A report out today from the Democrats on the House Appropriations Committee shows costly new flaws in Congress’ approach to fiscal policy. Beyond providing updated information on the anticipated impacts to specific programs from the across-the-board spending cuts known as sequestration, the report shows Congress’s piecemeal approach to “fixing” sequestration is more than just unfair – it’s costing the U.S. more money.

Since the threat of sequestration failed to spark a spending compromise and the haphazard slashing began, lawmakers have faced uneven amounts of pressure to replace chunks of sequestration cuts from varying groups. The success of that pressure seems to hinge on the political influence wielded by the group affected by a given cut. Unemployment beneficiaries, Head Start students and parents, 140,000 families on housing assistance, and seniors who rely on Meals on Wheels, among many other politically marginalized groups, have received no relief from sequestration.

Business travelers, on the other hand, have seen their outcry over airport delays due to sequestration yield a “fix” for the Federal Aviation Administration.

Today’s report goes beyond that unfairness to explain how the piecemeal “fix” to avert flight delays is actually raising the economic costs of aviation delays, by tens of billions of dollars:

The [Reducing Flight Delays] Act [of 2013] allowed the FAA to apply sequestration to the Airport Improvement Program (AIP), which had been exempt in the original sequestration order. […]

Cutting the AIP program slows FAA’s ability to meet construction needs. FAA estimates that development needs at eligible airports will exceed $42.5 billion over the next five years. The American Society of Civil Engineers 2013 “Report Card for America’s Infrastructure” rated our aviation system a “D,” estimating that the cost of congestion and delays to the economy will rise to $34 billion in 2020 (up from $22 billion in 2012), and that “D” grade assumes we continue to spend at current funding levels — before sequestration.

Even before Congress gave the FAA permission to halt all airport construction funding, America faced a $12 billion increase in the economic drag caused by aviation congestion. Now that cost is going to swell.

These can-kicking costs come on top of the more immediate damage sequestration will do to the economy: 700,000 fewer jobs and a 0.6 percentage-point reduction in GDP growth for the year. The Huffington Post reported several of the mechanical details of individual agency responses to the cuts contained in today’s House report, including 500 fewer firefighters at the Forest Service and a shrunken stockpile of vaccines at the Centers for Disease Control and Prevention.

Two weeks after announcing a record high unemployment rate, Europe’s official economic analysts today revealed another first for the currency union: The Eurozone’s ongoing recession is now the longest in the 14-year history of the euro. The Guardian notes the European economy has now shrunk a full percentage point over the past year:

The eurozone has slumped into its longest recession ever, after economic activity across the region fell for the sixth quarter in a row. […]

France, Spain, Italy and the Netherlands all saw their economies shrink as the economic crisis in the eurozone continued to hit its largest economies.

Eurostat’s figures showed that the eurozone economy has now contracted by 1% over the last year, putting further pressure on leaders as unemployment climbs to new record highs.

The 0.2% contraction in the first quarter of 2012 was an improvement on the 0.6% drop recorded between October and December, but analysts warned that the eurozone’s economic outlook is darkening.

This is the second ugly bit of record-setting in two weeks, after the Eurozone’s unemployment rate hit 12.1 percent at the end of April. It was the 23rd consecutive month of record-breaking unemployment, with 26.5 million people out of work.

These records seem to have created some space for European policymakers to begin at least discussing an end to austerity. For example, French finance minister Pierre Moscovici reacted to the news that France’s economy had contracted for the second straight quarter by calling for pro-growth policies to return across the Eurozone.

So far, however, the damagingly aggressive reduction in deficits is projected to continue in Europe. And American deficits are now projected to dip even more dramatically than those in Euro countries.

The drop in aggregate Eurozone deficits looks alarmingly similar to the rapid decline in U.S. deficits CBO now projects for 2013. According to European Commission projections for 2013, the countries that use the euro will have cut their combined deficits to 2.9 percent of GDP by the end of the fiscal year, down from 6.4 in 2009. The new CBO figures predict U.S. deficits are shrinking even more dramatically, to 4 percent this fiscal year from over 10 percent in 2009.

In other words, as Europe’s deficit-slashing fever produces a record contraction, American policymakers are learning they’ve outdone their Old World colleagues. But where Europe’s outright contraction may be forcing a policy reversal, slow but steady economic growth in the U.S. seems to be obscuring the lessons from bad headlines across the Atlantic.

The budget deficit will shrink to its smallest level since before the Great Recession in 2013, and it will continue shrinking through 2015, according to revised estimates from the Congressional Budget Office released Tuesday. In reality, the deficit is even smaller than the CBO predicts, since its “current law” projections assume that funding for the war in Afghanistan and federal disaster relief for states hit by Hurricane Sandy will continue in perpetuity. But that funding isn’t endless, and it will bring the deficit down to even smaller levels.

Still, under CBO’s projections, the deficit is now half as large as it was in 2009, the year President Obama took office:

If the current laws that govern federal taxes and spending do not change, the budget deficit will shrink this year to $642 billion, CBO estimates, the smallest shortfall since 2008. Relative to the size of the economy, the deficit this year—at 4.0 percent of gross domestic product (GDP)—will be less than half as large as the shortfall in 2009, which was 10.1 percent of GDP.

The deficit is shrinking so rapidly because of spending cuts and new revenues and because CBO continues to revise down projected health spending. But that the deficit is shrinking so rapidly isn’t necessarily good news — as U.S. News and World Report’s Pat Garofalo put it, it is instead “one more piece of evidence showing that the economic discussion that has gripped Washington recently is absurdly backwards.”

Despite smaller deficits, congressional Republicans remain focused on spending reductions, and the most recent round of cuts has kicked children out of preschool, left cancer patients without needed screenings, and gutted programs that help low-income Americans in a variety of ways. Those cuts have also threatened to derail the economic recovery, which has sputtered along despite the headwinds created by a consistent focus on deficit reduction. In past recessions, increased government spending has pulled the U.S. to recovery. In this one, it has only made recovery harder.

The crisis the U.S. is facing isn’t the deficit. It’s that the unemployment rate is still 7.5 percent, and more than 4 million of those workers have been off the job for at least six months. A shrinking deficit might be good news in the long-term, but it isn’t putting people back to work or sparking a robust economic recovery. And yet, even with evidence that stimulus policies like the American Jobs Act would help, and despite the fact that the deficit continues to subside, congressional Republicans aren’t just ignoring the devastating impacts of sequestration — they are pushing for even more spending cuts in the immediate future.

Conservative U.S. politicians continue to press for austerity, but on the other side of the world, Australia’s government is moving in the opposite direction. That country largely escaped the economic downturn thanks to its abundant natural resources. But now Australia anticipates an economic contraction, and the government is adjusting its priorities accordingly.

Treasurer and Deputy Prime Minister Wayne Swan announced the shift from deficit reduction to economic investments in a speech to parliament, Bloomberg reports:

Australian Treasurer Wayne Swan will eschew European-style austerity as a stronger currency slows growth, wagering the government can win a Sept. 14 election fought on jobs and absorb the pain of a broken surplus promise. […]

“To those who would take us down the European road of savage austerity I say the social destruction that comes from cutting too much, too hard, too fast is not the Australian way,” Swan told parliament. “The alternative, cutting to the bone, puts Australian jobs and our economy at risk.”

Swan outlined a longer path back to the black that funds pledged spending on infrastructure, education and disability care, while saying restraint gives the Reserve Bank of Australia scope to cut record-low interest rates even further.

The reversal, forecast in December, acknowledges the economic reality that rapid austerity exacerbates economic troubles.

Meanwhile, the American fiscal policy debate has veered the other direction since 2011. Without the austerity measures Republicans have pushed and President Obama has signed over the past two years, economists say the U.S. unemployment rate would be a full percentage point lower. Obama’s American Jobs Act was projected to spur over two million new jobs when the White House proposed it in the fall of 2011, but Republicans blocked the bill. The U.S. will create 700,000 fewer jobs this year alone thanks to House Republicans’ decision to go ahead with massive “sequestration” cuts.

Congress shouldn’t need the Australian example, though. The contrast between the American recovery under fiscal stimulus and Europe’s austerity-driven return to recession is widely reported. The economic research Republicans have cited as motivation for immediate and sharp deficit reduction was proven entirely bogus just weeks ago.

As sequestration went into effect in March, some lawmakers argued that the impact of the cuts would not be as immediate as had been claimed, as they would take place over a matter of years. But there are some areas that felt the impact immediately. One of those is schools on military bases or Native American reservations. Because schools on or near federal lands don’t collect as much in property and sales tax revenues as other public schools, Impact Aid from the federal government helps close that gap. Yet sequestration will reduce the $1.2 billion the government sends to these communities by more than $60 million.

Different schools have different funding structures, but some are dealing with the impact of reduced spending right now, according to the latest report from the Center for American Progress:

This past month we discussed sequestration’s effect on schoolchildren living on Naval Air Station Lemoore in California. Schools in that district rely on Impact Aid for 30 percent of their entire budget. As Heiko Sweeney, principal of the base’s Akers Elementary School, explained, “For us, Impact Aid is critical.” The students and staff of Akers Elementary School are not alone in this regard: Federal Impact Aid accounts for more than half the budget for the Dulce Independent School District in New Mexico. In Mascoutah, Illinois, Superintendent Todd Koehl is expecting a 20 percent reduction in Impact Aid this year. “State and federal dollars are some of our biggest revenues,” said Koehl. And according to Dawn Kirby, vice president of the Travis Unified School District in California, Impact Aid provides them with “a lot of money. … That money has to come from somewhere. A lot of our students come from military families.”

While some school systems might be able to rely on reserves to make up some of the shortfall resulting from Impact Aid cuts, others such as the Tomah School District in Wisconsin are not as fortunate. “The only thing left is to reduce salaries and benefits or eliminate programs,” said Greg Gaarder, the district’s business manager. “There are no tools left in the toolbox.”

On the Wind River Indian Reservation in Ethete, Wyoming, a loss of $1.7 million in Impact Aid to School District 14 means a cut of 11 percent of the district’s overall budget. Such a drastic cut in Impact Aid will only serve to make a bad situation worse on reservations across the country. Native Americans have the lowest educational attainment of any racial or ethnic group in the United States. “We are at the mercy of the federal government,” said an unnamed District 14 school official. According to Michelle Hoffman, superintendent of District 14, Impact Aid is critical in addressing a host of problems: “Poverty, alcoholism, drug abuse.” She continued, “We have two full-time nurses in our district, which the state model does not cover. We pay for that through Impact Aid.”

The U.S. already ranked 44th in the world in the percentage of GDP spent on education in 2009. Sequestration will reduce that amount even further.

This is not the only way that it will impact spending on education and children, however. Low-income children are already being kicked out of Head Start programs. In total, 70,000 are expected to lose access to Head Start, while 1.2 million disadvantaged students will see funds eliminated for their schools. Special education programs will lose $633 million and $157 million will be cut from federal student financial aid. Low-income families will also lose $115 million in child care subsidies.

Congress acted swiftly to undo cuts to the Federal Aviation Administration that resulted in flight delays but has not moved to undo these cuts to education programs. While some lawmakers have proposed giving agencies flexibility in implementing the cuts, most agencies don’t have the reserves or funds to blunt the impact.

Last month, Kansas Gov. Sam Brownback (R) signed a package of stringent abortion restrictions into law, including a “personhood” clause that defines life as beginning at fertilization that puts abortion rights into jeopardy and could also endanger access to in vitro fertilization and some forms of contraception. Given that these new laws may skirt the legal precedent that a woman has a right to access an abortion, the state will have to spend money defending them from lawsuits. That sum could come to well over $1 million, as Kansas Attorney General Derek Schmidt has requested $500,000 more to fund the legal battle on top of the $800,000 it spent last year.

But Kansas has been dealing with budget cuts, particularly in Brownback’s most recent budget that reduced overall state spending by $465 million while also cutting income taxes. Taxpayer money that is being spent on defending these legally questionable laws could be going to many other important programs:

1. Restoring sequestration cuts: Sequestration is going to impact every state with its across-the-board cuts, taking a bite out of programs that have already dealt with decreased funding in recent years. With just over $1 million, Kansas could restore all funding to a variety of vital programs: law enforcement and public safety, job search assistance, vaccines for children, domestic violence services, nutrition assistance for seniors, and upgrades to public health threat response.

2. Tobacco prevention: Kansas ranks 39th in the U.S. for spending on tobacco prevention programs, as it spends under $1 million, just .62 percent of the $161 million it pulls in from tobacco-generated revenue. Yet prevention programs have been found to be highly effective at lowering tobacco use as well as cost effective: One study estimated that returns could be as much as $50 saved for every $1 spent thanks to avoiding tobacco-related health problems. The state could double its already low efforts with the money spent defending its new anti-abortion laws.

3. Arts funding: In 2011, Kansas became the first state without an arts agency when Brownback vetoed funding for the Kansas Arts Commission. The Kansas legislature had recommended appropriating just $689,000 to fund the agency, which would have allowed the state to continue receiving $1.2 million in federal and regional arts funding. The state funding could more than be restored, bringing arts grant dollars back to the state and reinvigorating an arts and nonprofit sector that generates $153.5 million a year in economic activity.

4. Drinking water protection: As part of the spending cuts in Brownback’s most recent budget, he used his line-item veto on some programs, including $800,000 for LEPP, the Local Environmental Protection Program. That program provided grants to local health departments to monitor wastewater and water systems and enforce regulations in order to protect drinking water. State officials have warned that without the program, the state will see increased health problems, lawsuits, and local fees for installing septic tanks and other systems, as well as non-compliance with federal environmental laws.

5. Higher education: College and university budgets have been struggling with decreased state funding, and Kansas is no exception. One community college, Kansas City Kansas Community College, stands to lose about $430,000 from its budget if a 2-4 percent cut to higher education funding goes through. The cut has been proposed as one way to reduce spending in the wake of Brownback’s income tax cuts. If the funding is cut, the college may have to increase tuition on top of the $6 per credit hour increase this past semester. Yet many of the students are young and some are unemployed, making it difficult for them to shoulder more costs, a school official said.

6. Public education: Education spending is predicted to drop $216 per student after the tax cuts Brownback signed into law on top of a $745 decline between 2008 and 2013. Yet a state court ruled that the state is short changing students and must restore $440 million in education spending. While $1 million is just a drop in that bucket, it could go toward ensuring that Kansas’s children get the well-funded education that they deserve.

Kansas is spending a large amount of money defending its anti-abortion laws, but it’s far from the only state doing so. North Dakota has signed the most stringent abortion restrictions in the nation into law, leading the attorney general to request a budget increase of $400,000 to defend them from lawsuits. Arkansas is also gearing up to spend state money defending its new ban on abortions after 12 weeks. At a time when many states have been grappling with tight budgets, the sums of money spent on defending against lawsuits could be used elsewhere.

Last week, ThinkProgress spoke to directors of Meals on Wheels programs across the country, and they detailed how sequestration is cutting meal delivery and on-site meal services to needy seniors who may now have to go hungry. Since then, stories about sequestration’s harmful cuts to seniors have continued to pour in from across the country. The stories from Florida and Maine have been particularly wrenching:

• Throughout Florida, meal services for seniors have been cut. In the Orlando area, five senior meal sites are closing, another 20 seniors are losing their home support services, and other seniors will lose their transportation services, including help getting to medical appointments. Similarly, Aging Matters in Brevard had to close two of its lunch sites. In Ocala, Marion Senior Services will serve 6,000 fewer meals in 2013. Meanwhile, Holly Hill, Ormand Beach and six other locations from Deland to New Smyrna Beach had to cut its on-site meals from 5 days a week to 4 days a week while the waiting list for home-delivered meals is at 2,356 and growing. These may just be numbers to some, but not to the seniors who depend on the meals. Sometimes, these meals are seniors’ “only hot meal of the day.”

• The same stories are playing out in Maine. In central Maine, Spectrum Generations has had to cut its meal delivery service to just once a week, while Eastern Agency on Aging in Bangor had to furlough its employees once a week. “It is having a tremendous impact on people who need services…These are services that help to keep people — the elderly and the disabled — living in their homes and in their communities rather than living in institutions, which are much more expensive,” said Jessica Maurer, executive director of the Maine Association of Area Agencies on Aging. Meanwhile, in midcoast Maine, the Meals on Wheels program is facing funding shortfalls that may impact its on-site meal service program.

But losing crucial nutrition support services is not the only way sequestration is hurting seniors. It is also robbing $75 million from Aging and Disability Services programs. These include programs that protect vulnerable adults from elder abuse, that support services for people experiencing Alzheimer’s disease, and that provide home and community-based services that allow seniors to live at home for as long as possible. These drastic cuts are funneled down to the local level in various forms, from funding cuts to senior centers in Missouri to layoffs at a hospice in Kentucky.

In total, sequestration is cutting more than $230 million to four critical programs that support seniors. It cuts $117 million from Social Services Block Grants, which fund Meals on Wheels and other important initiatives, $75 million from Aging and Disability Services programs, $23 million from Community Service Employment for Older Americans programs, and $19 million from Housing for Elderly programs. But while Congress rushed to stop flight delays right before they flew home for recess, they have done nothing to ease the pain of these cuts on seniors.

We’ve laid out before some revenue options that can help ease the sequester. Many have been suggested in the president’s budget, including the elimination of the special tax break for derivatives traders that would yield $2.4 billion — well more than what is needed to stop sequestration’s harmful impacts on seniors. Ending subsidies for corporate jet owners and tax breaks for golf courses would get us halfway there. And so we ask this question again: what, exactly, are Congress’ priorities?

Our guest blogger is Anna Chu, Policy Director for the ThinkProgress War Room at the Center for American Progress Action Fund.

In response to the outcry from business travelers, the airline industry, and others affected by growing flight delays, Congress stepped in last week to provide the Federal Aviation Administration (FAA) with “flexibility” to move funding around within the agency to avert scheduled furloughs of air-traffic controllers necessitated by the automatic budget cuts known as sequestration. Congress remained unmoved as meals on wheels went undelivered, cancer clinics turned away patients, domestic violence programs were slashed, and children were dropped from Head Start programs across the country.

Flight delays highlighted just one of the problems with sequestration due to the unique situation of the FAA. Unlike other agencies, the FAA has a relatively large amount of funding set aside for long-term construction and maintenance projects. This funding is not spare cash, but a large pot of money not currently being spent on high-priority short-term needs. Replacing air traffic controller furloughs with cuts to these funds was impossible under sequestration, so Congress had to pass a law to give the FAA the flexibility to make the tough choices itself.

This approach is only a Band-Aid for the FAA, which will now pay air traffic controllers at the expense of long-term priorities Congress had already approved. For other agencies to which Congress may be tempted to give the same flexibility, however, it is completely unworkable. Most agencies do not have large capital accounts like the FAA. Their funding is instead spent on staffing, projects, and grants this year, and their programs have already been cut to the bone, as the Center on Budget and Policy Priorities explains:

Take, for example, the Department of Health and Human Services (HHS). Many have decried cuts in the National Institutes of Health, Head Start, and seniors programs (such as meals on wheels and other supports that help frail seniors live in the community), all of which are within HHS.

These three areas together comprise half of all discretionary funding within HHS. Suppose Congress gave HHS the flexibility to shift funds to undo sequestration in these areas. If HHS used that authority to shield these areas from reductions, the cuts in all other HHS programs would have to roughly double, on average.

That means doubling the cuts in areas such as food and drug safety, disease prevention, child care and energy assistance for low-income families, mental health and substance abuse treatment, the Indian Health Service, community health centers, and HIV/AIDS treatment.

“Flexibility” would not create a magic new source of funding for all the crucial programs within HHS, and there is no extra funding floating around without a purpose. HHS cannot shelter one key program without deepening the cuts to another. Most agencies look like HHS, not the FAA. The Department of Justice cannot protect the grants administered by the Office on Violence Against Women without increasing cuts to other key DOJ priorities or furloughing the attorneys who administer them.

This highlights the main problem with sequestration: domestic programs have already been cut to the bone, and any further spending reductions are extremely damaging. In fact, Congress’s newfound desire to grant the president more “flexibility” is a direct result of the harshness of these cuts – congressional Republicans insist on a cuts-only approach but are unable to identify cuts that would not be equally damaging to national priorities.

By closing loopholes and limiting deductions that benefit America’s wealthiest citizens, Congress could completely replace sequestration, restoring services to the poor, children, and the elderly, reinvesting in priorities like scientific research, food and drug safety, and HIV/AIDS treatment, and bringing balance back to a deficit-reduction approach that has relied disproportionately on spending cuts instead of revenue increases. Congress should act to fix the problem it has created, not play games to shift political blame while the economy and vital public programs suffer.

Our guest blogger is Kitty Richards, the Associate Director for Tax Policy at the Center for American Progress Action Fund.