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Dayton: Action on sequester 'doesn't look at all promising'

WASHINGTON — Minnesota Gov. Mark Dayton said Monday he’s not optimistic lawmakers can avoid the deep federal spending cuts known as the “sequester” before Friday’s deadline.

Dayton heard from President Obama during National Governors Association meetings in Washington. The bipartisan group of governors all agreed the sequester must be dealt with in order to avoid harming the economy, Dayton said, but they run into the same problem as D.C. lawmakers: No one knows how to do it in a way that’s agreeable to both sides.

“As of today, [a deal] doesn’t look at all promising,” Dayton said. “But on the other hand, things happen usually at the very, very last minute in these situations, so I would say, between 10 p.m. and midnight on Thursday night, anything is possible.”

The White House released a list of affected state programs over the weekend and Dayton said he reviewed them Monday morning. Minnesota gets about 5 percent of its total revenue from federal spending subject to sequestration, one of the lowest figures in the nation. Dayton said that makes the spending cuts a little easier to absorb, though it will mean slower economic growth nationwide.

“The upside of being 49th among the states in federal money coming back is that we’ll be less impacted, but it’s all going to be negative,” he said.

Speaking to the governors at the White House, President Obama repeated his argument for repealing the sequester before it kicks in this week: Lawmakers should look to institute pro-growth policies and reduce the federal deficit by blending spending cuts and tax increases, rather than implementing broad across-the-board spending cuts like the sequester.

Republicans, meanwhile, seem split on how to deal with the sequester, although they’ve traditionally opposed tax cuts in any deficit reduction plan.

The spending cuts were included in a debt ceiling increase passed by Congress and signed by President Obama in 2011 as a way to spur lawmakers to act on the deficit. The cuts were originally scheduled to take effect on Jan. 1 but were delayed for two months.

Most lawmakers on both sides of the aisle want to do away with the sequester, but they can’t agree on a path forward. State and local lawmakers, including the governors meeting in Washington this weekend, have been especially vocal calling for some sort of a deal.

"We all are concerned," Dayton said. "It’s divided a little bit by political party, but even Republican governors want to get this resolved and are worried about the effect on their states."

Devin Henry can be reached at dhenry@minnpost.com.

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