Showdown on US defence budget cuts

US defence spending will be hit
US defence spending will be hit

Looming budget cuts in the US, to be enforced at the beginning of January 2013, have divided Congress. Republicans fear the impact of those cuts, which will fall disproportionately on defence. They are also against tax increases. Democrats argue that tax increases would mean the defence budget could be maintained at a reduced level. The stalemate threatens to worsen America’s economy in the run-up to presidential elections in November

SINCE the failure of a bipartisan, bicameral Congressional committee to identify US$1.5 billion in federal spending cuts, in addition to reductions already announced, the debate in Washington over what to do next has intensified.


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