Budget chaos hits MIT
By Dave Watt
MIT may issue hundreds of layoff notices to employees if negotiators in Washington fail to agree on the new federal budget before the Oct. 1 Gramm-Rudman-Hollings deadline. Without a budget settlement, MIT research programs face "chaos," said Kenneth A. Smith '58, associate provost and vice president for research.
Negotiators in the White House and Congress have failed to reach an agreement on reducing the deficit, which will run $149.4 billion next year, according to an Aug. 20 Office of Management and Budget estimate. This is well above the 1990-91 GRH deficit target of $64 billion.
Without an agreement for reducing the deficit, $85.4 billion in mandatory cuts in social programs and defense spending will result, a process known as sequestration.
Non-defense programs face sequestration of 32.4 percent of their budgets, according to OMB. Defense-related programs, excluding military personnel accounts, face cuts of 35.3 percent. Many programs, including Social Security, are exempt from these cuts, but contract research budgets are not.
The sequestration lasts only until an agreement is reached on reducing the federal budget deficit. For each month without an agreement, a fraction of the cuts take effect. In the past, budget negotiators have been able to settle their differences within a month or so after the November elections.
On campus, MIT receives approximately $250 million per year in grants from various agencies of the federal government for conducting sponsored research, out of a total operating budget of approximately $1 billion. Many different government agencies, including the National Aeronautics and Space Administration, the Departments of Energy and Defense, and the National Institutes of Health, provide grants to MIT laboratories to fund their research.
MIT's sponsored research programs could face cuts as large as $80 million, Smith said. "It would decimate [research here]," he said. "That's why everyone believes [the sequester] will be short-lived. It's an exercise in madness," he added.
The National Science Foundation plans to cut funding for continuing research grants by 50 percent, according to a memorandum signed by former NSF director Erich Bloch, who left office at the end of last month. New grants will continue to be awarded, but "delays are likely," his Aug. 29 memo warned.
The Francis Bitter National Magnet Laboratory, whose appeal of a lost NSF contract made national headlines, now faces even steeper cuts in its funding due to the NSF announcement.
Other agencies have made no announcements on plans to implement cuts, leaving some laboratory directors baffled about what to expect.
Ronald R. Parker '63, director of the Plasma Fusion Center, said he has only been warned by DOE contract monitors, "Don't make commitments based on the president's budget." The PFC receives over $20 million from DOE, comprising over 90 percent of its funding.
According to Parker, DOE plans to furlough its workers one day every two weeks, without pay, to cut salaries by 10 percent. He was hopeful that MIT would consent to furloughs instead of layoffs, but Smith said furloughs are impossible under current MIT personnel rules.
Smith criticized all parties in Washington involved in the budget process. "It's obviously a conscious game of chicken. We don't have the discipline to make ourselves do what we have to do in a rational fashion."
"If we said that we will rely upon the Congress to embark on a sensible program of deficit reduction without this mindless gimmick, it wouldn't happen!" Smith said.