Foreign economic terms (voucherization, privatization, sequestration) were often used in the nineties of the last century. There were two main reasons for this. Firstly, the new states that emerged on the territory of the former USSR were rapidly transitioning to market relations, and, apparently, the Russian words, with all the richness of our language, were not enough to describe this process. And secondly, in the confusion that arose, many politicians and economists wanted to veil their (sometimes very unsightly) activities, expressing themselves inexplicably.
Unpleasant word
The word “sequestration” was widely used in everyday speech after the financial crisis of 1997, when the use of funds to ensure the implementation of most budget programs was forcibly limited. This measure was caused by misuse of the allocated money, and, consequently, their shortage. Many socially unprotected sections of the population suffered, and since then, the opinion that sequestration is something bad has been firmly rooted in the minds of people. The way it is.
The Latin word “sequestro”, which has been transferred to other modern languages of the world, literally expresses the concept of separating a fragment from the main part. It is used not only in economic vocabulary, but also in other branches of human activity.
Law
In cases where property disputes arise regarding real estate, production equipment, consignments and other economic assets held by one of the conflicting parties, a sequestration agreement is applied in world practice. It is tripartite and is concluded between two entities, one of which makes a complaint to the other, and another participant who assumes responsibility for the storage and security of disputed property, which no one can use until the court decides. The storage service is most often paid or, less commonly, free of charge. Upon the expiration of the term or after receipt of a court decision, the contract expires and the owner takes over his rights.
Thus, in a legal sense, sequestration is a temporary alienation of disputed property. But what about other industries?
In medicine, sequestration is a partial necrosis of tissues
It is always unpleasant to talk about diseases, and in this sense the medical term is similar to the legal one. Doctors are sometimes forced to use words that sound scary both in Russian and in Latin.
Sometimes the inflammatory process (for example, osteomyelitis) develops so sharply that it leads to local necrosis of the body tissue, which doctors call sequestration. Most often this happens to the bone. Some of its cells lose the properties that distinguish a living body from a dead one, and separation occurs. The border between the healthy part and the affected area is fibrous and sclerotic bone tissue. On X-rays in this place, a seal is noticeable. Like any foreign body, necrotic tissue causes irritation and inflammation, up to the formation of fistulas. There is only one way out - an operation, the surgeon removes the sequestration, this is called sequestrectomy in medicine.
Budget cuts as an emergency measure
Any budget, regardless of whether it is a family budget, city, regional or national, consists of two parts: revenue and expenditure. The country receives funds from taxpayers in the form of fees, duties, as well as from various types of economic activity. Spending this money is necessary to ensure the work of governing bodies, the maintenance of educational institutions, medicine and other government agencies, called "budget". The maintenance of combat-ready armed forces and law enforcement agencies costs, as they say, “a pretty penny”, as does the development and purchase of new equipment for security officials. But these expenses cannot be dispensed with, and their reduction sometimes threatens, as the history of recent decades shows, with the most dire consequences.
The reason for the need to reduce costs is an unforeseen excess of their volume or a sudden reduction in revenue to the treasury. Budget sequestration is justified in circumstances threatening the financial security of the state, with insufficient gold and foreign exchange reserves and the impossibility of external borrowing.
This happens, but very rarely. Usually, all expenses, including a certain percentage of unforeseen expenses, are included in the expenditure part of the budget, and if the receipts are planned correctly, then we can say that it was drawn up correctly.
In a macroeconomic sense, budget sequestration is the limitation of the use of funds for the performance of certain government functions. Most often, the degree of cutback in financing is expressed as a percentage (by 10%, by 20%, etc.). However, no matter how bad things are in the state, there are articles that cannot be adjusted, that is, protected.
