We dodged another shut-down bullet, but only
until November 18. That’s when the next temporary bill to keep the
government going runs out. House Republicans want more budget cuts as
their price for another stopgap spending bill.
Among other items, Republicans are demanding major cuts in a
nutrition program for low-income women and children. The appropriation
bill the House passed June 16 would deny benefits to more than 700,000
eligible low-income women and young children next year.
What kind of country are we living in?
More than one in three families with young children is now living in
poverty (37 percent, to be exact) according to a recent analysis of
Census data by Northeastern University’s Center for Labor Market
Studies. That’s the highest percent on record. The Agriculture
Department says nearly one in four young children (23.6) lives in a
family that had difficulty affording sufficient food at some point last
year.
We’re in the worst economy since the Great Depression – with
lower-income families and kids are bearing the worst of it – and what
are Republicans doing? Cutting programs Americans desperately need to
get through it.
Medicaid is also under assault. Congressional Republicans want to
reduce the federal contribution to Medicaid by $771 billion over next
decade and shift more costs to states and low-income Americans.
It gets worse. Most federal programs to help children and
lower-income families are in the so-called “non-defense discretionary”
category of the federal budget. The congressional super-committee
charged with coming up with $1.5 trillion of cuts eight weeks from now
will almost certainly take a big whack at this category because it’s the
easiest to cut. Unlike entitlements, these programs depend on yearly
appropriations.
Even if the super-committee doesn’t agree (or even if they do, and
Congress doesn’t approve of their proposal) an automatic trigger will
make huge cuts in domestic discretionary spending.
It gets even worse. Drastic cuts are already underway at the state
and local levels. Since the fiscal year began in July, states no longer
receive about $150 billion in federal stimulus money — money that was
used to fill gaps in state budgets over the last two years.
The result is a downward cascade of budget cuts – from the federal
government to state governments and then to local governments – that are
hurting most Americans but kids and lower-income families in
particular.
So far this year, 23 states have reduced education spending.
According to a survey of city finance officers released Tuesday by the
National League of Cities, half of all American cities face cuts in
state aid for education.
As housing values plummet, local property tax receipts are down. That
means even less money for schools and local family services. So kids
are getting larger class sizes, reduced school hours, shorter school
weeks, cuts in pre-Kindergarten programs (Texas has eliminated
pre-Kindergarten for 100,000 children), even charges for textbooks and
extra-curricular activities.
Meanwhile the size of America’s school-age population keeps growing
notwithstanding. Between now and 2015, an additional 2 million kids are
expected to show up in our schools.
Local family services are being cut or terminated. Tens of thousands
of social workers have been laid off. Cities and counties are reducing
or eliminating their contributions to Head Start, which provides early
childhood education to the children of low-income parents.
All this would be bad enough if the economy were functioning normally. For these cuts to happen now is morally indefensible.
Yet Republicans won’t consider increasing taxes on the rich to pay
for what’s needed – even though the wealthiest members of our society
are richer than ever, taking home a bigger slice of total income and
wealth than in seventy-five years, and paying the lowest tax rates in
three decades.
The President’s modest proposals to raise taxes on the rich –
limiting their tax deductions, ending the Bush tax cut for incomes over
$250,000, and making sure the rich pay at the same rate as average
Americans – don’t come close to paying for what American families need.
Marginal tax rates should be raised at the top, and more tax
brackets should be added for incomes over $500,000, over $1,500,000,
over $5 million. The capital gains tax should be as high as that on
ordinary income.
Wealth over $7.2 million should be subject to a 2 percent surtax.
After all, the top one half of 1 percent now owns over 28 percent of the
nation’s total wealth. Such a tax on them would yield $70 billion a
year. According to an analysis by Yale’s Bruce Ackerman and Anne
Alstott, that would generate at least half of $1.5 trillion
deficit-reduction target over ten years set for the supercommittee.
Another way to raise money would be through a tiny tax (one-half of
one percent) tax on financial transactions. This would generate $200
billion a year, and hardly disturb Wall Street’s casino at all. (The
European Commission is about to unveil such a tax there.)
All this can be done, but only if Americans understand what’s really at stake here.
When Republicans recently charged the President with promoting “class
warfare,” he answered it was “just math.” But it’s more than math. It’s
a matter of morality.
Republicans have posed the deepest moral question of any society: whether we’re all in it together.
Their answer is we’re not.
President Obama should proclaim, loudly and clearly, we are.
Robert Reich is Chancellor's Professor of Public Policy at the University of California at Berkeley. He writes a blog at www.robertreich.org. His most recent book is Aftershock.
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