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Congressional Budget Process "Reforms" - An Attack on Human Needs Programs |
Current rating: 0 |
by Coalition on Human Needs (No verified email address) |
17 May 2004
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The ostensible motivation behind conservatives' zeal for budget process reform is concern about the deficit, which they view - falsely - as being fueled by a massive growth in spending. But it was the huge tax cuts of 2001 and 2003 passed under Republican leadership - not increases in spending - that helped turn a record surplus into a massive deficit. |
May 14 - In June, the House of Representatives will consider making changes in how Congress writes a federal budget. Some changes under discussion would shrink nearly every human needs service or program the federal government funds. Two bills introduced in the House include provisions that would cut $1.8 trillion over the next ten years from essential services like Medicaid, Medicare, and Food Stamps (those that do not need annual funding approval.) Deep, five-year caps on other vital programs whose funds must be approved annually would cut at least $113 billion over the next decade. Other provisions would change the ground rules for the budget debate and would have the effect of increasing Congress' incentives to hand more tax breaks to the wealthy and special interests while making it difficult - if not impossible - to invest more federal resources in human needs programs and services.
There are three separate budget process reform bills in play, although only one of them, HR 3973, will be the vehicle that is voted on. The House Budget Committee approved HR 3973 (sponsored by Budget Chairman Jim Nussle (R-IA)) along with the FY 2005 budget resolution in March, and House Majority Leader Tom DeLay (R-TX) made a promise to conservative lawmakers to bring it to the floor for a vote.
But before going to the floor, the bill must be approved by the Rules Committee, which may borrow provisions from two other, more ambitious budget process bills (HR 3800 and HR 3925) and add them to the underlying bill or make them in order as amendments. Leadership has indicated the bill will probably go to the floor in June.
The ostensible motivation behind conservatives' zeal for budget process reform is concern about the deficit, which they view - falsely - as being fueled by a massive growth in spending. But it was the huge tax cuts of 2001 and 2003 passed under Republican leadership - not increases in spending - that helped turn a record surplus into a massive deficit.
The threats to low-income families contained in the budget process reform plans are manifold. Here are some of the most dangerous provisions:
1. Unprecedented Cuts to Essential Human Needs Programs (Entitlements): Both HR 3925 and HR 3800 bill cut entitlement spending by $1.8 trillion over ten years, including nearly $800 billion from Medicare, nearly $400 billion from Medicaid, $43 billion from food stamps, $69 billion from unemployment compensation, $37 billion from welfare-to-work, child care and child support enforcement, and $13 billion from foster care and adoption assistance. Every single entitlement program except Social Security is at risk, including student loans, State Children's Health Insurance Program, the Earned Income Tax Credit, and veteran's benefits. Although HR 3973 does not currently contain entitlement cuts, it is possible that the Rules Committee will add these provisions or allow an entitlement cut amendment to be voted on the floor.
2. Deep Caps on Services Needing Annual Approval (Discretionary Spending): All three bills under consideration would keep spending for discretionary programs below levels agreed to in the House budget plan. Over ten years, the spending caps would require cuts of at least $113 billion to programs like education, special education, some care welfare and child care programs, certain nutrition programs, health research, and environmental protection, and more over the next ten years.
3. Changing the Ground Rules for Passing a Budget: HR 3800 and HR 3925 would change the ground rules for passing a budget to make it easier for Congress to pass more tax cuts that are not paid for and make it harder to increase needed spending. Both bills require Congress to pay for any increases in entitlement spending by cutting entitlement spending elsewhere. At the same time, Congress would not be required to pay for new tax breaks, allowing them to make the deficit deeper and deeper. This lopsided version of "pay-as-you-go" rules would encourage Congress to continue passing tax breaks for the well-off while making it very difficult to expand programs like Medicaid, the Earned Income Tax Credit, the State Children's Health Insurance Program, or Food Stamps.
In addition both bills would require the Congressional Budget Office (CBO) to change how it calculates the cost of discretionary programs. Currently, the CBO estimates costs by looking at the current level and taking into account the inflation expected for each future year. These bills would require CBO to leave out an adjustment for inflation. Now, programs that are flat-funded are accurately shown by the CBO as being cut - because rising costs mean that each year the unchanged funding will purchase less. The effect of this change would lead to bigger cuts in discretionary spending over time because funding that merely keeps pace with inflation would look like an increase in spending under the new calculation rules.
Next steps
It is unlikely that the Senate will take any action this year on budget process reforms, but these proposals are just the first steps in a long-term campaign by conservatives to severely restrict the size and role of the federal government. These proposals are so troubling to human needs programs that we will be tackling them this year - educating members about the damage they could do to the programs and people we care about. Look for a future email from the Opportunity for All campaign outlining action steps you can take to stop these rules from advancing.
For More Information
Center on Budget and Policy Priorities: Key Issues and Threats in the House Budget Process Debate
http://www.cbpp.org/5-17-04bud.htm
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Know the Budget Lingo
If the federal budget is new to you, or if you've always focused on one specific part, some of the terms may be confusing. A full glossary is available on the Coalition on Human Needs website (http://www.chn.org/pdf/budgetglossary.pdf). Below, we explain "entitlement" and "discretionary" spending:
Entitlements are services or benefits that do not require annual approval of funds from Congress. They include some of the most basic human needs programs, such as Social Security, Medicaid, Medicare, Temporary Assistance for Needy Families, Food Stamps, Unemployment Insurance, etc. Entitlement programs are not subject to annual appropriations because Congress has viewed them as requiring assured funding. That does not mean Congress has no control over them. Congress can choose to make changes in entitlement programs under current budget procedures, by requiring the committees that oversee the programs to spend less than what would be expected under current law. The committees then figure out how to reduce spending, by curbing inefficiencies, restricting eligibility, reducing benefits, or charging more for services. Some of the budget rules proposals now being considered would require reductions in most entitlement spending.
Discretionary programs require annual approval of funds (appropriations) from Congress. Many vital services are funded this way - like housing subsidies, WIC (Women, Infants and Children nutrition), education and training, certain child welfare services, etc. The budget rules now being considered would set limits (caps) on spending in these programs.
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Join the Opportunity for All Campaign
The choices in the federal budget will make a profound difference in the lives of millions of Americans. Is the door to opportunity slamming shut, or will people get the chance to find and keep a decent job and provide for their children, and to have health coverage, affordable housing, and a secure retirement? Because these choices are too important to be left to a handful of insiders, the Coalition on Human Needs has started the Opportunity for All Campaign. In order to succeed, we need tens of thousands of advocates to receive timely information and to speak out in favor of fair and commonsense budget decisions. If you would like to be a part of the Opportunity for All Campaign, send an email to Adam Hughes at ahughes (at) chn.org |
See also:
http://www.chn.org/humanneeds/article.asp?Art=2129 |