March 4th, 2013, by Abby Benson  

Week in Review, or Settled on the Sequester

After months of declarations from both parties about how sequestration is just plain bad policy that could be devastating to the economy, the White House and Congress were unable to be broker a deal to avoid the automatic, across-the-board cuts to federal discretionary spending. On Thursday, one day before the March 1st deadline, the Senate failed to pass two sequester alternative bills, one put forth by Democrats and the other by Republicans. On Friday morning, the President met with Congressional leaders for an hour at the White House, in a perfunctory meeting where they focused more on the next fiscal deadlineMarch 27th, when the current stop-gap continuing resolution funding the government is set to expirethan they did on finding a deal to avert sequestration. As a result, just before midnight on Friday, the White House Office of Management and Budget (OMB) officially ordered sequestration to take place, delivering an 83-page report to Congress outlining details of the roughly 5% cut to non-defense discretionary programs and 7.8% cut to defense discretionary programs.

While much of the posturing around sequestration included scary predictions of impacts on America’s teachers, military, and businesses, both parties brought the rhetoric down a few levels last week, essentially agreeing that while sequestration would cause pain, it would take a while for its full impacts to be felt. In that Friday meeting at the White House, both parties emerged with an apparent agreement not to use the March 27th date as the next manufactured political crisis but instead to pass a bill funding the government through FY 2013, taking the sequestration cuts into account. Many thought that the March 27th date would provide both the White House and Congress some leverage to demand a sequestration alternative or risk a government shutdown before any of the real effects of sequestration were felt, but with that off the table, common wisdom appears to be that sequestration will continue until the end of the fiscal year.

Despite this sense of resignation, President Obama appears to be hoping that once the American public starts feeling the pain of sequestration, that they will demand that it be stopped. In his weekly address to the American people on Saturday, the President stated that sequestration cuts could cost the country 750,000 jobs and slow the economic growth by over 0.5 %, and that “Congress can turn them off anytime, as soon as both sides are willing to compromise.” Speaker of the House John Boehner (R-OH) continues to state emphatically, however, that Republicans already gave when they agreed to raise taxes as part of the New Year’s fiscal cliff deal, and that raising taxes will not be part of any sequester replacement package. Meanwhile, Senator Susan Collins (R-ME) and Mark Udall (D-CO) are working on legislation that would keep the magnitude of sequestration cuts in place, but provide the White House with some flexibility, subject to Congressional oversight, over how sequestration will be implemented.

So what will sequestration really mean to federally funded R&D? As with most federal policies, the devil will be in the details. Although the cuts are supposed to affect every program equally, it is not entirely clear yet how agencies will implement them. I’ve listed below just a few examples of what agencies have said they will do to implement sequestration, but principal investigators around the country will need to wait for more detailed guidance from the agencies that support them.

  • The NIH released a sequestration operating plan, indicating that in FY 2013, non-competing continuing awards will likely be funded at lower levels that originally agreed to. The plan also indicates that each institute within NIH may choose different strategies for applying the cuts.
  • In a message to university presidents and chancellors, the NSF Director announced that the agency plans to protect existing research awards, but expects to make nearly 1,000 fewer new awards under sequestration.
  • The NASA Administrator has indicated that they do not anticipate furloughs, but that sequestration cuts will reduce research grants by about 5% and will also slow space exploration and other plans.

Looking forward, House appropriators have been busy preparing a FY 2013 appropriations bill to fund the rest of the year beyond March 27th, which could be introduced as early next week. This bill will likely adhere to the $1.043 trillion top line number agreed to in the Budget Control Act of 2011, minus the sequestration cuts. The bill is expected to continue the current CR funding for most agencies, while providing additional spending flexibility for the Departments of Defense (DoD) and Veterans Affairs (VA). The Senate is also working on a FY 2013 appropriations bill, which CQ reports may include spending flexibility for agencies beyond the DoD and VA.

Moving on to FY 2104, it is still unclear when then the President will deliver his budget request to Congress. This isn’t stopping the House Appropriations Committee from moving forward with their regular schedule of hearings to review spending for programs under their jurisdiction. In the meantime, both parties are holding out hope for something looking more closely like “regular order” for the FY 2014 budget/appropriations process.

Also of Note

Appointments. After a grueling nomination process, the Senate confirmed President Obama’s nominee for Secretary of Defense, former Senator Chuck Hagel. The Senate also approved the nomination of Jack Lew to be the next Secretary of the Treasury. Both men were sworn into their new positions this week.

Politico reports that the President is expected today to nominate Ernie Moniz, Director of MIT’s Energy Initiative, to be the next Secretary of Energy and Gina McCarthy, head of the Environmental Protection Agency’s (EPA) Air Office to be the next EPA Administrator.

Energy. Science reports on a new study issued by the Department of Energy (DOE) Basic Energy Sciences Advisory Committee rating 12 of its user facilities. This report came in response to a request from the head of DOE’s Office of Science for advisory committees to help prioritize the department’s user facilities in order, by September 2013, to formulate a “10-year prioritization of scientific facilities across the Office of Science based on (1) the ability of the facility to contribute to world-leading science, and (2) the readiness of the facility for construction, and (3) an estimated construction and operations cost of the facility.”

The official DOE blog offers some of the highlights of the third annual ARPA-E Innovation Summit, a highly regarded gathering of energy luminaries from around the country. Keynote speakers at this year’s conference included New York City Mayor Michael Bloomberg, former Governor Mitch Daniels, entrepreneur T. Boone Pickens, Tesla Motors CEO Elon Musk, and Energy Secretary Steven Chu.

Patent. Reps Peter DeFazio (D-OR.) and Jason Chaffetz (R-UT) introduced the Saving High-tech Innovators from Egregious Legal Disputes (SHIELD) Act (H.R. 845).  The bill aims to “protect American innovators and companies from frivolous patent lawsuits that cost jobs and resources. The SHIELD Act will put the financial burden on so-called “patent trolls” that buy broad patents on products they did not create and then file questionable lawsuits against companies for infringement.

Space. SpacePolicyOnline reports that House Appropriations Commerce, Justice, Science subcommittee Chair, Frank Wolf (R-VA), has written NASA asking for more information on their use of Space Act Agreements (SAAs), which allows NASA to engage with outside partners outside of the confines of the more stringent Federal Acquisitions Regulations. According to NASA, the agency uses Space Act Agreements, “Space Act Agreements enable us to enter into partnerships with organizations that give us access to a wider range of technologies and capabilities that are not part of NASA’s core competency.”  The NASA Inspector General office also intends to conduct an audit of NASA’s use of SAAs.

Rep. John Culberson (R-TX) and Frank Wolf (R-TX), have re-introduced the Space Leadership Preservation Act (H.R. 823). First introduced last year, this bill would lengthen the term of the NASA Administrator and make structural changes to the agency’s budgeting. The co-sponsors of the bill participated in a hearing on the bill before the House Science, Space, and Technology Committee. You can read SpacePolicyOnline’s analysis of the hearing here and the bill here.

In Print

MIT President Rafael Reif and Craig Barrett, former CEO of Intel, write in a Financial Times op-ed (subscription required) ahout how Science must be spared Washington’s axe. The authors argue that allowing sequestration to happen “would be a big mistake. It would further weaken the most powerful stimulant of economic growth ever devised.”

Peter McPherson, president of the Association of Public and Land Grant Universities (APLU), writes in Roll Call that “I’m deeply concerned that massive cuts to our education and innovation capacities, which are critical to both economic growth and deficit reduction, would have severe, long-term effects that would put our nation at an extreme disadvantage for decades to come.”

In written testimony before the Senate Budget Committee hearing on the The Impact of Federal Investments on People, Communities, and Long-Term Economic Growth, Hunter Rawlings, President of the Association of American Universities (AAU), writes about sequestration that “Cutting these investments in our future is not the way to solve our nation’s deficit problem. Such cuts would undermine economic growth that is essential to deficit reduction. Yet that is exactly what the sequester will do. To put it kindly, this is an irrational approach to deficit reduction. To put it not so kindly, it is just plain stupid.”

The Washington Post reports on a call with reporters during which NIH Director Francis Collins outlined the expected impacts of sequestration’s $1.6 billion cut to the NIH.

An article in the The Economist entitled Bad Medicine discusses the impact of the sequester, and America’s “fading” pre-eminence in research.

Brad Plumber writes in The Washington Post about The coming R&D crash, and the impact sequestration would have on federal R&D spending and the U.S. economy.

The Computing Research Association posted a summary of a recent Congressional hearing on limitations of government travel in the wake of the GSA conference scandal, and the impact the limitation are having on the scientific enterprise. Joe Davidson writes about the same issue in his Federal Diary Piece entitled Unintended consequences of limits on government travel

National Public Radio’s Science Friday reports on Mapping the Effects of the Sequester on Science with special guest Mike Lubell, Professor of Physics at the City College of the City University of New York and Director of Public Affairs, American Physical Society.

Research!America released a new poll showing “more than two-thirds (67%) of small business leaders say basic research funded by the federal government is important to private sector innovation.”

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