Budget gridlock could cost Washington state 41,000 jobs, $3 billion

WASHINGTON - Federal spending cuts planned for March 1 could hit Washington state hard, costing 41,700 jobs and removing $3.4 billion from its economy, according to state estimates.

And that possibility has members of the state's congressional delegation fretting big-time on Capitol Hill.

Unless Congress reverses them, big cuts are in store for the military, schools, law enforcement, health care, food and workplace safety programs, nutritional assistance for the elderly, programs that help the homeless and small businesses and Indian tribes, and many more.

Freshman Democratic Rep. Denny Heck of Olympia said that up to 10,000 civilian employees at Joint Base Lewis-McChord could be forced to take 22 furlough days before Oct. 1.

And with his district heavily dependent on federal money, he fears the unemployment rate could rise by 1 to 2 percentage points.

"This is real - this could tip South Puget Sound into a recession," Heck said in an interview, adding that Congress' "self-imposed problems are about to hit us like a ton of bricks."

Nearly seven weeks into their first term, Heck and another newcomer, Democratic Rep. Derek Kilmer of Gig Harbor, are getting a good taste of how Congress jumps from crisis to crisis in trying to manage its money woes.

And both are upset that Congress is on recess for all of this week instead of staying put to pass a plan to avoid the spending cuts that now are only nine days away.

"There seems to be a desire to point fingers and play games rather than actually solve this, and that has real implications. I heard someone say, 'This is no longer the fiscal cliff, we've developed the fiscal mountain range,' " Kilmer said in an interview.

The sense of urgency among some members of Congress is not shared by those in charge in Washington, D.C. House and Senate leaders decided there was no need to call off the long-planned Presidents Day break, and President Barack Obama headed to Florida last weekend to golf with Tiger Woods.

If the cuts go through, one of the biggest casualties could be Washington state government, with federal spending accounting for anywhere from 20 to 25 percent of the state's budget in the past dozen years, according to the state's Office of Financial Management.

State lawmakers were briefed on the pending cuts last week. Washington could receive $118 million less in federal grants for the remainder of the fiscal year, according to state estimates.

State officials say it's impossible to estimate the exact economic impact until the cuts are implemented. But they said the cuts could range from 5 to 12 percent for most programs. That could mean millions less for special education and high-need schools, community social services, vocational rehabilitation, alcohol and substance abuse, foster care, early-learning programs, transportation, weatherization, and wastewater and drinking water programs, among others.

Washington state receives roughly 2 percent of all U.S. military spending, with military personnel accounting for about 1 percent of the state's population.

The $85 billion in across-the-board cuts for the current fiscal year are part of a process known as sequestration. Congress put the process in place as an incentive for its so-called super committee to come up with a plan to trim the federal deficit, but members of the panel - co-chaired by Democratic Sen. Patty Murray of Washington state - could not reach an agreement. That set the stage for the automatic cuts.

"This was never supposed to happen," Heck said. "This was the sword over the heads of the super committee that was so unthinkable it would compel them to reach a solution. Well, here we are."

Many members of Congress who now worry about the impact of the cuts voted for sequestration in 2011 and in January joined the president in backing a plan to delay the cuts until next week. And while the cuts are controversial, backers say they could be good in the long run, allowing a gridlocked Congress to take some action to rein in its spending.

With the clock ticking down, Republicans and Democrats blamed each other for the stalemate before leaving the Capitol last week.

Republican Rep. Cathy McMorris Rodgers, the chairwoman of the House Republican Conference, said the House has twice voted to approve bills that would replace the cuts. But she said Obama had "failed to bring forward a serious replacement" and had shown in his State of the Union speech that he was "out of touch" with a majority of Americans by not proposing a credible plan.

"If the president does not get serious soon, his inaction will trigger dangerous, across-the-board cuts on March 1 that will hurt hardworking taxpayers across the country," she said.

On Thursday, Murray and other Senate Democrats proposed a $110 billion plan to replace the cuts, a proposal that included new taxes and different spending reductions spread out over 10 years, drawing a quick endorsement from the White House. They hope to vote on it when they return to Washington next week.

Officials say the cuts would have a spillover effect, leading to less spending everywhere.

At the first hearing of the Senate Budget Committee since Murray was chosen to head the panel in January, Murray said last week that the sequester and other "fiscal tightening" could depress economic growth by about one and a half percentage points, leading to a loss of roughly 2 million jobs this year.

Democratic Rep. Rick Larsen said Republicans and Democrats in Congress need to unite to pass "a big and bold plan" to slash the federal deficit and preserve "vital job-creating investments" at the same time.

"The political games of sequesters and fiscal cliffs wreak havoc on the economy, and the middle class suffers the consequences," he said.