What Is Sequestration?

Over the next seven months, dramatic cuts to the federal budget will go into effect.

Sequestration, sometimes called the sequester, is a process that automatically cuts the federal budget across most departments and agencies.

Congress included the threat of sequestration in the Budget Control Act of 2011 as a way to encourage compromise on deficit reduction efforts.

Congress couldn’t agree on a budget by the deadline set in the Budget Control Act, so mandatory budget cuts were scheduled to go into effect on January 2, 2013.

Congress stopped the cuts from happening by passing the American Taxpayer Relief Act on January 2. This law pushed the budget cuts back until March 1, 2013.

If Congress cannot agree on a budget to reduce the deficit by March 1, then sequestration would happen and $85 billion in spending cuts would go into effect.

These reports give detailed information about the amount that programs may be cut and which programs are exempt from sequestration:

• White House Office of Management and Budget Sequestration Reports to the President and Congress
• Congressional Budget Office Report on Estimated Impact of Automatic Budget Enforcement Procedures Specified in the Budget Control Act
• Congressional Research Service Report on Budget “’Sequestration’ and Selected Program Exemptions and Special Rules” (PDF)