CHN: Budget Process Bill Endangers Services for Seniors, People with Disabilities, Low-Income Families and Others

June 7, 2004

Legislation designed to change the rules under which Congress makes a budget is expected to be considered by the House of Representatives within the next two weeks. The proposals being considered are a misguided attempt to place the full burden of deficit reduction on vulnerable people – children, elders, those with disabilities, and low-income working families.

The bill that the House Budget Committee approved earlier this year (HR 3973) will put in danger the federal government’s ability to meet the needs of the 43 million Americans without health insurance, the 35 million poor, the 9 million unemployed and nearly 3.5 million people who will experience homelessness this year. The bill will cut deeply spending for programs that serve the most vulnerable while doing nothing to restrain Congress from passing more tax cuts that are not paid for. It is doubtful the budget process bill will curtail the federal deficit.

The bill will force cuts to discretionary programs – those Congress funds every year – by placing tight caps on spending for programs such as education, child nutrition, housing, job training and others. The long-term effect of the proposed discretionary caps will be worse than the cuts the administration is planning for its fiscal year 2006 budget.

Entitlement programs (programs that do not need to be appropriated each year) are also on the chopping block. It is likely the House will consider an amendment to HR 3973 that will cut entitlement spending by $1.8 trillion over the next ten years. If those cuts are applied proportionately to all entitlement programs, Medicare would be cut by $800 billion, Medicaid by nearly $400 billion, Food Stamps by $43 billion, unemployment compensation by $69 billion, welfare-to-work, child care and child support enforcement by $27 billion, school lunch and other child nutrition programs by $23 billion, and foster care and adoption assistance by $13 billion. Every single entitlement program except Social Security is at risk, including student loans, State Children’s Health Insurance Program, the Earned Income Tax Cut and veteran’s benefits. If adopted, an entitlement cap would cripple the flexibility and responsiveness of programs such as Food Stamps and health coverage, which rise to meet need when the economy turns down.

HR 3973 also changes the ground rules for passing a budget, making it easier for Congress to pass more tax cuts that are not paid for while making it very difficult to expand programs like Medicaid or the Earned Income Tax Credit. Under these lopsided “pay-as-you-go” rules, Congress would not be required to pay for any new tax breaks, allowing them to make the deficit deeper. But Congress would be required to pay for any new entitlement spending by cutting entitlements elsewhere.

Even if the bill passes the House floor, it is unlikely the Senate will take it up this year. However, the Coalition on Human Needs believes this legislation is merely the first step in a long-term campaign aimed at cutting spending for human needs programs. Several members of the Coalition are working to oppose the budget process legislation by educating House members, making phone calls, doing visits and sending letters of opposition. The letter that CHN sent to all House members is on the CHN web site.

For More Information:
Center on Budget and Policy Priorities: Key Issues and Threats in the House Budget Process Debate

CHN letter to House of Representatives on budget process

Categories: Budget and Appropriations