Sequestration

Sequestration is an enforcement device rather than a policy. When spending exceeds a statutory cap or a pay-as-you-go scorecard shows a net cost, the Office of Management and Budget calculates uniform percentage reductions and the cuts occur automatically. Its purpose is to be unattractive enough that Congress acts to avoid it.

Its defining characteristic is indiscriminacy. Because reductions are applied by formula rather than by judgement, effective and ineffective programmes within a category are cut at the same rate, and large categories are exempt by statute, which concentrates the burden on what remains. This is why it is criticised across the political spectrum while remaining on the books.

For a reader the useful question is always which scorecard is being discussed and whether Congress has waived it, which it frequently does in the same legislation that would otherwise trigger it. A sequester ordered is different from a sequester actually executed, and the gap between the two is where most of the reporting is. It interacts directly with appropriations and with the debt limit.