Wednesday, March 25, 2015

Congress to Balance Budget on the Backs of the Poor

Senate Budget Committee Chairman Mike Enzi’s new plan proposes to balance the budget in ten years through massive cuts in domestic programs, with no revenue contribution over that time. The Center on Budget and Policy Priorities estimates that the Senate Budget plan and the House Budget Committee plan will get 69 percent of their cuts from programs that benefit low and moderate income people.

The Stated Clerk of the General Assembly, when discussing priorities in the federal budget, wrote “we know that we are responsible to each other and, as the Gospel of Luke teaches us, ‘from everyone to whom much has been given, much will be required.’  We, therefore, urge a solution to the…. federal deficit that ensures long-term fiscal stability; deficit reduction; just, new revenue; long-term integrity for entitlement programs; and a priority on the most vulnerable in society[1].”

The published budgets would slash essential funding and weaken the federal safety net at a time when many families have yet to fully recover from The Great Recession. Here is a closer look at what gets cut and what programs are safe:
  •      Health care for low- and moderate-income people. Each plan would repeal health reform, including its subsidies to make coverage affordable for people with low or moderate incomes and its Medicaid expansion, and block-grant much of Medicaid, while also making deep cuts to the program.  At least 14 million people would lose their Medicaid coverage or no longer gain coverage in the future[2].
  •      SNAP (formerly food stamps). The House plan block-grants SNAP starting in 2021 and cuts SNAP funds by $125 billion, or more than a third, over 2021 to 2025.  Cuts of this magnitude would end food assistance for millions of low-income families, cut benefits for millions of such households, or do some combination of the two.
  •      Tax credits for low- and modest-income working families. Each plan would let critical provisions of the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC) expire at the end of 2017, which would push more than 16 million people, including almost 8 million children, into or deeper into poverty.
  •      Other mandatory (i.e. entitlement) programs serving low-income people. The House and Senate plans would each cut hundreds of billions of dollars from mandatory programs in the education and income security categories of the budget.  Although each plan lacks specifics, severe cuts of up to 90 billion dollars would occur to Pell Grants, which help students from families with modest incomes afford college.
  •      Low-income non-defense discretionary programs. The House and Senate plans each would make additional cuts on top of the significant reductions required by the Budget Control Act’s discretionary caps and sequestration.  These cuts would shrink the funds available for investments in education, research, and transportation, as well as for low-income programs such as housing assistance, Head Start, and the Low Income Home Energy Assistance Program[3].
  •              Military Spending is Safe. The House and Senate would both stay within the budget caps for the Pentagon’s base budget ($523 billion) in 2016 but the House would significantly increase the war funding account to $90 billion, and would add $397 billion to the Pentagon accounts over the next 10 years[4].

[1] Gradye Parsons,  “Addressing the Moral Concern of Deficits through Principles, not Politics”