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See also:

• The Right Choices to Cut Poverty and Restore Shared Prosperity by Melissa Boteach, Shawn Fremstad, Joy Moses, Erik Stegman, and Katie Wright

SOURCE: AP/Tony Dejak

Republican vice presidential candidate Rep. Paul Ryan, R-Wis. waves after speaking to supporters about upward mobility and the economy during a campaign rally at the Walter B. Waetjen Auditorium at Cleveland State University, Wednesday, October 24, 2012, in Cleveland, Ohio.

In a speech at Cleveland State University yesterday, Republican vice presidential candidate Rep. Paul Ryan (WI) talked about upward mobility and the economy. But instead of offering real solutions to lift more than 46 million Americans out of poverty and create an economy that works for all, Rep. Ryan stuck to conservative rhetoric that paints safety net programs as the problem rather than as the essential support for struggling families who fall on hard times. Rep. Ryan’s reliance on rhetoric served to veil the policy proposals he supports, which would devastate families and children living in poverty.

As telling as what Rep. Ryan said is what he didn’t say. Though 10.5 million Americans are working poor—meaning that they spent at least half the year in the labor force but their incomes were still below the poverty line—he provided no policy prescriptions for improving job quality, such as increasing the minimum wage, continuing tax credits for working families, or providing paid sick days so that parents don’t have to worry about losing their job when their child gets sick.

Here are nine ways Rep. Ryan’s empty rhetoric in his speech yesterday masks the reality his policies would create for families in need.

Jobs

Empty rhetoric: “But above all else is the pressing need for jobs. … [Gov. Romney] has set a clear goal: 12 million new jobs over the next four years.”  

Reality: Experts debunk this claim.[1] Analysis by the Center for American Progress Action Fund reveals that the Romney economic plan would actually result in lost jobs or, at best, only add a fraction of the jobs created under President Barack Obama’s current economic policies.[2]

The safety net

Empty rhetoric: “Where government is entrusted with providing a safety net, Mitt Romney and I have our own vision for how to keep it strong.”

Reality: Rep. Ryan’s budget would devastate the safety net by making deep cuts and converting essential programs into block grants. His Medicaid cuts would cause 31 million Americans to lose access to health insurance over the next 10 years. And his budget would kick 8 million to 10 million people off of nutrition assistance.[3]

Rhetoric: Government antipoverty programs foster a “culture of dependency.”

Reality: Three times as many people who rely on supplemental nutrition assistance have income from work compared to those who rely on the Temporary Assistance to Needy Families program.[4] Rep. Ryan fails to address the proliferation of low-wage work that keeps working families mired in poverty.

Empty rhetoric: “Welfare reform worked. … we saw child poverty rates fall over 20 percent in four years.”

Reality: Rep. Ryan doesn’t mention that child poverty rates then proceeded to rise again as soon as the Great Recession of 2007–2009 hit,[5] and that the temporary income assistance provided to these families in dire need has lost 30 percent of its value since 1996. The program was not equipped to respond to the sharpest economic downturn since the Great Depression.[6]

Equal opportunity

Empty rhetoric: “We owe every child a chance to succeed.”

Reality: The very services and supports that kids and families struggling with poverty need to succeed would face drastic cuts under Rep. Ryan’s own budget. Under his plan 191,000 kids would lose access to early education, 22 million kids could lose or see reduced nutrition assistance, and child care would be cut for 4 million children.[7]

Empty rhetoric: “Sending your child to a great school should not be a privilege of the well to do.”

Reality: Yet when it comes to higher education, Rep. Ryan supports cuts to Pell Grants, which enable young adults from low-income backgrounds to attend college. In 2013 alone he would cut Pell Grants by 42 percent, which would eliminate grants for more than 1 million students, reduce remaining grants for others, and increase the burden of student loan debt on young people and their families.[8]

Empty rhetoric: “Even though so many barriers to equality have fallen, too many old inequities persist. Too many children, especially African American and Hispanic children, are sent into mediocre schools and expected to perform with excellence.”

Reality: Republican presidential candidate Mitt Romney’s plan would do nothing to fix unfair and inequitable school funding systems that, on average, send $733 more per student to mostly white schools than mostly nonwhite schools.[9] Moreover, his plan would do nothing to fix or improve chronically underperforming schools.[10]

The federal debt

Empty rhetoric: “Debt on this scale is destructive in so many ways, and one of them is that it crowds out civil society by drawing resources away from private giving.”                 

Reality: Private charities cannot alone meet the needs facing America’s poor. Should cuts to supplemental nutrition assistance in the Ryan budget take effect, churches across America would need to come up with $50,000 each to make up the difference.

Empty rhetoric:  “Even worse is the prospect of a debt crisis, which will come unless we do something very soon. When government’s own finances collapse, society’s most vulnerable are the first victims.”

Reality: Poverty reduction and deficit reduction are not mutually exclusive goals. A budget plan put forth by the Center for American Progress demonstrates that we can dramatically reduce poverty and balance the budget by 2030.[11]

Katie Wright is a Research Associate at the Center for American Progress Action Fund.

Endnotes

SOURCE: AP/Ted S. Warren

Kim Nieves, right, gives her son Ruben, 13, a playful tug on the ear as she talks about her financial struggles as a single parent.

Endnotes and citations are available in the PDF version of this issue brief.

House Republicans continue to play election year political games with waivers to the Temporary Assistance to Needy Families program, scheduling a vote tomorrow on a resolution that would stop an Obama administration effort that gives states more flexibility in crafting services to help more poor single mothers find work. The House leadership is pushing the vote in tandem with prominently featured television ads produced by the Romney presidential campaign that falsely claim the waivers sought by Republican and Democratic governors alike will enable low-income Americans in need of temporary financial assistance to not work.

This feigned Republican “outrage” persists despite various fact checkers debunking Gov. Mitt Romney’s claim that the Obama administration wants to eliminate work requirements. What’s more, as governor of Massachusetts nearly a decade ago, Romney actually requested the same leeway to experiment with better ways to help low-income Americans find work.

At risk in this political play is the best interests of low-income mothers and their children who struggle daily to make ends meet.

The current debate is rooted in the history of welfare reform. Between welfare reform’s passage in 1996 under President Bill Clinton and the year right before the next recession in 2000, the poverty rate for families with children dropped from 16.5 percent to 12.7 percent. Welfare reform played a role in this change—states put an intensive new focus on women’s work and substantial new investments were made in work-enabling child care. But the big picture was dominated by a strong 1990s economy defined by low unemployment rates and readily available jobs.

But as the booming 1990s came to a close and the first of two recessions under President George W. Bush approached, significant cracks in the Temporary Assistance for Needy Families program became readily apparent, including:

• Increasing single-mother family poverty
• Working poor mothers with little help with child care or workplace flexibility
• Rising deep poverty—measured at 50 percent of the poverty line, or $9,062 for a family of three in 2011
• Rising poverty especially for single mothers facing work barriers
• The lingering consequences of the Great Recession

These issues represent significant challenges for families and for states charged with reducing reliance on temporary government financial assistance. This is where flexibility came into play. The Obama administration asked the states to submit waiver requests to “allow states to test alternative and innovative strategies, policies, and procedures that are designed to improve employment outcomes for needy families.”

So let’s unpack each of these challenges in order to better understand the circumstances affecting states, including those with Republican governors who have previously supported waivers.

Increased single-mother family poverty

Households headed by single women, the primary group of Americans targeted by the old welfare program and the current Temporary Assistance for Needy Families program, continue to experience persistently high rates of poverty. Currently, 40.9 percent of these families are poor, compared to 18.5 percent of all American families. A further concern is a reversal in previous gains among these families—their poverty rate reached a low of 32.5 percent in 2000 but has steadily increased since then, closely approaching the number that existed in the year before welfare reform. (see Figure 1)

The most recent decade also witnessed decreases in women’s workforce-participation rates. According to the U.S. Census Bureau, more single-mother households throughout the decade began reporting that they didn’t work during the year because they couldn’t find work, or because they were going to school. This pattern continued during the Great Recession of 2007–2009, with data suggesting that mothers were struggling to find work and/or were using the downtime in the economy to gain more education to prepare them for future work. State programs may need some flexibility to account for these women.

Working poor moms with little help with child care or work flexibility

The majority of poor single mothers participate in the labor force. This means that there were 2.2 million poor single mothers who were either working or actively searching for work in 2011—58 percent. Since 1999, when the Census Bureau began publishing this data, their numbers haven’t dropped below 1.8 million.

But if states simply focus on whether women are in the workforce, with no concern about their job stability and level of earnings, the women (and their children) could continue to be poor. Progress requires improvements in areas that improve job stability and earnings such as access to affordable child care and jobs that offer paid leave. State waivers could lead to innovations in these areas and others that would improve women’s employment outcomes, decreasing their reliance on public assistance.

Deep poverty rising

As with the general child-poverty rates, deep poverty—measured at 50 percent of the poverty line, or $9,062 for a family of three in 2011—among children dropped during the good economic times of the mid-to-late 1990s, falling from 10.2 percent to 6.4 percent between 1992 and 2000. But in the 2000s, these numbers began to trend upward even before the onset of the Great Recession. They now mirror numbers that existed before welfare reform.

By the end of 2008, the first full year of the Great Recession and the end of the George W. Bush administration, 8.5 percent of children lived in deep poverty. In 2011, as the nation continued down the path to economic recovery, that number rose to 9.8 percent, reflecting the deepening inequality in our economy. Half of those in deep poverty get out of it in a year’s time, suggesting that they experience temporary setbacks such as a parent’s loss of consistent work or a work-preventing illness. But there is much more still to be learned about this group at the very bottom of the economic ladder—suggesting a need for further research and program innovations at the state level.

Rising poverty especially among single moms with work barriers

The emphasis on closing temporary financial assistance cases is associated with increases in the number of “disconnected mothers,” or women living in poverty who are neither working nor receiving any temporary assistance. These women are poor because they face significant or sometimes multiple barriers to entering and remaining in the jobs market.

A Bureau of Labor Statistics study found that the two biggest reasons these women cite for being out of the workplace are the need to provide care for others (for example children with disabilities or ailing parents) and their own chronic illnesses or disabilities. Exact circumstances vary by family.

Access to well-designed work supports such as care arrangements for family members or appropriate accommodations and services for workers with disabilities may allow more of these women to either return to work or work more hours. States may need waivers to develop innovations in these areas.

The lingering consequences of the Great Recession

The two recessions that bookmark the last decade occurred after the welfare reform of 1996 and both were accompanied by increases in poverty. During those periods, however, the Temporary Assistance for Needy Families program was much less responsive than other public benefits programs likely due to the program’s primary focus on caseload reduction.

This emerging pattern was particularly striking after the Great Recession because women workers experienced unemployment rates in 2010 and 2011 that had not been seen since the mid-1980s, suggesting many families and children may not be getting the additional help they need during even the worst of economic times. Waivers could allow states to develop creative responses in such difficult times that are still focused on employment. (see Figure 2)

Conclusion

The Obama administration did not initiate waivers to the Temporary Assistance for Needy Families program as a means of abandoning the goal of work for low-income families. Governors from both political parties realized that low-income single mothers were continuing to face significant work and income challenges after welfare reform in 1996—challenges that hindered their ability to get off temporary financial assistance and stay off. This suggests a need for new and innovative approaches. The Obama administration invited proposals, particularly those that would “help parents successfully prepare for, find, and retain employment.” Extra safeguards include a showing that proposals are reasonably likely to meet the work goals of the Temporary Assistance for Needy Families program and the required development of evaluation plans.

Thus it is clear that the intention behind the waivers is a win-win for families and states—parents would have improved work-and-income outcomes that allow them to provide for their children and states would have the flexibility to find new and improved ways to reach their goal of reducing reliance on public assistance programs. Gov. Romney and congressional Republicans who somehow want to translate noncontroversial issues into campaign victories should not be allowed to affect this equation or the outcomes achieved by families and states.

Joy Moses is a Senior Policy Analyst with the Poverty team at the Center for American Progress Action Fund.

SOURCE: AP/M. Spencer Green

Gov. Mitt Romney's plan, along with his endorsement of Rep. Paul Ryan's budget, calls not for an attack on poverty but for an attack on the poor themselves.

Endnotes and citations are available in the PDF version of this issue brief.

Shortly after his victory in the Florida GOP primary, Republican presidential candidate and former Massachusetts Gov. Mitt Romney slipped up by admitting, “I’m not concerned about the very poor. We have a safety net there. If it needs repair, I’ll fix it.”

The media covered the statement as the latest in a long line of gaffes. But a closer look at Gov. Romney’s policy proposals reveal that the real problem is not a penchant for verbal missteps but a flawed vision for ensuring more families can access the American Dream.

Indeed, by picking Rep. Paul Ryan (R-WI) as a running mate, Gov. Romney is doubling down on a strategy that would increase economic hardship, erode the middle class, and send more struggling Americans deeper into poverty. Campaigning with Rep. Ryan by his side, Gov. Romney has aligned himself with the radical Ryan budget plan that gets two-thirds of proposed cuts from programs that help low-income Americans.

Gov. Romney has claimed that his choice of a running mate does not imply a full-throated endorsement of the Ryan budget plan. And he’s right. To the extent Gov. Romney has articulated his own policies apart from the Ryan budget, they are even more radical than Rep. Ryan’s blueprint, with larger tax breaks for the wealthy and even deeper cuts to health care, nutrition aid, veterans’ services, education, and other fundamental supports for the middle class.

This analysis will walk through the consequences of the Romney-endorsed Ryan budget for families struggling to access the American Dream. It will then show how Gov. Romney’s own tax and budget plans implicitly call for even deeper cuts to health care, nutrition aid, veterans’ services, education, and other fundamental supports for the middle class. Ultimately, it will show that Gov. Romney’s plan calls not for an attack on poverty but for an attack on the poor themselves.

The Romney-Ryan mind-meld

Shortly after Rep. Paul Ryan released his budget blueprint for fiscal year 2013, Gov. Romney endorsed it as a reflection of his own priorities, stating, “I’m very supportive of the Ryan budget plan. It’s a bold and exciting effort on his part and on the part of the Republicans, and it’s very much consistent with what I put out earlier.”

Endorsing the House budget aligns Gov. Romney with a set of priorities that will undercut economic security and opportunity for struggling families. Here are three key things to know about the Romney-Ryan plan and how it will affect families trying to make ends meet.

1. The Romney-Ryan plan’s Medicaid provisons strip 31 million people of their health care—predominantly seniors, low-income children, people with disabilities, and the working poor.

Both Gov. Romney and Rep. Ryan make repeal of Obamacare a central tenet of their budget plans. In fact, Gov. Romney has promised that if elected, on day one of his term he would begin the process to repeal the Affordable Care Act, both through undermining it with administrative actions and pursuing fullscale legislative repeal.

Following this course could compromise access to care for families such as Mari’s (see sidebar), who stand to benefit from Obamacare’s Medicaid expansion. In fact, up to 17 million people could lose pending access to Medicaid if Gov. Romney gets his way on repealing Obamacare, including home health aides, waitresses, child care providers, and food-service workers all of whom often earn too much to qualify for the current Medicaid program but too little to afford insurance on their own.

This move is an about-face from Gov. Romney’s time in office in Massachusetts, when he personally negotiated more federal funding for Medicaid as part of his health care plan, expanding the program to cover an additional 92,500 people. In fact, when campaigning for governor in September 2002, he asserted, “I want to see Massachusetts get its fair share of Medicaid dollars from the federal government.”

Today, candidate Romney rejects the very Medicaid funds that enabled then-Gov. Romney’s own health reform plan to be successful.

But Gov. Romney is not content with simply stopping more people from gaining health coverage under Obamacare. His plans include deep cuts to current Medicaid funding by converting the program into a block grant to the states that caps funding regardless of rising need or an increase in health care costs. Assuming that he follows the Medicaid proposal he endorsed in the Ryan budget, the consequences would be disastrous for some of our most vulnerable citizens. On top of the 17 million people who would lose pending access under Obamacare, more than 14 million more people would lose their Medicaid in the next 10 years, most of them joining the ranks of the uninsured.

Considering that children by far represent the largest group of Medicaid beneficiaries, accounting for about half of all enrollees, and that two out of every three Medicaid dollars go to providing care to people in nursing homes, victims of catastrophic accidents, and disabled children, these Medicaid cuts would deal a hard blow to some of our most vulnerable populations and their families.

And it’s not just low-income Americans who would be hit hard. People with severe disabilities that require benefits such as case management and mental health care would also be at risk of losing Medicaid’s comprehensive coverage for these types of services if they were shifted over to a private plan. Many seniors spend prolonged periods of time and large portions of their savings on home health care before ultimately entering a nursing home with very few financial resources. In fact, 70 percent of nursing home residents become Medicaid beneficiaries. If the Romney-Ryan plan were to go into effect, many of these seniors could be left without needed care, or spouses and families would face greater struggles to balance care for their loved ones with work and other care responsibilities.

Gov. Romney and Rep. Ryan paint Medicaid as an entitlement that fosters dependence. But in reality it is an opportunity program, ensuring that children have the health care they need to concentrate in school and become productive workers, or that families with a sick or disabled relative are able to stay in the workforce knowing that their loved one can access care. Similarly, Obamacare’s expansion of coverage to low- and moderate-income families—something that Gov. Romney has called for repealing—would provide families with the access to the health care they need to achieve greater economic security and opportunity.

2) The Romney-Ryan plan kicks 8 million to 10 million people off their nutrition assistance.

By endorsing Rep. Ryan’s budget blueprint, Gov. Romney has pledged to support a policy of kicking between 8 million and 10 million people off the Supplemental Nutrition Assistance Program—the backbone of our nation’s nutritional safety net—of setting the benefit so low that it wouldn’t even meet the Department of Agriculture’s definition of a bare-bones diet, or some combination of these two outcomes. The Ryan plan proposes $134 billion in cuts to nutrition assistance over 10 years, slashing a program that kept approximately 4 million Americans out of poverty in 2011.

The results would be particularly dramatic for households with children, seniors, or people with disabilities since nearly 75 percent of nutrition assistance program participants are in families with children, and more than 25 percent of participants are in households with seniors or people with disabilities. Three times as many program households have incomes from work as do from welfare, making nutrition assistance an important support for low-wage working families.

But Gov. Romney’s cuts to the Supplemental Nutrition Assistance Program wouldn’t only hurt low-income people. One of the program’s core strengths is that during tough economic times, it sustains consumer demand for food, keeping small businesses humming and creating jobs for other Americans. In fact, if the Romney-Ryan cuts were spread equally over 10 years, they would cost us 184,000 jobs in the first year alone.

These cuts will affect job creation in the short run and stymie economic growth in the long run. Hunger, particularly among children, is associated with lower educational outcomes, lower workforce productivity, and higher health care costs—consequences that affect middle-income families and businesses, as well struggling families. The Center for American Progress and Brandeis University have shown that hunger costs the United States $167.5 billion every year in lost economic growth. A spike in hunger would also be costly to state economies (see Florida sidebar), affecting businesses and middle-income families, as well as families struggling against hunger.

3) The Romney-Ryan plan will squeeze services that create greater economic opportunity and mobility for low-income children, veterans, and families scraping by in a tough economy.

The Ryan budget would cut annual federal spending by more than $350 billion, compared to President Barack Obama’s proposed budget.

If applied across the board, these cuts would translate into kicking 191,000 low-income children off Head Start, an early education program that helps at-risk preschoolers with the educational, health, nutrition, and family support services they need to thrive. The cuts would also reduce or eliminate educational services for more than 4 million students in low-income school districts, and shift the special education costs of 1.26 million children with special needs to states and districts in the first two years alone.

And it’s not just educational funding. Services that train low-income youth and veterans for jobs, give expectant mothers access to healthy and nutritious food, offer mental health counseling, and provide cooling assistance to vulnerable households struggling in this summer’s heat waves would all be subject to the deep cuts in this part of the budget.

One element of annual spending that both Gov. Romney and Rep. Ryan propose increasing is nonwar defense spending. Capping overall spending while boosting defense dollars will further squeeze the domestic investments that veterans rely on when they come home. A veteran, for example, lives in one in five households benefiting from the Low Income Home Energy Assistance Program, which provides heating and cooling assistance, and 1.2 million veterans used mental health services in 2010.

Gov. Romney’s tax and budget proposals: The Ryan budget on steroids?

Beyond endorsing the Ryan plan, Gov. Romney has offered few specifics on his plans to help “the very poor.” But while Gov. Romney has not outlined a specific plan to help low-income Americans, examining his tax and budget proposals yields key information about the cuts that would be necessary to low-income programs to finance his tax cuts for millionaires and increased defense spending.

And, unfortunately for struggling families, Gov. Romney’s plans for low-income families are even more radical than those in the Ryan budget.

The Center on Budget and Policy Priorities has examined a few core spending and tax principles outlined by Gov. Romney, including:

• Passing a balanced budget amendment that requires the federal budget to be balanced by 2022
• Cutting marginal tax rates by 20 percent, including for the wealthiest Americans (with the generous assumption that half of the cost of these tax cuts could be offset from broadening the tax base)
• Protecting Social Security from deep cuts
• Imposing a hard cap of 20 percent on all federal spending as a percentage of GDP (with 4 percent of GDP set aside for core defense spending)

In practical terms, these principles translate into radical and historic limits on the resources available to help move families into the middle class.

In fact, under these constraints, the Center on Budget and Policy Priorities estimates that all other spending would be cut by 29 percent in 2016 and by 59 percent in 2022. In human terms this means that:

• 13 million low-income people would lose access to the Supplemental Nutrition Assistance Program, benefits would be cut by more than $1,800 a year for a family of four, or some combination of the two
• Compensation payments for disabled veterans (which average less than $13,000 a year) would be cut by more than 25 percent
• Supplemental Security Income benefits for poor seniors and people with disabilities (which average less than the poverty line, at about $6,000 a year) would be cut by 25 percent
• Nondefense discretionary spending, which includes services such as education, job training, Head Start, affordable housing, nutritional assistance for pregnant women and infants, and veteran’s health, would be cut by $1.7 trillion over the next 10 years

Gov. Romney has endorsed the Ryan plan to cut and privatize Medicare and turn it into a voucher, while simultaneously criticizing reforms in the Affordable Care Act that cut waste in the Medicare program without undermining seniors’ guaranteed access to health care. But if Gov. Romney wanted to protect Medicare in addition to Social Security, under his own constraints he would have to practically eliminate every other safety net program, taking nearly $6 out of every $7 away from programs such as Head Start, job training, child care, and affordable housing.

Gov. Romney’s priorities: The rich come first

With all these cuts on the table for struggling families, you’d think Gov. Romney’s plan would ask the wealthiest Americans to sacrifice. But in fact, Gov. Romney’s plan offers $2.9 trillion in tax cuts to just the top 1 percent of earners, which works out to an average annual tax cut of $230,000 for those who have an average income of $1.25 million according to the nonpartisan Tax Policy Center.

In contrast, Gov. Romney is proposing cuts of about equal value to critical health and nutrition programs relied upon by millions low- and moderate-income families today.

Conclusion

After the media pressured Gov. Romney about his “not concerned about the very poor” remarks, he backtracked, stating, “My primary focus is on helping people get in the middle class and grow the middle class. That we have a safety net that cares for the poor, I want to keep that safety net strong and able. The wealthy are doing just fine.”

Less than two months later, he endorsed the Ryan budget, which asked low- and middle-income Americans to pick up the tab on an additional $3 trillion in tax cuts for the wealthiest American households.

In short, the real problem is not Gov. Romney’s penchant for gaffes, but his public policies, which will undermine access to the American Dream for millions of families.

Whether through endorsing the Ryan budget or setting out his own more radical budget and tax policies, Gov. Romney’s plan gives up on vulnerable families and further erodes the middle class while funneling more tax breaks to the 1 percent.

And by picking Rep. Ryan as his running mate, Gov. Romney has only further aligned himself with a radical budget plan that tilts our economy even more in favor of the wealthy at the expense of broad-based economic prosperity.

Melissa Boteach is the Director of the Poverty to Prosperity Program at the Center for American Progress Action Fund.

SOURCE: AP/ Cathleen Allison

Nevada Gov. Brian Sandoval, along with Utah Gov. Gary Herbert, have backtracked on their recent requests to the Obama administration for some leeway to make TANF more effective and efficient at combatting poverty.

The Republican presidential campaign of former Massachusetts Gov. Mitt Romney is knowingly misleading the American people about President Barack Obama “gutting welfare reform” in a series of TV ads that falsely say the president is eliminating the work requirement so that “they just hand you your check.” The lie earned the Romney attack ad a maximum Pinocchio status from all nonpartisan fact-checkers, yet Romney pollster Neil Newhouse acknowledges that whether or not the ad is true is immaterial because “we’re not going to let our campaign be dictated by fact-checkers.”

So what do the Republican governors of the states that asked for the opportunity to tinker with their state’s Temporary Assistance for Needy Families program think of this indirect attack on them? Well, Govs. Gary Herbert of Utah and Brian Sandoval of Nevada today are backtracking on their recent requests to the Obama administration for some leeway to make the income-assistance program more effective and efficient at combatting poverty through better employment outcomes, but their record of asking for some freedom to experiment at the state level speaks for itself.

In defending his request in August, Gov. Herbert in July said, “Utah’s request for a waiver stems from a desire for increased customization of the program to maximize employment among Utah’s welfare recipients.” This is in line with a strong bipartisan tradition of states as laboratories of democracy to test out new ideas.

For his part, Gov. Sandoval’s spokeswoman said that he never requested a waiver. The spokeswoman says the governor only requested to “explore the possibilities.” This is a distinction without a difference. Nevada’s Health and Human Services director, Michael Willden told the Obama administration in August 2011:

Nevada is very interested in working with your staff to explore program waivers that have the potential to encourage more cooperative relationships among the state agencies engaged in economic stimulus through job creation, employment skill attainment and gainful employment activities. Nevada is also interested in exploring performance measures that endure program accountability and also increase the probability of families becoming self-sufficient by providing meaningful data as to the services or combination of services with best outcomes.

There’s no reason for these governors to be backtracking except the bind that the Romney campaign’s false ads have put them in. The waivers are patently not about “taking the work out of welfare,” but it is clearly part of the bipartisan tradition of letting states be the laboratories for policy reform—as even Gov. Mitt Romney argued back in 2005. As governor of Massachusetts, he asked for “increased waiver authority, allowable work activities, availability of partial work credit and the ability to coordinate state programs are all important aspects of moving recipients from welfare to work.”

Why would Republican governors ask for this kind of waiver authority? Because they and several Democratic governors recognized some problems with the Temporary Assistance for Needy Families program in their states that get in the way of what progressives and conservatives agree on—work as a strategy to give low-income Americans struggling to rise out of poverty a hand up into the middle class.

There are several big problems with the structure of the work-participation rate as the main metric for gauging a state’s success in moving poor families on their caseload from welfare to work. Under federal rules the federal government provides a flexible block grant to the states, which in turn are required to engage families on their caseload in work- and job-preparation activities for 30 hours a week. At least 50 percent of a state’s work-eligible caseload must meet this threshold if a state wants to receive their full grant from the federal government and avoid penalties. Sounds reasonable.

But a closer look reveals some major problems with the metric as a way to gauge whether or not vulnerable families are actually moving closer to sustainable employment, which is a goal both parties can agree on. Here are just a few good reasons those Republican governors and their Democratic colleagues might have asked for waivers to improve the strategies and metrics to connect more families relying on temporary income assistance to sustainable employment.

Many states were understandably unable to meet their work-participation rate targets during the Great Recession because jobs were scarce

This problem raised the ire of many members of Congress, who cannot for the life of them understand why states would be having trouble placing people in jobs or work-related activities when there are no jobs to be had. Even as our economy slowly recovers, the unemployment rate for people without a high-school diploma—a proxy for low-skilled workers that typically characterize those Americans seeking temporary income assistance—has been three to four times the rate of workers with a college degree.

One possible explanation for this phenomenon is that during the recession, employment losses were most heavily concentrated in mid-wage occupations, but the employment growth in the recovery has been skewed toward lower-wage occupations, say researchers at the National Employment Law Project. In a weak labor market, given the choice between lower and middle skill workers for low-wage jobs, employers may be more likely to hire workers with the higher skill set, thus displacing workers who would hold those types of jobs in a better economy.

“Work” is defined so narrowly in federal law that states often dissuade low-income Americans in need of work from activities that could help in the long term

At a time when jobs are scarce, it would make sense for states to help out-of-work, low-income Americans access education and training to increase their employability or to address long-term barriers to work such as substance abuse or mental health issues. Unfortunately, states are often dissuaded from helping these types of workers in these ways because there are limits in how states can count these activities toward their work-participation rates.

This causes states to seek to reduce their temporary income assistance caseload to meet their work-participation rate requirements—even it means not helping someone become truly gainfully employed. It also discourages many workers on income assistance from seeking education and training that could help them access better jobs in the long-term.

The work-participation rate doesn’t address the multiple barriers to work faced by the breadwinners of many poor families

Many breadwinners of poor families are not able to work for 30 hours a week or more for very practical reasons. A 2010 survey of poor adults with children (not all of whom are recipients of temporary income assistance) indicated that of those with employment challenges, 35 percent had home or family reasons including a sick child or parent or disruptions in child care that prevent them from working temporarily or sometime permanently, as my colleague Joy Moses notes in Chapter Three of our report “Restoring Shared Prosperity: Strategies to Cut Poverty and Expand Economic Growth.”

Stringent work-participation rates under federal law encourage states to “cream” the easiest-to-employ individuals rather than deal with the barriers facing the most vulnerable workers by taking steps such as expanding child-care assistance or helping a family access the needed support to deal with a personal crisis. The goal of moving people from welfare to work is critical, but work-participation rates alone are sometimes a poor metric for tracking actual progress on this front.

The bottom line for Republican and Democratic governors seeking waivers

The current federal incentive structure for helping low-income breadwinners turn from temporary income assistance to sustainable employment often encourages states to ignore the complicated realities of some of these workers and their families; discounts valuable efforts to help these breadwinners find jobs through education, training, or job search activities; and forces the states to stick to a rigid work-participation rate even amid deep recessions. In requesting waivers from the work-participation rates, Republican and Democratic governors alike—including the former governor of Massachusetts who is now running deeply misleading attack ads on just this issue—have simply asked for room to experiment without jettisoning the centrality of work in the welfare reform law.

In granting the waiver authority, President Obama was responding to bipartisan consensus that we need to think about measuring progress in ways that are more reflective of poor families’ employment outcomes when they are forced to turn to temporary income assistance. The Obama administration’s policy is to strengthen work requirements, giving states more space to innovate with approaches that move a higher share of workers in need of temporary income assistance into sustainable employment. That sounds like the opposite of “gutting welfare reform,” doesn’t it?

Melissa Boteach is Director of the Poverty and Prosperity program at the Center for American Progress Action Fund.

SOURCE: AP/J Pat Carter

An unidentified man, who lost his job two months ago after being hurt on the job, works a Miami street corner to collect money for his family on September 16, 2010. The man said his unemployment check did not cover costs of living.

For more facts on Gov. Romney’s plans for America, a Center for American Progress Action Fund series entitled “Romney University,” click here.

Download this issue brief (pdf)

Presumptive Republican presidential nominee and former Massachusetts Gov. Mitt Romney made headlines earlier this year by stating, “I’m not concerned about the very poor. We have a safety net there. If it needs repair, I’ll fix it.”

But since that time, he’s been close-lipped about his actual plans to help struggling Americans and to repair the safety net.

We can infer some of his proposals by his support for the House Republican budget plan introduced this spring by Rep. Paul Ryan (R-WI), as well as his own broad tax and budget plans. By endorsing the House Republican budget, for example, Gov. Romney has aligned himself with an agenda that will:

• Cause 31 million people—predominantly children, seniors, people with disabilities, and the working poor—to lose access to health insurance through Medicaid cuts over the next 10 years
• Kick 8 million to 10 million people off of the Supplemental Nutrition Assistance Program; set nutrition aid (currently averaging $1.50 per person per meal) below what the Department of Agriculture considers minimally adequate; or some combination of these two outcomes over the next 10 years
• Kick 191,000 children off of Head Start—a federally funded child development program for children in low-income families—in the next two years

Gov. Romney’s jobs plan also reflects traditional conservative solutions that have failed to spur employment growth in the past: cutting taxes for the wealthiest Americans, undermining unions, slashing spending, and rolling back regulations that protect workers and the environment.

But Gov. Romney has not been pressed on policies to connect low-income and long-term unemployed workers to job opportunities or on how he plans to improve job quality for the millions of Americans who have seen their wages flatten or decline, their benefits disappear, and their ability to balance work and family consistently undermined by rigid workplace rules.

Here are 10 questions for Gov. Romney on taxes, spending, and jobs that would help clarify his positions on important issues for Americans aiming to join the middle class.

Taxes and spending

1. Does he support tax fairness? We know Gov. Romney’s tax plan would funnel additional tax cuts to millionaires through lower marginal rates, which he claims would be offset in part by “broadening the base.” He has been silent, however, on how he would accomplish this “base broadening” and how it would affect tax credits that help make work pay for low-wage working families, including the earned income tax credit and refundable child tax credit. Does Gov. Romney support the earned income tax credit and child tax credit? Does he support the expansions made to these credits since 2009 that have kept an additional 1.6 million people in working families out of poverty? Would cuts to these programs be on the table as a way to pay for his tax cuts for wealthy households?

2. Does he want to cut Head Start? Gov. Romney’s proposed federal spending cap of 20 percent of GDP would certainly yield deep cuts to programs in the discretionary part of the budget, which houses most human-needs and opportunity programs for struggling households. But he has failed to name which programs he would cut to meet this target. Does he agree with cutting Head Start? Nutrition assistance through the Special Supplemental Nutrition Program for Women, Infants and Children? Child care? Which programs would he eliminate, and which would he protect?

3. Does he support federalism and flexibility for state governments on social safety net programs? Congressional Republicans have proposed eliminating categorical eligibility in the Supplemental Nutrition Assistance Program. This policy gives states greater flexibility to coordinate supplemental nutrition assistance with other programs such as free and reduced school lunches, and to allow poor families receiving nutrition aid to set aside a small amount of savings to avoid sliding back into poverty.

Gov. Romney has come out in favor of greater flexibility for states when it comes to block-granting and cutting programs such as the Supplemental Nutrition Assistance Program and Medicaid. Does he support continuing the categorical eligibility policy of allowing states greater flexibility in administering their supplemental nutrition assistance?

4. Should children, seniors, or people with disabilities be cut from Medicaid? While he was governor of Massachusetts, Mitt Romney personally negotiated for more Medicaid funding from the federal government to make his state health reform plan work. As a presidential candidate, however, he has proposed to block-grant Medicaid, which would result in more than $800 billion in cuts over the next 10 years, shifting more costs to states at a time when state budgets are already squeezed. These cuts would primarily fall on:

• Poor children, who account for nearly half of Medicaid enrollment but only about 20 percent of current Medicaid costs
• People with disabilities, who account for 16 percent of enrollment but about 45 percent of costs
• Seniors, who account for 9 percent of enrollment but 21 percent of costs

Putting himself in the shoes of a governor with less Medicaid funding, under a Romney administration how does Gov. Romney propose these cuts go into effect—who should lose their Medicaid, or what benefits should be cut from these populations? What guidelines would he provide as president? How would his health care plan in Massachusetts work if he hadn’t negotiated for more Medicaid funding from the federal government? What about the faith-based institutions that rely on Medicaid to provide care, particularly nursing homes? How will faith communities pick up the slack from government retrenchment if their main source of funding—Medicaid—is cut?

5. Does he want to cut programs for kids? Earlier this year the House approved a reconciliation bill per the instructions of the Gov. Romney-endorsed Ryan budget. The bill made cuts to “lower-priority” programs to avert automatic across-the-board cuts scheduled for January 2013 as a result of last summer’s debt deal. The impact of these cuts on children is detailed in the following infographic released earlier this year by the Center for American Progress:

Does Gov. Romney support these cuts?

Good jobs

6. Does he favor raising the minimum wage?As recently as January, Gov. Romney has come out in favor of raising the minimum wage by indexing it to inflation, but he recanted two months later, saying that he didn’t think it was a good time to raise the minimum wage, which would stand at $10.55 an hour if it had been indexed to inflation in 1968. Does Gov. Romney support increasing the minimum wage and allowing it to rise with inflation or another index? And if now is not a good time to raise the minimum wage, what would be the conditions under which Gov. Romney could support such an increase?

7. Does he support a work-family balance? Women are now half of all workers on U.S. payrolls and are either breadwinners or co-breadwinners in nearly two-thirds of all families. Yet the United States also faces high rates of work-family conflict with few laws to support working families. In fact, the United States is the only industrialized nation that has no federal policy supporting paid maternity leave. If elected, would Gov. Romney support efforts to encourage earned paid parental leave?

8. Does he want workers to have paid sick days? Forty percent of private-sector workers and 80 percent of low-wage workers do not have a single paid sick day to recover from a short-term illness or to provide care for their loved ones. Paid sick days legislation would enable workers to accrue paid sick leave and would include provisions to help employers manage. It also makes economic sense, as it costs businesses more in lost worker productivity to have sick employees come in than it would cost to offer paid time off in the first place. Does Gov. Romney support paid sick days legislation?

9. Does he support subsidized employment?As part of the American Recovery and Reinvestment Act of 2009, states were given funding to create subsidized jobs programs that moved many low-income Americans from welfare to work. In fact, Democratic and Republican governors alike praised the program, which allowed nearly 40 states to create more than 260,000 job opportunities for low-income and long-term unemployed workers by partnering with small business and the nonprofit sector. Unfortunately the bipartisan program was allowed to expire in September 2010. Would Gov. Romney support state efforts to create subsidized jobs programs through federal incentives?

10. Does he support extending unemployment insurance? Emergency unemployment compensation for workers out of a job for more than six months is set to expire at the end of the year, which means that workers laid off after July 1, 2012, would be cut off around Christmas without additional help if they have yet to find a job. Currently, more than 40 percent of unemployed workers have been out of job for six months or longer, and federal benefits have never been allowed to expire while the unemployment rate was more than 7.2 percent Moreover, unemployment insurance benefits have helped sustain 1.6 million jobs per quarter from mid-2008 to mid-2010 by increasing demand in the economy. Would a President Romney sign an extension of federal unemployment benefits into law?

Conclusion

After the media pressured Gov. Romney about his “not concerned about the very poor”remarks, he backtracked, stating:

My focus, my primary focus, is on helping people get in the middle class and grow the middle class. That we have a safety net that cares for the poor, I want to keep that safety net strong and able. The wealthy are doing just fine.

The media now has a unique opportunity to urge Gov. Romney to get specific about his actual plans to strengthen the safety net and how he intends to provide a pathway into the middle class. The aforementioned questions could serve as a guide to urge him to clarify how his tax, spending, and jobs plans will actually affect the low- and middle-income families he insists are his “primary focus.”

Melissa Boteach is the Director of the Poverty and Prosperity Program at the Center for American Progress Action Fund.

Download this issue brief (pdf)

For more facts on Gov. Romney’s plans for America, a Center for American Progress Action Fund series entitled “Romney University,” click here.

SOURCE: AP/ Manuel Balce Ceneta

The House GOP presents their FY 2013 budget, which guts federal programs supporting women and children.

House Republicans have made it clear that they aren’t finished with their war on women. In fact, they’ve just taken their crusade to a new level: attacking women’s economic security.

The House-passed Republican budget targets poor women and their families at every juncture of their life cycle, from crib to rocking chair. It guts programs that help low-income children get the nutrition and educational opportunities they need to develop and thrive. It makes devastating cuts to the Supplemental Nutrition Assistance Program (formerly food stamps), or SNAP, which primarily helps women, children, the disabled, and the elderly put food on the table, while also boosting our economy. The House budget’s cuts to Medicaid would deal a tough blow to low-income and middle-class women and families supporting elderly loved ones in nursing homes and those who rely on Medicaid for often life-saving preventive health services.

Instead of “empower[ing] individuals with greater control over their futures” as it claims, this budget does just the opposite. By choking off opportunity for women and children of all ages, the budget leaves poor women to fend for themselves and puts the American Dream further out of reach. What’s more, these cuts are being made in order to finance more tax breaks for those who need them the least.

The table below illustrates the House Republicans’ war on women’s economic security at all stages of life:

*The $3.3 trillion figure also includes $463 billion in cuts to low-income mandatory programs other than SNAP and Medicaid.

Katie Wright is a Research Associate for the Half in Ten Campaign at the Center for American Progress Action Fund.

SOURCE: AP/Jacquelyn Martin

House Budget Committee Chairman Rep. Paul Ryan (R-WI) speaks about his budget plan during a news conference on Capitol Hill in March 2012.

The latest House Republican budget plan asks low-income and middle-class Americans to shoulder the entire burden of deficit reduction while simultaneously delivering massive tax breaks to the richest 1 percent and preserving huge giveaways to Big Oil. It’s a recipe for repeating the mistakes of the Bush administration, during which middle-class incomes stagnated and only the privileged few enjoyed enormous gains.

Each component of the new House Republican budget threatens the middle class while doing nothing to add jobs or grow our economy. It ends the guarantee of decent insurance for senior citizens, breaking Medicare’s bedrock promise. It slashes investments in education, infrastructure, and basic research, all of which are key drivers of economic growth and mobility. And it cuts taxes for those at the top, asking the middle class to pick up the tab. It’s a budget designed to benefit the top 1 percent at everyone else’s expense.

This article contains a correction.

The House Republican budget released today by Budget Committee Chairman Paul Ryan (R-WI) purports to boost economic growth by cutting taxes and government spending. Don’t be fooled by the rhetoric. Pull back the curtain.

When you do you’ll see a budget that will increase child hunger and cost jobs by cutting off critical nutrition assistance. You’ll see a blueprint that undermines family economic security by reducing access to health care and support for those providing for elderly loved ones. You’ll see a fiscal framework that insists on keeping elevated levels of nonwar defense spending at the expense of caring for our veterans who are returning home. And you’ll see class warfare—a budget that enriches the wealthiest individuals and corporations with wasteful tax breaks at the expense of the middle class and most vulnerable.

Here are the five most egregious proposals that Rep. Ryan and the House leadership do not want you to know about their new budget proposal for fiscal year 2013, which starts in October:

• Billions of meals would be missed by struggling families amid deep job losses in food-related industries*
• Middle-class economic security would be shredded by putting care for the elderly, the disabled, and children at risk
• Millionaires and corporations would get a free ride at the expense of middle- and low-income families
• Nonwar defense spending would continue at the expense of caring for our veterans returning home to their families
• Programs to help struggling families get back on their feet would be further squeezed

The American people should recognize the consequences of enacting the House budget plan in the coming fiscal year for what they are—a bare-knuckled effort to tilt our economy even further in favor of the wealthy at the expense of broad-based economic prosperity. Here are the details about the five most savage steps taken in the House budget.

Billions of meals would be missed by struggling families amid deep job losses in food-related industries*

The House budget proposes to give states “more flexibility” in how they administer the Supplemental Nutrition Assistance Program, or SNAP, which ensures millions of Americans do not go hungry. What this really means is deep cuts to this effective and efficient program, which would inhibit its ability to respond during times of recession and would likely mean cuts to eligibility and benefits.

Under the House budget proposal, millions of people could be kicked off the nutrition assistance that stands between them and hunger, or could see their benefit set so low that it would be difficult to afford three meals a day. Considering that 76 percent of SNAP households included a child, elderly person, or disabled person, and three times as many SNAP households have income from work rather than welfare, Rep. Ryan’s proposed “work requirements” for the program make little sense.

Cuts to supplemental nutrition assistance hurt more than struggling families. Small businesses, including grocers and retailers who benefit from community members using these benefits to buy food for their families, would feel the hit as they see fewer customers coming through their doors. In fact, the House Republican budget would cut $133.5 billion from SNAP over 10 years. If divided evenly over 10 years, an annual $13.4 billion cut would result in as many as 8.2 billion meals lost and 184,000 jobs lost in just one year.

Middle-class economic security would be shredded by putting care for the elderly, the disabled, and children at risk

The House budget proposes to give “states the ability to offer their Medicaid beneficiaries more options and better access to care.” Perhaps unsurprisingly, what this really means is deep cuts to Medicaid that would shift costs to states and fundamentally transform the ability of the program to meet the health care needs of poor, elderly, and disabled Americans. Cash-strapped states would be put between a rock and a hard place as they would be forced to cut benefits, reduce eligibility, or raise taxes—and in some cases they’d need to do all three.

With two out of every three Medicaid dollars going to provide care to people in nursing homes, victims of catastrophic accidents, and disabled children, cuts to Medicaid would hit these people and their families hard. Many seniors spend prolonged periods of time and much of their savings on home health care prior to entering a nursing home with few financial resources. As 70 percent of nursing home residents become Medicaid beneficiaries, seniors and their spouses could be left to fend for themselves at a time when they should be enjoying the retirement they’ve spent a lifetime earning.

Millionaires and corporations would get a free ride at the expense of middle- and low-income families

In order to “promote economic growth,” the House budget lowers tax rates on the wealthiest individuals and corporations to the tune of $3 trillion and makes the Bush-era tax cuts permanent. Yet the nonpartisan Congressional Budget Office has shown that extending the Bush tax cuts for the wealthy is one of the least effective ways to stimulate economic growth.

To put these large and costly tax cuts in perspective, consider this: For the additional $3 trillion in tax cuts proposed by the House budget, we could prevent all the cuts that Rep. Ryan suggests to nutrition assistance, Medicaid, and other domestic investments for children, veterans, and struggling families—and still make a dent in our deficit. But because of these enormous tax cuts for the wealthy and for corporations, the House plan still fails to produce significant real deficit reduction—one of their stated priorities.

Nonwar defense spending would continue at the expense of caring for our veterans returning home to their families

This House budget attacks safety net programs that are helping struggling veterans get back on their feet while maintaining unnecessarily high levels of nonwar defense spending. The House budget’s cuts in supplemental nutrition assistance, for example, could affect veterans and military families since $31 million of this funding in 2008—the last year for which complete data are available—was spent at military commissaries to help feed military members and their families who struggle against hunger.

By setting the cap on overall federal annual spending even lower than the bipartisan level passed in the Budget Control Act of 2011, the House budget will squeeze domestic safety net programs that serve veterans and nonveterans alike. A veteran, for example, lives in one in five households benefiting from the Low Income Home Energy Assistance Program, which provides heating and cooling assistance, and 1.2 million veterans used mental health services in 2010.

Yet the proposed House budget leaves the nonwar defense budget untouched—even with $70 billion in cost overruns caused by management failures in the Department of Defense military contracts from the past two years alone. Without undermining our national security, we can reduce the unprecedented level of baseline defense spending and invest in growing our middle class. But the House budget does the opposite, disinvesting from programs that provide stability and opportunity to veterans while maintaining wasteful defense spending.

Programs to help struggling families get back on their feet would be further squeezed

The House budget would cut annual federal spending by more than $350 billion, as compared to President Barack Obama’s proposed budget, while offering more than 10 times this amount in tax cuts for the wealthy and corporations. Many of the human-needs programs that help educate and train low-income youth for jobs, provide critical development and education assistance to preschoolers, and give expectant mothers access to healthy, nutritious food, are contained in this part of the budget. Programs such as YouthBuild, Head Start, and WIC, or Women Infants and Children, have forever changed the lives of people such as Maurice, Melissa, and Emily by helping them get back on their feet and, in turn, positioning them to give back to their families and communities.

Cuts of this magnitude to this area of the budget would devastate millions of families who are still coping with unemployment, foreclosure, and cutbacks to paychecks and hours. By weakening the safety net even further, it ups the ante for families who are teetering above the poverty line. Hopefully they won’t fall, as there won’t be much there to catch them under the new House Republican budget plan.

Conclusion

We know poverty reduction and deficit reduction are not mutually exclusive goals. We know that helping low-income families access the support they need when they fall on hard times is not only the right thing to do but also good for our economic growth and our national well-being. And we know that every bipartisan deficit-reduction agreement before this Congress protected low-income families and in many cases actually cut poverty and the deficit simultaneously. This budget is wildly out of step with that previous commitment.

When you look beyond the rhetoric, you see a House budget that gives up on vulnerable families and further erodes the middle-class while funneling more tax breaks to the 1 percent. It is high time we learn a lesson from our past—we’re strongest when we invest in programs and policies that fight poverty, reduce inequality, create jobs, and expand economic opportunity to all.

Melissa Boteach is the Director of the Half in Ten Campaign at the Center for American Progress Action Fund. Katie Wright is a Research Associate with the Half in Ten Campaign at the Center for American Progress Action Fund.

See also:

• The 6 Key Failures of the House Republican Budget Plan by Michael Linden
• New Ryan Plan Is Austerity on Steroids by Heather Boushey
• Latest House Republican Budget Threatens Medicare and Shreds the Safety Net by Topher Spiro

*Correction, March 23, 2012: This article originally stated that trillions of meals would be missed by struggling families, but the number is actually in the billions. It also calculated the number of jobs lost and meals put at risk for low-income families as a result of cuts to the Supplemental Nutrition Assistance Program, but due to errors in data, this information is currently being recalculated.

SOURCE: AP/Susan Walsh

President Obama speaks about his budget at Northern Virginia Community College in Annandale on February 13, 2012. The budget inclues several programs that will help the poor and build the middle class.

President Barack Obama’s proposed budget for fiscal year 2013 sets a responsible course for rebuilding the economy so that it works for everyone, not just the privileged few. Our middle class is the engine of economic growth, but is threatened by dwindling public investments, a tax system increasingly rigged to benefit the wealthy, a fraying safety net, and assaults on what should be the bedrock guarantees of Medicare, Medicaid, and Social Security.

The president’s budget protects those guarantees, boosts critical investments, and takes steps toward rebalancing the tax code so that all pay their fair share. And it does this in a fiscally responsible way, charting a path that nurtures the economic recovery while reducing the federal deficit, all without asking the middle class to shoulder a disproportionate share of the burden.

President Obama’s budget blueprint released today illustrates that fighting poverty and taming the deficit can be achieved together. The administration’s proposal lays out critical investments that will help more struggling Americans join the middle class and encourage shared economic growth. These strategies not only cut poverty; they are in fact central in putting us on stronger fiscal footing in the long run.

Half in Ten, a project of the Center for American Progress Action Fund, The Leadership Conference on Civil and Human Rights, and the Coalition on Human Needs, believes that to cut U.S. poverty in half in 10 years, we must enact policies to create good jobs, strengthen families, and promote economic security. The president’s budget makes significant strides in all of these areas but it also includes a number of damaging cuts that could be harmful for our nation’s most vulnerable citizens.

The analysis below provides background on key elements of the president’s budget that relate to Half in Ten’s goal of cutting poverty in half.

Good jobs

The president’s budget includes critical investments to create good jobs, prepare and train workers for growing industries, and improve job quality for all workers.

For starters, in the immediate term the president proposes continuing the payroll tax cut and unemployment insurance, which create customers for American goods and services and keep small businesses humming.

The blueprint also contains promising job-creation strategies such as connecting low-income and long-term unemployed workers to summer and year-round subsidized jobs and work-based training opportunities. It keeps teachers, firefighters, and police officers on the job, and helps workers in distressed communities find employment meeting needs in their own neighborhoods. And the proposed investments in building and repairing roads, bridges, transit, broadband networks, and schools will put people to work in the short term and lay the groundwork for stronger economic growth in the long term.

The budget further includes critical investments in education and worker training to help prepare workers to fill the jobs of the future. The president’s budget includes a $30 million increase in cradle-to-college investments such as “Promise Neighborhoods” that build networks of support to help students in high-poverty neighborhoods succeed. In the context of tight budget caps, the budget finds room for further investments in Head Start and child care, providing low-income children with critical early-learning building blocks.

In addition, the proposal takes steps to keep college affordable and to prepare American workers to fill good jobs. The budget maintains the maximum Pell Grant, creates new work-study opportunities, and makes permanent the American Opportunity Tax Credit, which helps more than 9 million families afford college. It also increases funding for proven programs such as YouthBuild that help low-income youth finish high school and get job training, and provides for interagency approaches to better serve other at-risk youth who are neither in school nor in the workforce.

Finally, the president’s budget takes steps to improve job quality for low-income workers. It provides a $5 million State Paid Leave Fund to support states that want to offer paid-leave programs—a step that could ultimately lead to greater flexibility for low-wage workers who are often forced to choose between their job and caring for a sick kid. It also funds enforcement mechanisms to ensure workers are not misclassified as “independent contractors,” which robs them of the pay and benefits they’re entitled to.

Strong families

The president’s blueprint recognizes the key role that strong families play in creating greater opportunity for children, and to that end it provides funding to help support better outcomes for families.

The budget recommends funding to help children in the child welfare system with a goal of reducing abuse and neglect. It also supports evidence-based policies to reduce the instance of teen and unplanned pregnancies, and sustains efforts to combat violence against women and to assist victims of domestic violence.

The budget also continues the president’s commitment to promoting fatherhood. The proposal includes funding to incent states to modernize and strengthen their child support programs and to provide access and visitation services, policies that encourage fathers to take financial responsibility for their children as well as the opportunity to provide emotional support.

Finally, the budget maintains investments in community health centers to help families access primary and preventive care regardless of their income, and provides sufficient funding to open up new health centers in underserved communities. And continued funding to implement the Affordable Care Act will help millions more uninsured or underinsured families access the care they need, promoting healthy children and more stable families.

Economic security

Last but not least, the president’s budget recognizes that work supports and a strong safety net are key pillars of a strategy to help struggling Americans who fall on hard times and to provide a ladder to the middle class. To that end, his budget makes key investments in policies and programs to promote economic security and opportunity by:

• Permanently extending expansions of the Child Tax Credit and the Earned Income Tax Credit that were passed in the Recovery Act, which will boost the incomes of millions of low-wage working families with children
• Combating hunger by providing full funding for the nutritional safety net that has been responding to high levels of unemployment and by continuing investments in programs that ensure children have the nutritional building blocks they need to thrive
• Providing funding to make progress on the administration’s strategic plan to end homelessness
• Preserving existing housing vouchers that help low-income families afford rent
• Creating new housing opportunities for veterans
• Proposing financing for the development and preservation of affordable housing through the Housing Trust Fund

Cuts to the safety net

The president’s budget is not perfect, however. The package cuts and consolidates a number of important programs that serve and strengthen low-income families, which could further squeeze families already struggling to make ends meet.

For instance, the president proposes cutting more than $300 million from the Community Services Block Grant, a program that helps community action agencies in more than 1,000 localities throughout the country to provide services such as weatherization, job training, and Head Start to more than 20 million Americans.

And while the president proposes more funding than he did last year for low-income home energy assistance or LIHEAP, his blueprint would represent more than $450 million in cuts from last year’s enacted level—a hit to vulnerable households struggling to afford heating and cooling.

Cuts to affordable housing programs will also hit low-income families especially hard. The administration’s proposal requires struggling households to pay a $75 minimum rent, which would hit the lowest-income families who are already exempt from normal rents charged to Department of Housing and Urban Development recipients. These changes, coupled with small cuts to housing for people with AIDS and people with disabilities, could translate into real hardship for families on the brink of homelessness.

The right priorities

But despite these cuts, the president’s budget underscores that you can make strategic investments to rebuild the middle class even in the context of fiscal austerity. By asking the wealthiest to pay their fair share, cutting special-interest tax loopholes, and eliminating wasteful military spending, the president’s budget cuts our deficit by more than $4.3 trillion, while preserving critical investments that build our middle class and pursue additional opportunities to cut poverty.

While Half in Ten holds some concerns about cuts to the safety net, we think that overall the president’s budget underscores that poverty reduction and deficit reduction can be accomplished simultaneously.

See also:

• Obama’s Sensible Budget Priorities by Michael Linden
• Turning to Community Colleges for Middle-Class Careers by Stephen Steigleder
• President Obama’s Oil Change: Cut Tax Breaks, Invest in Jobs by Daniel J. Weiss
• Obama Steps Up for Communities of Color by Daniella Leger
• President Obama’s Budget Proposal and Bowles-Simpson by Michael Linden
• Continued Investment in Elementary and Secondary Education by Glenda Partee and Diana Epstein
• The Fiscal Year 2013 Defense Budget: A Report Card by Lawrence J. Korb, Alex Rothman, and Max Hoffman

These are the prayers of nearly 50 million Americans living below the poverty line—as well as the tens of millions more lower-income Americans struggling to stay in the middle class.

Read more here.

SOURCE: AP/Susan Walsh

House Speaker John Boehner (R-OH), surrounded by his colleagues, speaks during a news conference on Capitol Hill in December 2011. The House of Representatives will vote this week on a bill banning any government aid distributed through the Temporary Assistance for Needy Families program from being used at strip clubs, casinos and liquor stores.

This week the House of Representatives will be devoting its time to voting on a bill that would ban any government aid distributed through the Temporary Assistance for Needy Families program from being used at strip clubs, casinos, and liquor stores. It will likely pass.

This begs the question: With unemployment at 8.5 percent and more than one in three Americans struggling to get by on low incomes, do conservatives really believe that taxpayer dollars used for strip clubs, liquor stores, or casinos is a pressing national crisis? For most House conservatives, the answer is probably no. Do they see the political value of forcing such a vote in an election year? You bet!

Putting politics above policy in this crass way is unfortunate and cynical. The Temporary Assistance for Needy Families, or TANF, program has experienced benefit cuts of more than 20 percent, after adjusting for inflation, even as the Great Recession and the slow economic recovery have caused elevated levels of unemployment and poverty. Many low-income workers on TANF are unable to access the child care they need to make work possible and ultimately end up spending nearly half their income on care for their children. Low-wage workers are constantly facing the threat of a layoff because more than 80 percent lack access to a single paid sick day to take care of themselves, a sick kid, or an elderly relative.

And the big vote on TANF is about strip clubs?

This vote represents yet another instance in the creeping trend of conservatives to demonize the poor—and then threaten anyone who votes against the legislation with supporting “welfare spending” for strip club admissions. The tactic enables conservatives to imply that tough economic circumstances somehow make poor people delinquent and criminally inclined. Take, for example, the House proposal to stigmatize the unemployed by mandating drug testing for unemployment insurance applicants, even though most states already have policies in place to deny these benefits to anyone who is fired for using drugs on the job. Never mind that people on assistance have been found to test positive for drug use at no higher rate than the average population.

What’s more, these policies will cost taxpayers a lot of money. Numerous studies show that it doesn’t pay for the federal or state governments to drug test people, and in one instance a congressional committee estimated it cost $77,000 to catch one drug user because the positive test rate was only 0.5 percent. Using this number as an example, with unemployment benefits averaging only $300 a week, the federal government could provide 10 jobless workers with six months of benefits for the cost of possibly catching one drug user. So much for conservatives’ concerns about wasting taxpayer money.

Indeed, at the heart of these proposals is not a concerted effort to improve program integrity and efficiency or to save taxpayer dollars. TANF, like other government programs, is already subjected to federal and state audits. If program integrity were the goal, then conservatives would also be calling for votes forbidding corporations that receive taxpayer subsidies and bailouts from having big conferences in Las Vegas, where there is no shortage of casinos, strip clubs, and liquor stores. They would be up in arms about the possibility of wasting taxpayer dollars on drug testing when studies show that the costs far outweigh the benefits.

Rather, these proposals are crass political tactics to divide our nation by peddling the notion that the poor are somehow different from everyone else. They imply that because someone needs unemployment benefits, they must have done something wrong to be laid off. Or that because someone needs temporary welfare benefits, they will spend money on liquor, not their children.

We should expose these tactics for what they are by highlighting what’s really going on in America today among the poor and middle class. A recent study revealed that half of Americans are one crisis—one lost job, one illness, one broken-down car—away from poverty. Nor are the poor a stagnant group of people. Between 2004 and 2007, for example, only 2.2 percent of the U.S. population was under the poverty line for the full four years, while approximately one-third of the population fell into poverty for at least two months. The line between the middle class and the poor is not as impenetrable as some might like to think.

Rather than focusing valuable congressional floor time to debating TANF benefits at strip clubs, the House leadership should dedicate more time to putting Americans back to work and rebuilding our middle class. Measures such as these are an insult to the millions of unemployed Americans who want nothing more than to get a job or who seek temporary assistance to help their families get back on their feet at times of crisis.

Melissa Boteach is the manager of the Half in Ten project at the Center for American Progress Action Fund.

SOURCE: AP/ Manuel Balce Ceneta

With his tax and budget plans, Mitt Romney would harm poor and middle-class Americans alike in order to give the wealthy an even larger slice of the pie.

Former Massachusetts Gov. Mitt Romney constantly accuses President Barack Obama of fomenting “class warfare” and stoking “envy” among the have-nots for the wealth of the “haves.” Without a doubt, class warfare is afoot in our nation, but it is Romney’s own tax and budget plans that will further divide our nation because of his assault on poor and middle-class Americans alike.

Mitt Romney’s tax and budget plans would undermine the ability of millions of struggling Americans to meet the basic need of securing affordable health care. This assault on the 99 percent comes in at the exact same cost as his offer of additional tax cuts to the wealthiest 1 percent of Americans.

Here’s the math:

These proposals will hurt the 99 percent overall but will strike communities of color the most, in part because they were hardest hit by the Great Recession of 2007–2009 and the still-lingering housing crisis. Romney’s plan, for example, offers $2.24 trillion in tax cuts to the top 1 percent of earners. This works out to an average tax cut of $165,000 for those who already have an average income of $1.25 million, according to the nonpartisan Tax Policy Center.

In contrast, Romney is proposing cuts of about equal value to critical federal government programs offering affordable health care coverage to low- and moderate-income families today. Romney plans to send federal funding for Medicaid “back to the states” as a block grant—a ploy designed to sharply cut spending on this critical safety net program—and to repeal the Affordable Care Act, which provided subsidies for low- and moderate-income families to purchase health insurance through exchanges. The details for Romney’s own budget plan are not fully developed but he has embraced the principles of Rep. Paul Ryan’s (R-WI) budget plan, which is the basis for this comparison.

This plan would cut federal funding for Medicaid in half (49 percent) by 2030, hitting communities of color, children, and the elderly particularly hard. One case in point: 70 percent of nursing home residents eventually rely on Medicaid to help pay for their care. Deep cuts to Medicaid could result in less coverage for seniors who need long-term care or higher costs for the elderly and their families to bear. With nursing home costs averaging $80,000 a year, cuts to Medicaid would slam low-income and middle-class families who have a family member with an illness or disability. Here’s who would suffer in particular—communities of color make up approximately 43 percent of the elderly Medicaid population, with blacks comprising 17 percent, Asian Americans 7 percent, and Hispanics 10 percent, respectively.

Similarly, children of color would be disproportionately harmed by Romney’s proposal to fund Medicaid through block grants to the states. Medicaid currently provides low-income children with key services for healthy development through regular preventive care, follow-up, and treatment services. Children of color represent nearly three-fifths (59 percent) of children enrolled in Medicaid, with blacks comprising 26 percent, Asian Americans 3 percent, and Hispanics 22 percent, respectively. Cutting Medicaid could place in jeopardy these critical preventive health services for a key part of our future workforce.

Romney likes to paint these programs as entitlements that foster a culture of dependence. But in reality, Medicaid is an opportunity program, providing the health building blocks for children to be able to concentrate in school and become productive workers, or for families with a sick or disabled relative to be able to afford nursing home care so that they can stay in the workforce. Similarly, the Affordable Care Act expansion of coverage to low- and moderate-income families that Romney has called for repealing would provide families with the access to the health care they need to achieve greater economic security and opportunity.

These programs also create jobs for other Americans. As Medicaid dollars circulate through state and local economies, they create 17.1 new jobs for every $1 million in federal program spending. Under Rep. Ryan’s proposal to block-grant Medicaid, this would translate to a loss of nearly 3.1 million jobs between 2013 and 2020.

In contrast, Romney’s tax cuts for millionaires will not magically trickle down to create opportunity for the rest of us. We’ve tried this before with the Bush tax cuts. It failed.

Romney’s tax and budget plans will exacerbate inequality and undermine mobility, offering another tax cut to the 1 percent at the expense of health care for the 99 percent. Poor and middle-class families, especially among communities of color, cannot and should not bear this burden of Romney’s class warfare tax and budget plans.

Melissa Boteach is the Half in Ten Manager at the Center for American Progress Action Fund.

SOURCE: AP/Charles Dharapak

Republican presidential candidate and former Massachusetts Gov. Mitt Romney campaigns in Spartanburg, S.C.

Former Massachusetts Gov. Mitt Romney says his income from speaking fees, totaling more than $374,000, is “not very much,” even though this represents seven times the income of the average family. At the same time he says that his income is taxed only at 15 percent—much lower than the average worker, who gets taxed on his or her labor, not million-dollar investments.

This disconnect from the realities of everyday Americans may help explain Romney’s tax and budget plans. One common thread throughout his proposals are policies that offer huge tax breaks to the 1 percent while slashing the safety net for those in need of a hand up during hard times, which in turn threatens all of us when particularly hard times threaten the broader economy.

Romney’s plan, for example, offers $2.24 trillion in tax cuts to the top 1 percent of earners, which works out to an average tax cut of $165,000 for those who have an average income of $1.25 million according to the nonpartisan Tax Policy Center. In contrast, Romney is proposing cuts of about equal value to critical federal government programs relied upon by millions low- and moderate-income families today. (see Table 1)

Romney would institute these cuts by sending safety net programs “back to the states,” with capped funding in the form of block grants. He markets such proposals as reducing the deficit and providing more flexibility for states. But make no mistake: Block-granting programs such as food stamps (now called the Supplemental Nutrition Assistance Program, or SNAP) and Medicaid would increase hardship for struggling families, shift the burden to state budgets, and hinder the government’s ability to respond to future recessions. These cuts will harm low- and moderate-income families immediately, and will impact all of us as cuts ripple through the economy, costing jobs and forcing states to cut back on other programs to provide basic services.

So let’s look in more detail at the examples of SNAP and Medicaid.

Rep. Paul Ryan’s (R-WI) budget proposal, hailed by Romney as a visionary plan, included a plan to send SNAP and Medicaid “back to the states” as a block grant. The details for Romney’s own plan are not fully developed, but he has embraced the principles of the Ryan budget plan, which is the basis for this comparison.

According to analysis by the Center on Budget and Policy Priorities, the Ryan proposal would either cut the benefit level so low that it wouldn’t even meet the U.S. Department of Agriculture’s definition of a bare-bones diet, or it would kick more than 8 million vulnerable citizens off of food assistance, likely resulting in a spike in hunger.

It would also undermine SNAP’s ability to respond to recessions and result in higher hunger-related costs for state governments to bear. The reason: When unemployment goes up or natural disaster strikes, SNAP responds automatically to ensure that all families who meet the eligibility requirement can access nutritional assistance and, in doing so, creates jobs for other Americans as SNAP dollars ripple through the economy. Under a block grant, the program would lose this flexibility. Instead, states would have to decide at what level to set the benefit or eligibility—meaning families who lost a breadwinner would probably receive SNAP benefits set so low that struggling families would need to divert funds from other basic needs such as heating their homes or paying rent just to put food on the table—or else the program would turn families away.

The results would be particularly dramatic for households with children, seniors, or people with disabilities since nearly 75 percent of SNAP participants are in families with children, and more than 25 percent of participants are in households with seniors or people with disabilities. A spike in hunger would be costly to state economies too, resulting in lower educational achievement, lower workforce productivity, and higher health care costs—consequences that affect middle-income families as well.

For Medicaid the results would be even more dramatic. Cuts such as those proposed in the Ryan plan would not allow the program to keep pace with medical breakthroughs, an aging population, or rising health costs. As a result states would have to significantly cut eligibility or benefits for their Medicaid programs, reduce payments to health providers such that they may not be willing to treat Medicaid enrollees, or cut other vital state-run services or significantly raise taxes to continue helping vulnerable populations access basic health services.

Because Medicaid is already such a lean program, with costs significantly lower than private health insurance, there is not much spending that states could cut without significantly hurting Medicaid beneficiaries or the providers of their health care in the form of lower payments. Children represent the largest group of beneficiaries by far, accounting for about half of all enrollees, but people with disabilities account for the largest share of the program’s costs. Therefore block-granting Medicaid would hurt some of our most vulnerable citizens.

Similar to SNAP, block-granting Medicaid would also undermine the program’s ability to respond to recessions. This would hurt the 99 percent in a variety of ways. Medicaid enrollment rises as unemployment increases, and these dollars circulate through state and local economies, creating 17.1 new jobs for every $1 million in federal Medicaid spending. Under Rep. Ryan’s proposal to block-grant Medicaid, this would translate to a loss of nearly 3.1 million jobs between 2013 and 2020.

In short, block-granting safety net programs such as SNAP and Medicaid would have harmful effects on our most vulnerable citizens, shift costs to state governments, and undermine our ability to respond to recessions effectively and efficiently. What’s telling is that all these consequences that would disproportionately harm the most vulnerable and impact the 99 percent could be avoided for the cost of Romney’s tax cuts to the richest 1 percent of Americans.

Budget proposals reflect priorities. Based on Romney’s plan, it’s plain to see his policy proposals favor the 1 percent.

Melissa Boteach is the Half in Ten Manager at American Progress.

Sources for chart:

(1) Tax Policy Center Analysis showing that 34.3 percent of tax change goes to top 1 percent.

(2) Center for American Progress has shown that Romney’s tax plan totals $6.6 trillion over 10 years, and 34.3 percent of this is 2.24 trillion.

(3) Medicaid and health reform numbers come from Center on Budget and Policy Priorites paper here; SNAP numbers come from CBPP paper found here; 46 million Americans on food stamps comes from USDA; 72 million on Medicaid number comes from calculations based on this study.

Now Santorum is saying that he didn’t make the comment at all, it just sounded like he did, and by the way he has worked with black people. And then there’s Newt Gingrich who just reentered the fray to say that he was going to tell the NAACP convention to demand paychecks not food stamps. Since they and others like the CBC have been laser-focused on jobs, I wonder how they will receive Gingrich’s suggestion that he needs to guide them in that direction?

Read more here.

SOURCE: AP/ John Froschauer

Drastically reducing our nation's poverty rate is imperative not just for those in poverty, but for the country as a whole.

See also: A Strong Middle Class Is Key to Getting Our Economy Moving by Michael Ettlinger and Economic Inequality Is Not Sustainable by Heather Boushey

A new report from the Half in Ten campaign, “Restoring Shared Prosperity: Strategies to Cut Poverty and Expand Economic Growth,” examines recent data on poverty in our nation and provides a set of benchmarks to help policymakers stay on target to cut poverty in half in 10 years. The report shows that more than 15 percent of Americans—one in six—fell below the official poverty line in 2010—defined as a family of four with income below $22,314. Child poverty increased noticeably between 2009 and 2010, too, with more than one in five children—22 percent—living in poverty.

Recent U.S. census data and the new Half in Ten report clearly show the debilitating consequences of stagnant wages, high unemployment, and a slow economic recovery. Yet too often we separate the discussion of poverty reduction from debates about the overall U.S. economy. We do so at our own peril. Even before the Great Recession, the economy was not working for average Americans. Between 2003 and 2007 economic productivity and profits were on the rise, even as median wages for the average worker declined and poverty rates rose. The Half in Ten report outlines a new vision for shared economic growth that will restore the relationship between economic productivity and increased wages for workers.

While the millions of children and adults who live in poverty face real and immediate economic hardships, reducing the overall rate of poverty is a public good that will benefit Americans at every income level. Below are 10 reasons why cutting poverty is good for both individuals and the overall economic strength of the United States.

Individuals

Poverty affects more Americans than we think

While 15.1 percent of Americans lived below the official poverty line in 2010, this number is only a snapshot. At the same time more than 100 million Americans were struggling to get by on low incomes, earning below twice the poverty line ($44,700 a year for a family of four), and experiencing many of the same hardships as those officially defined as poor.

In addition, nearly one-third of Americans were cycling in and out of poverty even during the boom years. Between 2004 and 2007 32 percent of Americans had at least one spell of poverty lasting two or more months. During the same period chronic poverty was relatively low, with only 2.2 percent of Americans living in poverty for the entire period. These figures tell us that the poor are not a static group and that widespread economic insecurity has pushed millions of Americans into poverty or at risk of falling into poverty at some point during their lives.

Rising poverty among children is particularly harmful to society

In 2010 more than one in five children—22 percent—lived below the official poverty line. Children who live in families below the poverty line, even for short periods, are at greater risk of lower cognitive development, educational attainment, increased reliance on public benefits, and increased rates of incarceration. Consequently, children who grow up in poverty are more likely to have lower lifetime earnings due to the poverty-related risks. This means they are far less likely to grow up to become positive contributors to our economy and our society.

Poverty increases health risks

Poor children are much more likely to have lower birth weight, and infants living in poor households face higher rates of food insecurity, which impairs healthy development. As adults, lower-income individuals experience higher rates of illness, disease, and disabilities than those who have higher incomes. They have higher rates of chronic disease such as hypertension, high blood pressure, and elevated cholesterol. These conditions are exacerbated by the frequent lack of health insurance and access to medical care among lower-income individuals. Consequently, the life expectancies for poor individuals are much lower than those with high incomes. One estimate showed that individuals with low incomes had life expectancies 25 percent lower than those with higher incomes.

Poverty weakens families

Low-income and poor families face significant economic pressure as they struggle to pay bills and make ends meet. This economic pressure, coupled with other stressful events that are more prevalent in the lives of poor families, create high levels of psychological distress, including depression among poor parents. As couples struggle to make ends meet, their interactions become more hostile, and they tend to withdraw from each other—leading to fractures in relationships and poor parenting. Job losses, a major cause of poverty, increase a couple’s risk of divorce, especially for African Americans who experience two to three times greater risk of divorce in such circumstances than white couples.

Poverty traps individuals and decreases mobility

Children who grow up in poor families are more likely to be poor as adults compared to children from upper-income families, undermining the American Dream. These poor adults are also more likely to have poor children of their own. Only 6 percent of children born to poor parents (those in the bottom fifth of income earners) grow up to become rich (entering the top fifth of income earners) while nearly half of them (46 percent) remain just as poor.

United States

Poverty costs our economy billions of dollars annually

High rates of poverty hurt everyone in the United States because it strips limited resources from the government that could be invested in other areas to promote economic growth. Child poverty alone is estimated to cost the U.S. economy more than $500 billion annually in lost productivity, increased health care costs, and higher criminal-justice expenditures.

Poverty weakens the middle class, the engine of America’s economic growth

America’s economic strength is based on a strong middle class with purchasing power to fuel our economy and workforce contributions to increase our economic growth and productivity. The increasing number of Americans who slip from the middle class into poverty places downward pressure on our nation’s revenues due to the impact of lower earnings. Additionally, long periods of poverty produce downward effects on human-capital development by limiting access to education and training and proper health care. As a result, when individuals who have experienced long periods of poverty enter the workforce, their contributions may be restricted or minimal, while others may not enter the workforce at all. The result is low productivity from millions of underskilled Americans alongside a significant reduction in the purchasing power and savings among poor individuals. This results in lower demand from a large segment of our population and less investments to expand and grow the economy.

Poverty weakens communities and access to the American Dream

The long-term impact of concentrated poverty contributes greatly to the increasing income and wealth gap in the United States. Children living in neighborhoods that experienced a 10 percentage-point decline in poverty saw a $7,000 increase in family income as adults compared to those children living in neighborhoods without a reduction in the poverty rate. This cycle of poverty creates generations of individuals who are trapped in economically isolated communities with low incomes. This is at odds with our American values of opportunity for all.

Poverty lowers U.S. long-term competiveness

Poverty also dramatically harms long-term human-capital development, a critical component in our nation’s global economic competitiveness. A substantial body of research shows that children who grow up in poverty underperform in school, have limited access to higher education, and are less likely to be prepared for the high-skilled jobs of the future. With 22 percent of the nation’s children living in poverty, we are imperiling future generations of workers who will be needed to lead U.S. productivity and competitiveness.

Poverty weakens our democracy

Disparities of income, wealth, and access to opportunity are growing more sharply in the United States. The result is a system with unequal voices in which millions of low-income Americans do not fully exercise their rights as citizens. Those who enjoy higher incomes are more likely to make their values known to government officials. Consequently, when Americans with different income levels differ on policy preferences, the policy outcomes strongly reflect the values of the wealthy at the expense of the middle class and the poor. This reality conflicts with the cherished American ideals of equal representation and political equality.

Conclusion

These 10 reasons showing why cutting poverty in half in 10 years is good for our nation underscore the need for a comprehensive set of reforms to create greater opportunity for all and reduce the number of families who live in poverty. Specific strategies must be implemented to reduce the number of children who are born or fall into poverty. The economic consequences will be severe for future generations if we do not take swift action. We know the path to cut poverty, have done it before, and have the policy prescriptions to address the challenges that families and the nation now face.

The new report from Half in Ten outlines a broad policy framework that would help develop more good jobs, strengthen and protect families, and place more Americans on a path to economic stability. We have the blueprint for action. Now we need to act.

Desmond Brown is a consultant for the Center for American Progress Action Fund-led Half in Ten campaign to reduce poverty by half in 10 years.

See also: A Strong Middle Class Is Key to Getting Our Economy Moving by Michael Ettlinger and Economic Inequality Is Not Sustainable by Heather Boushey

SOURCE: AP/Bebeto Matthews

A coalition of New York City unions rally for a "March for the Middle Class" across the Brooklyn Bridge to City Hall on Wednesday, June 15, 2011 in New York.

New state income data released yesterday by the U.S. Census Bureau shows the importance of unions to boosting incomes for all middle-class households—union and nonunion alike. The 2010 income data makes it clear that strong unions are a critical factor in creating a middle-class society. Restoring the strength of unions would go a long way toward rebuilding the middle class.

The states with the lowest percentage of workers in unions—North Carolina, Georgia, Arkansas, Louisiana, Mississippi, South Carolina, Tennessee, Virginia, Oklahoma, and Texas—all have relatively weak middle classes. In each of these states, the share of income going to the middle class (the middle 60 percent of the population by income) is below the national average, according to Census Bureau figures.

Mapping the Census data that has been released this fall to previous years also shows that over time the strength of the middle class and the strength of the union movement have tracked closely together. In 1968, the share of income going to the nation’s middle class was 53.2 percent, when 28 percent of all workers were members of unions. Since then, union membership steadily declined alongside the share of income going to the middle class. By 2010, the middle class only received 46.5 percent of income as union membership dropped to less than 12 percent of workers.

As unions weakened, the lion’s share of the economy’s gains have gone to the wealthy. The share of pretax income earned by the richest 1 percent of Americans more than doubled between 1974 and 2007, climbing to 23 percent from 9 percent. And for the richest of the rich—the top 0.1 percent—the gains have been even more astronomical. Their share of income quadrupled over this period, rising to 12.3 percent of all income from 2.7 percent.

Without strong unions, the middle class has lost out to the wealthy.

To be sure, unions can sometimes act in an overly self-interested manner. But the core of what they do helps all workers and fuels a strong middle class. Unions make the middle class stronger by giving it a bigger say in our economy and our political system.

Unions increase wages for their members as well as raise standards and therefore increase wages for nonmembers. They also ensure that workers are considered in corporate decision-making, and provide job training that help workers advance in their careers. In the political arena, unions get workers involved to boost voting rates, and are champions of economic programs that create a strong middle class. They pushed for and have defended Social Security, Medicare, family leave, the minimum wage, and more recent policies such as health care reform.

In fact, dollar for dollar, strengthening unions is just about as important to the middle class as boosting college graduation rates, according to a study we conducted several months ago on the strength of the middle class in all 50 states and updated for this column based on the new Census figures. In our analysis we control for a variety of other factors that might also affect the strength of the middle class: education levels, unemployment rate, and industry composition. This enables us to assess the influence of unions by holding constant the effects of these other factors.

The table below shows the state-by-state impact of unions on income. If unionization rates increased by 10 percentage points—to roughly the level they were in 1980—the typical middle-class household, unionized or not, would earn $1,479 more a year.

To put that number in context, increasing college attainment rates by 10 percentage points would boost middle-class incomes by $1,638. Similarly, decreasing unemployment rates by 4 percentage points—bringing rates down to pre-Great Recession levels—would increase household income by $772 per household.

Our findings are consistent not just with our previous research, but also with a large body of academic research. Just last month, an article by Harvard’s Bruce Western and the University of Washington’s Jake Rosenfeld found that the decline of unions accounts for one-third of the rise in economic inequality in the United States over the past 30 years.

Even before the Great Recession, the middle class was struggling. Yet we can rebuild the middle class. It won’t be easy, and will require a range of solutions. But one thing is clear—stronger unions make a stronger middle class. And a strong middle class is the foundation for a vibrant American economy.

Dr. David Madland is the Director of the American Worker Project at American Progress and Nick Bunker is a Special Assistant with the Economic Policy team at American Progress.

See also:

• Infographic: Six Ways Unions Build a Strong Middle Class
• Interactive: How Unions Build a Strong Middle Class

SOURCE: AP/Paul Sakuma

A bill currently on Gov. Jerry Brown's (D-CA) desk would reform food stamp programs in the state to help more people access benefits.

California is typically at the forefront when it comes to progressive policies, but it now finds itself far behind the rest of the country in administering the Supplemental Nutrition Assistance Program, or SNAP, known as CalFresh in California. SNAP, formerly known as food stamps, is often cited as the first line of defense against hunger by allowing needy households to purchase food at grocery retailers through Electronic Benefit Transfer cards.

Currently, California has an overly complicated application and quarterly reporting system for Calfresh recipients that is burdensome to all involved and likely the cause of the low participation rates in the state. Participation rates in the program are extremely low with only about 50 percent of eligible Californians enrolled. These rates make California second to last among states on measures of program participation. A 100 percent participation rate of eligible households as seen in other states could mean an additional $4.9 billion in federal nutrition benefits for needy Californians.

California is the only state in the nation that does not use a simplified or semiannual reporting system despite the fact that the Department of Agriculture supports and encourages it because it decreases burdens for clients, reduces administrative workload, and improves accuracy. Similarly, California is one of only three states and a few localities that require participating households to complete a fingerprint image when applying for CalFresh. Until a few weeks ago, there were four states requiring finger print images for SNAP applicants, but Texas decided to eliminate the practice altogether.

California, therefore, now finds itself using antiquated practices and falling behind the curve on SNAP.

The California legislature recognizes that during the current climate of tight budgets and high levels of unemployment, California families are experiencing great need. In fact, the Los Angeles Times recently reported that California’s poverty rate rose for the fourth consecutive year. Referring to census data, the article also showed that 16.3 percent of Californians had incomes below the federal poverty line or $22,113 for a family of four in 2010.

We now have the opportunity to help low-income families increase their access to food and enable better eating habits. California’s Assembly Bill 6, or AB 6, which passed both houses of Congress and now sits on Gov. Jerry Brown’s desk, is an innovative piece of legislation aimed at relieving hunger in the neediest sectors of California by increasing the efficiency of existing federally funded programs.

In essence, this bill strives to ensure that people do not go hungry because of unnecessary red tape and bureaucracy and that instead they receive all benefits to which they are entitled. AB 6, written by assembly member Felipe Fuentes (D), would increase access to and participation in CalFresh by reducing costs and streamlining the application process. AB 6 also addresses another federally funded program, California Work Opportunity and Responsibility to Kids, known as CalWORKs, though to a lesser extent. CalWORKs provides temporary financial assistance and employment services to eligible needy California families and oftentimes CalWORKS families can qualify for an array of other programs including CalFresh.

AB 6 will require three major changes.

First, AB 6 will require CalFresh and CalWORKs to change from quarterly reporting systems to semiannual reporting systems. The quarterly reporting system in California is costly and straining on both the state and on needy Californians. A simplified reporting system would allow California to reduce the information that SNAP recipients must provide to the state to maintain their eligibility and benefits during their certification period. Most states have issued a 12-month certification period with semiannual reporting. States with simplified reporting systems reduce administrative workloads involved in tracing and responding to changes during a certification period. Simultaneously, SNAP recipients benefit because they report changes less frequently. The only instance in which SNAP recipients are required to report during the semiannual period is if their gross monthly income exceeds the SNAP eligibility.

Second, AB 6 would eliminate the Statewide Finger Imaging System, or SFIS, for all CalFresh households. Under Calfresh all adult members of a benefiting household must go to an office to be fingerprinted. In other states, however, only one adult family member is required to visit an office if at all. The Department of Agriculture found that in general finger imaging has a negative impact on program participation, so it decided to bar any additional states from implementing this practice. States using SFIS have an average of 7 percent lower program participation rates than similar states that do not use this system. SFIS’s original intent to combat duplicate aid fraud was well intentioned, but studies find the system to be economically unjustified at $17 million a year, and to be a largely ineffective and redundant fraud detection tool.

Finally, AB 6 incorporates a “heat and eat” initiative that would provide CalFresh households with a nominal energy assistance benefit through the Low Income Home Energy Assistance Program, qualifying them to receive the Standard Utility Allowance, or SUA. A household’s CalFresh benefits are based on a number of factors including income and housing and child care deductions. A utility allowance based on the types of utilities for which a household is responsible can be used as part of a household’s housing deductions for CalFresh. Under the provisions set forth by AB 6, all CalFresh households would automatically use the SUA as a component of their benefit calculations without verification of their utility expenses. This initiative would allow households who had not previously claimed the SUA to claim higher shelter costs, likely qualifying them for the excess shelter deductions and thereby increasing benefits for some households and removing verification burdens for others.

Heat and eat initiatives are used in Massachusetts, Vermont, Maine, Washington, New York, Rhode Island, Oregon, and Wisconsin. They are seen as a way of maximizing federal nutrition benefits while mitigating the effects of high housing and utility costs. This heat and eat provision would be the first initiative of its kind in California.

One of the most appealing aspects of AB 6 is that it is expected to generate a substantial economic effect. The Department of Agriculture has shown that every dollar in SNAP expenditures generates $1.79 in economic activity. Households that receive CalFresh benefits are able to redistribute some of their income that normally would only be used to purchase food. Consequently, part of this redistributed income can be spent on taxable goods, which in turn generate revenue for the state and counties.

In California it is estimated that through additional nutrition benefits, AB 6 will have the potential to benefit all Californians through more than $8.7 billion in associated economic activity.

The final stretch for this bill is in sight as it waits for Gov. Jerry Brown’s signature. Opportunities to improve nutrition for low-income Californians are far and few between given the current economic situation. AB 6 grants California the opportunity to use federal funds to their full capacity while lifting other statewide pressures. California must assume its role in combating America’s hunger and obesity problems by helping to ensure food security among low-income Californians in an efficient and sustainable manner.

Araceli Ruano is Senior Vice President and Director of the California Office and Rebecca Friendly is the Special Assistant for the California Office.

SOURCE: AP/J. Scott Applewhite

House Speaker John Boehner (R-OH) is proposing a deficit reduction plan that drastically cuts poverty programs while child poverty in the speaker's district rose almost 50 percent from 2008 to 2009.

House Speaker John Boehner (R-OH) and House Republicans are pushing reckless cuts that would take America’s economy back half a century. Their "cuts only" approach to deficit reduction would force painful cuts in effective human needs programs such as SNAP/food stamps and Head Start while leaving tax breaks for hedge fund managers, corporate jet owners, and oil companies off the table. But how would such an approach affect Speaker Boehner’s own constituents in Ohio’s 8th congressional district?

We don’t know how many hedge fund managers live in the speaker’s district, but we’re guessing it’s less than the 88,889 constituents who live in poverty.[1] And while we don’t know how many corporate jet owners live in the speaker’s district, we’re guessing it’s less than the 30,240 constituent households who receive SNAP/food stamps.

What we know for sure is that that two companies that benefit from oil subsidies, Exxon Mobil and Royal Dutch Shell, reported first-quarter profit increases of 69 percent and 30 percent, respectively, this year. And we know that the Census reported a nearly 50 percent increase in child poverty in the speaker’s district from 13.05 percent in 2008 to 19.1 percent in 2009.

Speaker Boehner insists that subsides for oil companies be protected in deficit negotiations. He has yet to announce such protection for the 356,068 women, infants, and children eligible for the WIC nutrition assistance program in Ohio.

We need to reduce our nation’s long-term deficits. But how we do so reflects our values and priorities as a country. Speaker Boehner’s “cuts only” approach as reflected in the Budget Control Act (S.627) is the wrong way forward. This legislation would raise the debt ceiling for only six months in exchange for $3 trillion in spending cuts over the next 10 years—$1.2 trillion passed now and another $1.8 trillion passed before the debt ceiling could be raised again. No revenue is included, and cuts are concentrated in parts of the budget that include programs that help struggling families such as Head Start and the women, infants, and children supplemental nutrition program.

The House plan would result in an enormous increase in poverty and hardship while keeping Congress mired in a never-ending debate over default crises instead of a focus on jobs. In fact, the speaker’s plan would break a 26-year policy of exempting basic low-income entitlement programs from across-the-board cuts, dropping all of the low-income exemptions that every past deficit reduction package has included since 1985.

It’s unconscionable to force cuts to programs helping the most vulnerable while leaving special tax breaks for oil companies and hedge fund managers off the table. We encourage Speaker Boehner to check out these statistics for OH-8:

• 180,000 people are on Medicare or Medicaid, comprising 27 percent of his district.
• 4,000 households access some form of public housing assistance.[2]
• 90,000 or 13.9 percent of the district lives below the poverty line.
• Approximately 70,000 households receive Social Security benefits.
• Over 30,000 households are eligible for the SNAP (food stamp) program and 20,000 low-income children are eligible for food and nutrition services.[3]
• 500,000 unemployed workers receive job training and placement services in his state.

These types of priorities are bad for Speaker Boehner’s district and bad for the country.

Melissa Boteach is Manager of the Half in Ten program and Jessica Liu is an intern at American Progress.

Endnotes

[1]. American Community Survey figures are for 2009, the latest figures published by the Census.

[2]. From housing vouchers and certificates alone, estimated using county data.

[3]. Eligibility numbers are estimated for children 0-5 years old, via a method the Urban Institute detailed in the report "WIC Income Elligible Children by Congressional District and State" (2010), available at http://www.urban.org/uploadedpdf/412056_WIC_eligible.pdf.

SOURCE: AP/Paul Sakuma

Job seekers look for employment on computers at JobTrain, an educational and training institution that also offers career counseling and job placement services, in Menlo Park, California. Cuts in the GOP budget bill would result in more than 8 million adults and youth losing access to training and other employment services.

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The House GOP is boasting that their spending bill to fund the government for the remainder of fiscal year 2011 makes the largest cuts to domestic annual spending in history. But you don’t hear them boasting that these cuts will cut unemployed workers off of job training, force low-income veterans into homelessness, result in millions of low-income college students losing some or all of their education aid, or cause tens of thousands of vulnerable seniors to lose access to home-delivered food baskets.

And you certainly don’t hear them touting that allowing just one year’s worth of bonus tax breaks for the wealthiest Americans to lapse would reduce the deficit twice as much as the cuts to low-income programs outlined in the appendix.

Congress recently proposed a short-term bill to avoid a government shutdown. It contains smaller, more reasonable cuts to fund the government for two weeks while negotiations continue on a full-year funding bill. But the GOP position is reflected in the cuts below, which they proposed in their original continuing resolution for FY2011.

The timing for these cuts couldn’t be worse:

At a time when approximately 14 million Americans are out of work…

Cuts in the GOP bill would:

• Result in more than 8 million adults and youth losing access to job training and other employment services.
• Eliminate successful jobs programs such as YouthBuild, national service programs, and the Green Jobs Innovation Fund.

At a time when unemployment is still at 9 percent…

Cuts in the GOP bill would:

• Imperil economic growth and drive up the jobless rate. New analysis by economists at Goldman Sachs shows that GOP-passed cuts would reduce economic growth by 1.5 to 2 percentage points in the next two quarters. Based on historical economic relationships this could push the unemployment rate back up to 9.7 to 10 percent.

At a time when 135,000 veterans are homeless…

Cuts in the GOP bill would cut in half the number of veterans who would receive housing vouchers this year, preventing 10,000 low-income veterans from receiving assistance to avoid homelessness.

At a time when the United States is now 12th worldwide in the percentage of 25- to 34-year-olds with a college degree…

Cuts in the GOP bill would:

• Result in 9.4 million low-income college students losing all or some of their Pell grant.
• Reduce the maximum Pell grant by 17.4 percent.

At a time when nearly one in six Americans live in households struggling against hunger…

Cuts in the GOP bill would:

• Result in 81,000 people—mostly vulnerable seniors—losing access to the nutritious food baskets they receive through the Commodity Supplemental Food Program.

At a time when there is a shortage of 3.1 million affordable housing units for extremely low-income families….

Cuts in the GOP bill would:

• Result in 10,000 people with serious long-term disabilities losing rental assistance through the Section 811 voucher program. Most of these would lose their homes.
• Allow the housing units of the 1.2 million low-income families in public housing to deteriorate as the Public Housing Capital Fund—which makes maintenance and repairs on the U.S. stock of public housing—is cut by over 40 percent.

At a time when the number of households requesting help for heating and cooling assistance is expected to reach record levels…

• Cuts in the GOP bill would essentially wipe out the Low-Income Home Energy Assistance Program Contingency Fund for the rest of 2011. The fund helps families cope with harsh weather conditions and spiking fuel costs.[1]

At a time when one in seven Americans and one in five children live in poverty…

Cuts in the GOP bill would:

• Cut off 218,000 low-income children from early learning opportunities provided by Head Start and close more than 16,000 Head Start and Early Head Start classrooms. [2]
• Affect the access of over 20 million low-income people who depend on community action agencies for a range of antipoverty services.

Sadly, not everyone is being asked to share in this sacrifice. The latest census data show that from 2008 to 2009 almost everyone’s income continued to fall in the Great Recession except for the top 5 percent of Americans.

At a time when the richest 5 percent of Americans claimed almost 22 percent of all income in 2009 and the top fifth took home fully half of the nation’s income…

We should be looking at both spending and revenue to address the deficit. Just one year of the tax cuts for those earning over $250,000 per year is worth more than twice as much as much in deficit reduction as the cuts inflicted on programs assisting low-income families combined (see appendix for sampling of programs).

We all agree that we need to tackle our long-term deficits. But the House GOP proposal apportions most of the sacrifice to low-income families, homeless vets, and disabled and elderly Americans, instead of taking a balanced approach and examining the entire budget for wasteful tax expenditures, unnecessary military spending, targeted spending cuts, or fair and efficient ways to raise revenue.

For more information on the impact of the cuts see the report by Half in Ten partner The Coalition on Human Needs, “A Better Budget for All: Saving Our Economy and Helping Those in Need.”

Melissa Boteach is the Half in Ten Manager at the Center for American Progress Action Fund.

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Endnotes

[1]. The House slashed nearly $400 million from a $590 million fund. But because $150 million had already been spent only about $65 million would remain for the rest of the year to deal with heating or cooling needs.

[2]. This number includes 61,000 Head Start and Early Head Start slots slated to expire under the Recovery Act.