Oct. 31, 2005 – Facing a huge deficit and a looming deadline to concoct a budget agreeable to both chambers of Congress, lawmakers recently made a number of decisions that would adversely affect the poorest and least-influential people in the United States. In the name of cost cutting, several Senate and House committees agreed to or proposed to slash huge amounts of money from several key anti-poverty programs, including Medicaid, Medicare and food stamps last week.
- Debate Over Renewing Welfare Reform Reveals Cracks in the System (Apr 30, 2005)
- Congress May Cut Food Stamps Despite Growing Need (Aug 1, 2005)
- Lawmakers Continue Pushing Cuts to Social Spending, Taxes (Oct 11, 2005)
- Americaâ€™s Income Gap Continues to Grow* (Oct 18, 2005)
- Competing Minimum Wage Bills Nixed in Senate (Oct 21, 2005)
The proposals arise from Congressâ€™s need to reconcile competing Senate and House appropriations packages. The final package is expected within the next few weeks. Both houses are also considering steep tax cuts and possibly expanding a number of exemptions that would directly benefit the nationâ€™s wealthiest.
Though both the House and Senate have offered plans to enact program cuts, many concerned over the loss of billions in federal poverty aid see the House plan as more onerous than the Senateâ€™s.
According to the Center on Budget and Policy Priorities (CBPP), a progressive economic think tank, the House reconciliation scheme represents an "unshared sacrifice" because it cuts billions in aid to middle- and low-income people while failing to rein in any of the past four yearsâ€™ tax cuts, which generally benefited the richest people most.
The CBPP report outlines six discrete groups that the package would burden most: disabled poor people, children depending on child support, families needing childcare assistance, foster children living with relatives, Medicare and Medicaid beneficiaries, and the lowest-income food-stamp recipients.
CBPP estimated that 225,000 working families and another 70,000 documented immigrants will have their food-stamp eligibility denied or delayed under the House plan. The package would also cut child-support enforcement by $5 billion over five years, delay by a year back Supplemental Security Income payments, and change the way foster care and Temporary Assistance to needy Families payments are made.
In addition, people with incomes just one-third above the official poverty line are likely to see their Medicaid premiums increase and will be forced to pay new fees for non-preventive care, including hospital stays and laboratory work, the report found.
Last week, the American branch of Oxfam, an international relief agency, raised questions specifically about the House Agriculture Committee decision to cut $3.7 billion from both its anti-hunger and its conservation programs, even as it gives millions in subsidies to giant factory farms. The organization expressed disappointment that the committee would seek cuts in food-stamp funds while failing to reform federal subsides to agribusinesses.
"The opportunity was there to reform a system rife with loopholes that has allowed mega-farms to collect subsidies that exceed $1 million," Oxfam America legislative director Charly Moore said in a statement Friday. "What's worse is that not only did the committee take a pass on reforming subsidies via budget reconciliation, they slashed anti-hunger and conservation programs instead."
The Senate plan, on the other hand, does not call for cuts to food stamps, but trims about $3 billion from other agriculture programs.
The Coalition on Human Needs, a group of public-interest, labor, immigrant, religious and other advocacy organizations, prefers the Senate plan to the Houseâ€™s but says both are plagued by equity problems.
Stating that "in general, the Senate bill is less draconian than the House bill in terms of cuts that will affect low-income people," the Coalition noted that the Senate plan fails to reauthorize Temporary Assistance for Needy Families and cuts $13.7 billion in student loan funds, in addition to adversely changing the way Medicaid and Medicare are doled out.
The various cuts expected to be included in the final budget package come shortly after the Senate rejected two separate bills to increase the federal minimum wage. They follow the release of numerous statistics showing that poverty and homelessness are on the rise while the income gap between rich and poor continues to widen.