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Top U.S. government VARs and integrators are less concerned about President Obama's re-election and its effect on federal IT priorities than they are anxious for the federal government to avoid sequestration, which in recent months has become a major source of anxiety in the channel.
Generally speaking, sequestration, more commonly called the "fiscal cliff," refers to the 2011 Budget Control Act, which will take effect on Jan. 2, 2013, unless a deal is reached to undo it before then. In a nutshell, the legislation calls for $1.2 trillion in federal cuts over a 10-year period, including some $500 billion in defense spending.
Some observers see sequestration, along with other upcoming fiscal changes such as the expiration of Bush-era tax cuts on Dec. 31, as contributing to a so-called "fiscal cliff" that will disrupt the economy over the next few years. It remains a source of contention in a sharply divided Congress, and it is also hated by officials concerned about the indiscriminate nature of the cuts and how much they take away from certain defense and domestic programs. Top defense officials have described the effect of the potential cuts, for example, as a "hollowing out" of the military, and most observers -- including from defense, healthcare and other industries -- fear catastrophic job losses as a result of those cuts.
[Related: Obama Wins, VARs Fear Job Cuts]
President Obama said during the third presidential debate in October than sequestration wouldn't happen, but the Obama Administration has also been criticized for not putting forth proposals to stop it.
According to federal-focused partners interviewed by CRN Wednesday at the Symantec Government Symposium in Washington, D.C., fiscal cliffs are far more concerning than specific Obama Administration IT priorities.
"Sequestration has been hanging over our heads for months," said Carmine Taglialatela, vice president of business development for TecPort Solutions, a Delaplane, Va.-based solution provider and also a federal IT channel consultant. "With the Congress and the Senate in the same state now as they were a few days ago, what's going to happen? We're at loggerheads, and we're not getting decisions on pretty much anything yet. I honestly don't believe sequestration will take place. It would be detrimental to the United States, so I'm hoping saner minds will prevail."
"Sequestration is not a good thing," said Barbie Bigelow, senior vice president and chief information officer at TASC, a Chantilly, Va.-based solution provider. "It's arbitrary and it doesn't allow the government to really focus on the mission and priorities for businesses. That is the most important thing: for us to get around that, or through that, to a path where we are looking at the right things and leveraging technology to enable that."
"I think the scary thing is that many of these elected officials have not been in business and don't have business heads to understand the impact sequestration would have," said the top executive at a well-known federal integrator, who asked to remain anonymous. "If you don't have some assurance where cuts will be made and what the effects on tax credits will be, you as a businessperson won't invest over a long period and you won't hire. This is not good."