurance benefits have a very high local spending multiplier," he said. "Every dollar lost in unemployment insurance to the NYC economy could result in up to $2 in lost spending." Tax policy expert E.J. McMahon of the conservative Manhattan Institute told the negative nabobs to cool it: $275 million is less than half of Gov. Andrew Cuomo's proposed 2013-14 increase in school aid, or .093% of total spending by state and local governments. "Summary: get a grip!" he said in an email. Here's a list of some of the federal cuts this year: $42.7 million in primary and secondary education funding job losses for 440 teachers and staff who work with disabled children as well as 590 regular teachers and teacher aides cuts to Head Start program for 4,300 children lost college financial aid for 4,520 low income students $1.5 million for meals for seniors about $12.9 million in environmental funding and $1.2 million in grants to protection fish and wildlife about 12,000 civilian Defense Department jobs would be furloughed
Stock Market XML and JSON Data API provided by FinancialContent Services, Inc.
Nasdaq quotes delayed at least 15 minutes, all others at least 20 minutes.
Markets are closed on certain holidays. Stock Market Holiday List
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.
Press Release Service provided by PRConnect.
Stock quotes supplied by Six Financial
Postage Rates Bots go here