How ‘Footloose’ helps explain the sequester

>>> stick with us because we get it. the fiscal cliff or the debt deal standoff and now called the sequester, it's a little boring. tedious. despite the sequester leading newscasts and filling front pages for weeks, a lot of you want to sit this one out. in fact, the pew research center and " usa today " did a survey and found that almost 30% of americans haven't even heard anything about it and only 27% admit to hearing a lot about the sequester. okay. i get it. but these self-inflicted automatic spending cuts are once again just around the corner, and are set to slash $85 billion over the seven months left in this fiscal year. that means millions of layoffs and furloughs for americans across the country and big cuts in spending on things like education and health care . we really can't sit this one out. it is too important. so this is our nerdland attempt to make the politics behind the sequester both understandable and if at all possible, fun. president obama is kevin bacon . in the cult classic "footloose." if you remember the film, you will recall kevin bacon 's character shakes up a small rural town when he moves to it with his mom and starts dancing. he's dared into a game of chicken , racing tractors with the town bully .

>> it's a tractor race. it goes on for awhile. so republicans in congress and the president agree to their game of chicken back in 2011 when they couldn't settle a fight over raising the country's debt limit. they avoided that game of chicken with the budget control act which had a bunch of crazy cuts that no one would want and as both parties would be forced to compromise but now their respective tractors are heading smack, more slowly, to one another again. if no one swerves off the road, bam, billions of dollars will be slashed from the federal budget and subsequently local budgets over the next ten years. so here's why president obama is kevin bacon . the president wants to act rationally and avoid the cuts all together, just like the city slicker character in "footloose" bacon doesn't even know what he's doing on a tractor and definitely doesn't want to crash into another one but neither of them can do anything about it because they are literally and proverbially tied down. remember the shoelace?

>> aahhh! president obama wants to get out of the way of the sequester cuts and see them replaced with a combination of increased tax revenue and spending cuts, but he is tied down to the congress by the shoelace. these automatic spending cuts are just six degrees of sequestration away from kevin bacon and the only difference is that all of us are hitched on to the back of the tractors with them. with me, carmen ulrich, peter goodman and lisa cook. okay.

>> kevin wins. hello. kevin wins.

>> that's why he's president obama .

>> we have a role when we write scripts. if we ever do a "batman" metaphor, the president is always batman. never robin.

>> it's called kick the can. that's the game that's probably -- that's the one that eventually intervenes and we end up back in the same spot.

>> you don't think they will come to a solution this time, they will just kick it further down the road?

>> i think they are both too dug in. they will figure some way to cancel the sequester because it is such an idiotic idea that the people that are paying attention understand we all suffer.

>> these policy decisions, even if they're not taken, have real consequences. a corporation in lancing, an auto supplier for the personnel carrier has laid off 90 people. already. announced this on monday. it has 300 employees. this is real stuff. they are not playing chicken with themselves. they are playing it with the economy. this economy is still healing. greatest tragedies and small businesses are the canary in the coal mine . they are the ones that start shedding workers. this gallup poll showed that small businesses are shedding workers more than they are hiring back workers. they are taking this into account. we cannot afford to have this manufactured crisis and a double dip or triple dip recession.

>> most of americans may not be watching but the ones that run the economy are.

>> this is the thing. you bring up a really good point. what i'm most concerned about here is that you cry wolf many times and the public and the business industry goes yawn, but that's not exactly what's happening. i equate it bring it back to the household equation. mom and dad are fighting, say dad's the gop and he says we've got to keep cutting the budget. there's no more meat on that chicken bone. mom is saying we need to make more money, we need to get another job, increase taxes, and they are both fighting. what does everyone else do, the people they are supposed to be taking care of? we hunker down, businesses start saying i'm not going to hire people, i will continue to sit on cash, i will continue cutting. consumers are going to say we're not going to spend, we're not going anywhere, not taking any risks. banks are not going to lend. there's an overall sentiment problem that when the people in charge are freaking out, everybody is going to be nervous because even though you don't necessarily feel it or see it or understand it, we know things are bad.

>> the president this week made exactly this point about why can't we get more revenue in this game. he was talking with reverend al sharpton on reverend sharpton's radio show . let's take a listen.

>> their basic view is that nothing is important enough to raise taxes on wealthy individuals or corporations, and they would prefer to see these kinds of cuts that could slow down our recovery over closing tax loopholes and that's the thing that binds their party together at this point.

>> yeah. absolutely.

>> the problem is that the republican brand is now tied up in this idea that government's the problem, taxation is the problem, we need to take this moment, we need to eliminate government services, we need to give the money back to the private sector. this old move that's been debunked by history many times over. but it's all they got. the alternative is well, okay, let's have something more balanced, let's come up with revenue, let's deal with economic inequality , and ideally actually stimulate the economy which is something we're not even discussing. the benefits of that, the republicans fear, would flow to the party that now controls the white house . so they're going back to the same move that by the way, did not play very well for them in the last election, but it's the only move they've got. we'll monkey wrench the economy, we'll pander to people who like tax cuts and then stick the white house with the blame when we go back into a recession.

>> you don't have to look at history. we just have to look over to europe. germany is the engine of growth in the eurozone. germa germany shrank by 0.6%.

>> they have a social safety net we can only dream of.

>> and they are the engine pulling that part of the eurozone and the part of the world economy . so all of these cards are going to start falling. we have to take everything seriously. that's why i'm saying this is not at all a laughing matter in the sense that we really are talking about jobs, talking about economic activity and talking about manufactured crises. we need to stop manufacturing crises. small businesses have to take this seriously. they employ over half the people in the economy and they are shedding workers.

>> the reason why the deficit is a crises for this party and for wealthy americans is because when the deficit gets too high, the value of investments goes down. how do they make money? by investing. so they're worried about their paychecks getting cut while the rest of america is literally going to have paychecks getting cut.

>> because these jobs disappear in part, whether we actually go over the fiscal cliff or around the fiscal cliff or bump into each other in this game of chicken , the politics itself becomes enough of a catastrophe to create this circumstance in the economy.

>> absolutely. this is what happened with the downgrade. remember a year and a half ago, we look back on the data and saw a big dip in economic activity . these are real costs. they're not just paper costs. they're not just financial costs. they are human costs. we are losing human time.

>> if you were running a business in virginia today, where there is an outsized dependence upon federal checks that will be cut if we hit the sequester and you're trying to figure out should i hire a few more people, whatever your business is, whether it's a bakery, dry cleaner, am i going to market my business. no. you will wait because you're nervous that serious spending power is about to be taken out of the economy.

>> because we know people aren't paying that much attention to the sequester, i want to remind them why virginia would be particularly hurt. because of how much defense spending gets cut. when we look at the cuts, we see the vulnerability of defense spending in particular which will have an enormous set of cuts and that of course, there's those who think good, cut the military, but that's actually growth potential.

>> these cuts are also willy-nilly. these are just cuts, period.

>> they hit schools, they hit social services .

>> breast cancer screening . senior nutrition.

>> what's really interesting is that now you see a lot of talk about the faa cuts. why? because what do, in terms of all these cuts, how do you make these cuts human for this class of people? you say your plane's going to be late. that's what you do. they are going to be caring about oh, my gosh, that means new york will be shut down after 11:00 , we can't get to where we need to go. that's a really serious problem.

>> we're going to take a quick break and come back on that. how do you make it human. tell them they are going to be inconvenienced. so great. how the sequester threatens the most vulnerable.