After passing through the Senate, the House today approved a $1 trillion continuing resolution to fund the government through the rest of the fiscal year ending on October 1. Passage of the bill prevents a government shutdown on March 27.
The total price of averting a government shutdown amounts to about $85 million in budget cuts at various government agencies over the next six months. The sequestering of these funds became a reality on March 1.
This was because Democrats and Republicans couldn't agree on a compromise for funding the second half of the fiscal year that began on October 1, 2012. The passage of the continuing resolution was their last chance to avert the sequester. Some say it ended up being too little too late.
The continuing resolution details the Defense Department and some other agencies cutting specific programs, rather than making cuts across the board. Detailed spending plans for the Departments of Agriculture, Commerce, Homeland Security, Justice and Veterans Affairs are also outlined.
Almost 1 million furloughs are expected to be a reality, with the exception of food inspectors, due to a last-minute deal. According to the Washington Post, letters will be sent out to government workers and private-sector workers paid with government funds.
This also includes nearly 800,000 civilian employees working for the Defense Department. Additionally, some employees will be forced to take off 22 days, without pay until October. This amounts to an almost 20 percent pay cut. Of course, pay raises for federal employees have been put on hold.
The Huffington Post earlier this week detailed layoffs at employers from Washington State to Pennsylvania who will not be getting government funds. While the number of jobs that will be affected is debatable, the Congressional Budget Office is estimating as many as 750,000 jobs will be cut by the end of 2013 because of the sequester.
Private analysts, on the other hand, are putting the figures closer to 300,000, adding that consumer spending will be taking a hit because of reduced spending by furloughed workers.