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AIDS Issues Update Blog

Dispatches from the fight against homelessness and AIDS

Federal Deal Nothing More than a Delay: Sequestration Cuts Merely Postponed for Two Months

Posted by Sunny Bjerk , January 02, 2013

Federal Deal Nothing More than a Delay: Sequestration Cuts Merely Postponed for Two Months

Image from cbsnews.com

On December 31st at the eleventh hour, the President, House of Representatives, and the US Senators managed to strike a deal on the federal budget and thus narrowly, narrowly avoided sending the whole country over the now-infamous Fiscal Cliff.

In a fashion much more akin to “Days of Our Lives” than a thoughtful and robust political compromise, after a lot of backstabbing, two-timing, gossip, and two-faced hand-shaking, the 112th Congress passed legislation that, among other things, will block most tax increases while also raising taxes on the “wealthiest 2% of Americans.”*

And we should be happy that this deal was struck at the final hour, because it steers us far away from the automatic spending cuts that would slash over $538 million from domestic HIV/AIDS programs, right?

No. Not exactly.

While this last minute deal has been touted by many as a relief as we head into 2013, nestled within the legislation’s fine print is that the deal does not address the Sequestration cuts. In fact, all this deal actually does is merely delay these cuts for two months before these same cuts either kick in or new spending cuts are found.

In many ways, then, this deal is nothing much more than a delay. Within two months time, people living with HIV/AIDS and AIDS advocates may still be facing over $500 million in domestic HIV/AIDS spending.

While these proposed Sequestration cuts may change in the next two months, many are predicting these cuts will take place as planned.

Until then, we will continue to watch as this deal and its deepest details are unpacked and explained.

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*In particular, individuals who make $400,000 per year and married couples (which still will NOT include same-sex couples, thanks to the dismal and continued stupidity of DOMA) who make $450,000 per year will see an income tax rate increase from 35 percent to 39.6 percent. In addition, households with an income between $500K and $1 million will see an average tax increase of $14,812, and households making more than $1 million will see an average tax increase of $170,341.

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