ANCHORAGE — Federal budget cuts are on the way and programs dear to Alaskans, such as highway and defense construction and rural health care, may not be spared over the next decade, according to U.S. Sen. Lisa Murkowski.
The country is drowning in debt, the Republican senator said Tuesday in a speech to Commonwealth North that was billed as a preview of the Capitol Hill agenda over the next four months.
“The spending levels are not sustainable,” she said. “Our country is drowning in debt. What we’ve then placed on children and grandchildren is simply not acceptable.”
How aggressively the nation’s leaders deal with the situation is going to shape the direction and the strength of the country, she said.
The Budget Control Act of 2011 plan approved last month does not get the budget under control, she said. It requires a reduction in spending of $917 billion. It requires Congress to vote on a balanced budget amendment to the U.S. Constitution between Oct. 1 and Dec. 31.
And in a move that should generate headlines for the next eight weeks, it also establishes a 12-member bipartisan congressional committee to recommend by Thanksgiving ways to reduce the federal deficit by $1.5 trillion from 2012 to 2021.
Murkowski said she doesn’t care for that mechanism and the 12 members will have a tough job. Some have stated they do not want entitlement reform and some have said they do not want revenue increases. Every move the committee makes will be under a microscope and criticized by a constituency, she said.
However, if the committee is not successful, and if Congress fails to approve a plan for at least $1.2 trillion in savings over the 10 years, an enforcement mechanism called sequestration kicks in: automatic spending cuts with 50 percent from defense and 50 percent from “non-defense,” and decisions made by departments.
The committee will be able to build on previous work, including ideas floated earlier this year by a bipartisan group of senators, the “Gang of Six.”
Tax reform is likely to be on the table. Just raising taxes is not the answer, particularly at a time when the nation is struggling with a recession, Murkowski said, but she pronounced herself willing to look at the idea floated by billionaire Warren Buffett to “stop coddling” the mega-rich.
“I’m one of those that is willing to consider whether that proposition might have some merit as part of a comprehensive overhaul of the U.S. Tax Code,” Murkowski said. “I may be one of the few that says that publically.”
But what could Alaskans sacrifice with budget reduction?
That’s not defined, she said after the luncheon, but the state sees significant defense construction dollars, and if there are reductions, they will be felt here.
Likewise, dollars are in place for Indian Health Service construction projects such as hospitals in Barrow and Nome, but staffing that will be needed could be in jeopardy.
The formula for federal highway program has given Alaska more per capita than any other state, for a host of reasons built into the formula. Everything is likely to be scrutinized.
“The real question is, are there areas where we say, ‘This is a haircut that we just have to take?’ It’s going to be very hard.”
She urged people not to key in to one aspect of a budget reduction plan but to be open-minded and see what comes together as a whole.
“If we all start by saying, ‘It’s never going to work,’ it’s probably never going to work,” she said.