Dangerous Impact of Sequestration Cutsby Representative Janice D. Schakowsky
Posted on 2013-02-26
in the house of representatives
Tuesday, February 26, 2013
Ms. SCHAKOWSKY. Mr. Speaker, I rise today to share with my colleagues
two documents that outline both the dangerous impact of sequestration
cuts and how we could replace them in a way that helps, not hurts, the
The report, ``Protecting Our Nation from Bad Federal Budget Choices,'' from the Coalition on Human Needs, includes these key facts about the sequester's impact: 600,000 children and mothers will lose nutritional aid under WIC (the Women, Infants, and Children program).
[[Page E194]] 125,000 low-income families will lose rental housing vouchers.
70,000 children will be denied Head Start.
4 million fewer Meals on Wheels meals served to seniors.
373,000 adults and children with serious mental illness will lose treatment.
I would also like to draw my colleagues' attention to, ``Faithful Alternatives to the Sequester,'' from the Interreligious Working Group on Domestic Human Needs. I would like to quote from their document: ``We are alarmed at the growing economic divergence between rich and poor, creating permanent inequalities that are neither just nor socially sustainable. Over the past thirty years, tax policy has too often been used to perpetuate rather than address these inequalities. It is our responsibility, both individually and collectively, to respond to those who are in need--people living in poverty have sacrificed more than enough on the altar of deficit reduction. We need a more progressive tax code, where all members of the community carry their fair share of the responsibility, not only to ensure that we can meet immediate need while simultaneously reducing our deficits, but also to begin to address the astronomical growth in disparity over the last thirty years. . . .
``There are core challenges facing our nation: rising income inequality, persistent unemployment, historically high rates of poverty and anemic economic growth. These challenges must be addressed with justice. . . .
``Our approach to upcoming sequestration needs to be rooted in our values--a balanced approach that addresses the deficit crisis with justice and compassion. On the one hand, we need to be good stewards of the resources we already have, making judicious cuts to defense, earmarks, and other wasteful spending, while preserving that which is most important for the good of all. On the other hand, we must increase revenue, in order to ensure that this nation can meet our need to operate a fair and just economy, which serves all of our human community. The nation's deficit crisis cannot be solved through spending cuts alone--new revenues must be part of the solution. The need is great and the resources are abundant. The budget choices we make must reflect this reality.'' I hope my colleagues will read these important studies and act to stop these harmful cuts. We should ask those who can afford it to contribute more, not jeopardize the well-being and futures of low- income and middle-class families.
DHN Interreligious Working Group on Domestic Human Needs faithful alternatives to sequestration From everyone to whom much has been given, much will be required; and from one to whom much has been entrusted, even more will be demanded.--Luke 12:48 Rabbi Abba said in the name of Rabbi Simeon ben Lakish: the person who lends money [to a poor person] is greater than the person who gives charity; and the one who throws money into a common purse [to form a partnership with the poor person] is greater than either.--B. Shabbat 63b As people of faith, we believe that our economic arrangements with each other should serve to support God's creation and should help the human community to flourish. We therefore challenge the current economic reality that traps families in poverty for generations. The widening gap in income and wealth, as well as the persistence of poverty, especially among children, are inconsistent with God's intention for this world.
Our community seeks to advance the values of cooperation, social justice, and equal opportunity, while restraining those of greed, speculation, and inherited privilege. At the root of our economic system must be fairness and justice. Without these values, our economy is, quite literally, demoralized.
Crushing poverty in a world of abundance is insufferable and our nation has allowed too much injustice and greed to govern our current economic structures. Instead, we seek to increase equity and equality in this nation. We are alarmed at the growing economic divergence between rich and poor, creating permanent inequalities that are neither just nor socially sustainable. Over the past thirty years, tax policy has too often been used to perpetuate rather than address these inequalities. It is our responsibility, both individually and collectively, to respond to those who are in need--people living in poverty have sacrificed more than enough on the altar of deficit reduction. We need a more progressive tax code, where all members of the community carry their fair share of the responsibility, not only to ensure that we can meet immediate need while simultaneously reducing our deficits, but also to begin to address the astronomical growth in disparity over the last thirty years. As one of our traditions so eloquently says, `from everyone to whom much has been given, much will be required.'' It is from this place of concern for the common good, right relationship, and the just working of the economy, that we seek a balanced approach to deficit reduction. Sequestration was developed as a backstop--a last resort if Congress failed to act in a more thoughtful and balanced way. Whether Congress uses sequestration or some alternative as a means of achieving deficit reduction, Congress can and must act in a way that reflects our shared values. There are core challenges facing our nation: rising income inequality, persistent unemployment, historically high rates of poverty and anemic economic growth. These challenges must be addressed with justice.
Therefore, we refuse to accept additional spending cuts to programs that serve ``the least of these,'' and we support extending the tax cuts for low and middle-income families. In particular, we support a strong, refundable Earned Income Tax Credit and Child Tax Credit, as they are some of this nation's most effective tools for alleviating poverty.
Our approach to upcoming sequestration needs to be rooted in our values--a balanced approach that addresses the deficit crisis with justice and compassion. On the one hand, we need to be good stewards of the resources we already have, making judicious cuts to defense, earmarks, and other wasteful spending, while preserving that which is most important for the good of all. On the other hand, we must increase revenue, in order to ensure that this nation can meet our need to operate a fair and just economy, which serves all of our human community. The nation's deficit crisis cannot be solved through spending cuts alone--new revenues must be part of the solution. The need is great and the resources are abundant. The budget choices we make must reflect this reality.
Therefore, we urge members of Congress to enact a comprehensive, balanced, and bipartisan deficit reduction package that: 1. Continues the precedent established and maintained for the past three decades--including in the Budget Control Act-- that deficit reduction should not increase poverty; 2. Protects from budget cuts discretionary and mandatory programs that make a real difference in the lives of poor and vulnerable people, and preserves the bi-partisan agreement to exempt low-income mandatory programs from such cuts; 3. Maintains the integrity and structure of low-income mandatory programs, such as SNAP and Medicaid, so they can continue to serve as effective tools for reducing poverty and countering economic downturns; 4. Accounts for the fact that, since 2010, non-defense discretionary spending has already contributed hundreds of billions of dollars toward deficit reduction--these programs should not have to sacrifice anymore; 5. Raises new revenues in ways that will allow us to meet this nation's needs by: a. Increasing the progressivity of the tax code; b. Continuing current tax credits for low-income working households, proven effective at alleviating poverty and rewarding work, such as the Earned Income Tax Credit and the Child Tax Credit; c. Generating new revenue with a simpler, more progressive tax code from a broader tax base (including capital gains, dividends, and estate taxes) and increasing rates, if necessary; d. Not relying only on anticipated economic growth to generate new tax revenue; e. Eliminating tax expenditures not proven to influence behavior, such as subsidies to established corporations that no longer need government support.
6. Reduces health care costs system-wide so as to: a. Retain and implement the important improvements to access and cost containment strategies enacted in the Affordable Care Act; b. Prevent cost-shifting to people who cannot afford it; c. Refrain from putting further strain on states; 7. Includes significant cuts in military spending as recommended by several bipartisan commissions and non- governmental organizations, such as the Bowles-Simpson Commission, the Sustainable Defense Task Force, the Bipartisan Policy Center, and the Committee for a Responsible Budget.
8. Declines to shift defense cuts to non-defense discretionary and mandatory programs, which have carried the heaviest burden of spending reductions already enacted.
In a time of continuing, deep economic uncertainty, our faith gives us strength to face unemployment, poverty, and anxiety--not simply as individuals, but as a community with an ethical memory rooted in our shared sacred texts. Today's fiscal debates not only miss what should be the goal of the economy--the common good--but also, they fail to ensure that the functioning of the economy will, indeed, serve this purpose. As Congress considers replacing the sequester mechanism, it must pursue a balanced approach that ensures that our collective responsibility to each other can and will be met.
American Friends Service Committee Bread for the World Church World Service Commission on Social Action of Reform Judaism Conference of Major Superiors of Men Disciples Justice Action Network Ecumenical Advocacy Days for Global Peace with Justice The Faithful Budget Campaign Faithful Reform in Health Care Franciscan Action Network Friends Committee on National Legislation Leadership Conference of Women Religious Mennonite Central Committee U.S. Washington Office National Advocacy Center of the Sisters of the Good Shepherd [[Page E195]] National Council of Churches of Christ in the USA National Council of Jewish Women NETWORK, A National Catholic Social Justice Lobby New Community Project Presbyterian Church (U.S.A.) Office of Public Witness RESULTS Faith in Action Sisters of Mercy Institute Justice Team The Unitarian Universalist Association of Congregations United Church of Christ, Justice and Witness Ministries The United Methodist Church--General Board of Church and Society ____ Coalition on Human Needs Protecting Our Nation from Bad Federal Budget Choices A new round of federal budget cuts is slated to start on March 1. If nothing is done, the cuts will deny food to young children, turn low-income families out of their homes, and reduce funds for education and training. These indiscriminate across-the-board cuts (called ``sequestration'') come on top of an average 7.6 percent cut in federal funds to states since 2010. The looming federal cuts would make things worse, hurting vulnerable people, shifting burdens to states and localities, and threatening economic growth.
This does not have to happen. Increased revenues from wealthy individuals and profitable corporations as well as savings from reducing waste in the Pentagon and elsewhere can prevent these cuts. In fact, Senate Majority Leader Harry Reid (D-NV) and other senators outlined a plan on February 14 (the American Family Economic Protection Act) that would replace the 2013 cuts by setting a minimum tax rate for millionaires, closing other loopholes, gradually cutting the Pentagon and ending certain farm subsidies. It will be up for a vote during the week of February 25. House Democrats have also introduced a balanced alternative.
These cuts will hurt our nation. The indiscriminate cuts have the potential to stall the beginnings of economic recovery because lost jobs and reduced assistance mean people will have less to spend. The recovery still had not reached the 7.9 percent of the U.S. workforce unemployed in January 2013. We should be investing in rebuilding our communities and training for workers, not throwing 10,000 teachers and aides in low-income schools out of work, with about 700,000 jobs expected to be lost overall because of sequestration. And the real hardships caused by 600,000 young children and mothers losing WIC food assistance and between 110,000- 125,000 families losing their housing vouchers nationwide do not just hold back our economy this year. They threaten the health and development of children and the stability of families in ways that will cost all of us for years to come.
Revenues, Not Cuts. Closing loopholes for corporations and the wealthy can generate well over $2 trillion in federal revenue over the next 10 years. In order to stop the deficit from growing as a share of the economy, economists estimate that another $1.5 trillion is needed over the next decade, either from new revenues or cuts in spending. Millionaires, who have gained more than $1 million each from the Bush tax cuts since 2004, can afford to pay more. A 5.6 percent surtax on income over $1 million could raise more than $450 billion over 10 years--enough to cancel most of the decade of domestic cuts slated to begin with this March's sequestration. Taxing the profits of corporations sheltered offshore at the same rate as profits made in the U.S. can raise as much as $600 billion over 10 years.
Don't Touch SNAP and Medicaid. Congress should act now to stop the needless cuts in vital programs that will begin March 1, but should not replace them with cuts to essential services such as Medicaid or SNAP/food stamps. We have seen harsh proposals to cut these programs in the budget passed by the U.S. House for FY 2013 (but rejected by the Senate). The House budget would have slashed $134 billion from SNAP over 10 years, and $810 billion from Medicaid. If the SNAP cut were to be applied by reducing benefits equally across all households, a family of four would be expected to lose $90 a month in FY 2016 dollars. (This year, the national average monthly SNAP benefit for a family of four is $508.) Or, if the extreme cut were applied by making people ineligible, 8 million people nationwide would be denied all SNAP benefits. If the House budget's extreme Medicaid cut had been in place from 2001-2010, most states would have received at least 35 percent less in 2010 than they actually did, such a huge cut that millions of people nationwide would either be denied coverage altogether or would see their benefits slashed. Taking food and medical care from our state's poorest people is a wholly unacceptable alternative to the cuts about to be imposed.
The Pentagon Can Be Cut. The deficit reduction legislation now in place requires nearly $1 trillion in cuts between now and FY 2021, half from defense and half from domestic and international programs. Many experts believe that the Pentagon can be cut $500 billion or more over the next decade, and that such reductions will actually enhance our national security by ending wasteful expenditures and freeing up the funds for more productive uses or for deficit reduction. Even if $500 billion were cut, the U.S. would still be spending more on the military than the next 14 nations combined, most of whom are our allies. Some examples of possible Pentagon savings with expert support: reducing the number of troops assigned to overseas bases by 25 percent (not counting troops in war zones) would save $80 billion over the next ten years; reducing deployed nuclear warheads to 1,000-1,100 would save $28 billion over the same period; buying a reliable, cheaper jet rather than the problem- plagued F-35C would save close to $17 billion.
But Investments in Our Future--and Vulnerable People--Must Be Protected. More than 1 in 5 children in the U.S. were poor in 2011. 13.2 percent of people between 18-24 nationwide had not finished high school. For poor children and young adults to succeed, we need to invest in all levels of education. But the sequestration cuts would deny Head Start to 70,000 children this year, and cut Title I K-12 education funding for schools in low-income communities by nearly $726 million, an amount equal to dropping services for 1.2 million low- income children. For our economy to grow, workers must be able to increase their skills, but federal job training funds will be cut by more than $160 million nationwide if the sequester reductions occur this year, and more than 75,000 workers with disabilities will not be able to enroll in vocational rehabilitation services. In a time of rising inequality and more people falling out of the middle class into poverty, we need more routes out of poverty. But the impending cuts would deny Work-Study aid to 33,000 students. Struggling workers will be hit repeatedly: if they are among the long-term unemployed, cuts in federal emergency unemployment compensation will force an up to 9.4 percent cut in benefits, estimated at an average loss of $400 for the rest of this year. If they are parents working or looking for work, they may lose child care assistance; the cuts are expected to end child care subsidies for 30,000 children across the country.
We cannot sustain and expand economic recovery while pushing our most vulnerable people into more desperate straits. The cuts about to take effect will take away rental assistance vouchers from between 110,000-125,000 families nationwide. These vouchers limit the families' rent payments to 30 percent of their income. If they were abruptly expected to pay market rents, large numbers of these families will be forced out of their apartments, with increasing homelessness a certainty. At the same time, sequestration will end housing assistance to approximately 100,000 formerly homeless people nationwide, including veterans. To add to poor families' struggles to afford housing, home energy assistance will be cut an estimated $180 million. Even without this cut, rising heating costs mean that aid under the Low Income Home Energy Assistance Program (LIHEAP) is expected to average only $375 per household served in 2013, down from $405 in 2012.
Even though there is ample evidence that adequate nutrition is vital for brain development in the first years of life, the impending indiscriminate cuts would deny WIC nutrition aid to 600,000 mothers, infants, and young children. The cuts will also jeopardize the health of seniors, with 4 million fewer meals delivered nationwide.
Cuts That Increase Joblessness and Disinvest in Our People Will Weaken the Nation. Congress should stop the mindless across-the-board sequestration cuts. Instead, it should enact a balanced package with enough revenues from the wealthy and corporations and sensible Pentagon and other savings to protect our children, our workers, and our seniors.
Those who oppose any new revenues or Pentagon savings should be asked why they think it is more important to preserve, for example, hundreds of billions in corporate tax incentives to shift jobs and profits offshore or to waste hundreds of billions in unneeded weapons and bases than to prevent cuts in education, housing, nutrition, environmental protection, public health, child care, rebuilding communities, and many other investments.
Sequester Damage Children and mothers losing WIC nutrition aid: 600,000.
Low-income families losing rental housing vouchers: 125,000.
Formerly homeless people losing housing: 100,000.
Children denied Head Start: 70,000.
Funding cut from Head Start: $406m.
Children denied affordable child care: 30,000.
$ cuts deep enough to end services to these many low-income K-12 children: $1.2b.
Fewer people with disabilities served by Vocational Rehab: 75,700.
Fewer meals on wheels served to seniors: 4m.
Adults and children with serious mental illness losing treatment: 373,000.
Unemployment benefits cut for long-term unemployed: 9.4%.
Jobs lost because of sequestration: 700,000.