Archive for February, 2011

Just after a Goldman Sachs report predicted that proposed House Republican budget cuts would hurt economic growth, a new Moody’s report finds the same.

Key finding: “The House Republicans’ proposal would reduce 2011 real GDP growth by 0.5% and 2012 growth by 0.2 percentage points This would mean some 400,000 fewer jobs created by the end of 2011 and 700,000 fewer jobs by the end of 2012.”

Furthermore, the report claims “a government shutdown lasting longer than a couple of weeks would do much more damage to the economy.”

Not only do the cuts harm children, they will threaten the economic recovery and cost jobs. Why are we doing this again?

According to the Center on Budget and Policy Priorities, at least 16 states have proposed identifiable cuts in support for public schools.  In many cases, these cuts undermine school finance systems that are intended to reduce disparities between high-wealth and low-wealth school districts, so the largest impacts may be felt in communities that are least able to compensate for the loss of funds from their own resources.  (These cuts are in addition to education cuts already implemented in at least 34 states since the recession began.)

• Colorado Governor Hickenlooper’s budget proposal would cut state spending on K-12 education by $497 per pupil.
• Florida ’s Governor Scott would impose a $700 per pupil, or 10 percent, reduction in state and local spending on K-12 education.  This cut results from a small reduction in the state’s share of education funding, a large reduction in the property taxes local school districts are required to levy to receive state education aid, and the disappearance of most federal fiscal relief.
• Governor Deal of Georgia proposes to cut state and lottery funds for pre-kindergarten by 5.6 percent.  This would require eliminating 4,500 pre-K slots, reducing payments to providers by nearly $230 per child, or a mix of cutting slots and reducing payments.
• Governor Branstad of Iowa eliminates the state’s voluntary preschool program, replacing it with a means-tested voucher program, and halves other state funds that help children access preschool. As a result, state support for preschool will decline by 41 percent.
• Kansas Governor Brownback proposes a $232 per-pupil cut in K-12 base student funding, bringing base funding nearly 6 percent below fiscal year 2011 levels.
• Michigan ’s Governor Snyder proposes a $470 per pupil cut to K-12 education spending.
• In Mississippi, Governor Barbour’s budget would fail — for the fourth year in a row — to meet the state’s statutory obligation to support K-12 schools, underfunding school districts by 11 percent or $231 million.  The statutory school funding formula is designed to ensure adequate funding for lower-income and underperforming schools. According to the Mississippi Department of Education, the state’s failure to meet that requirement over the past three years has resulted in 2,060 school employee layoffs (704 teachers, 792 teacher assistants, 163 administrators, counselors, and librarians, and 401 bus drivers, custodians, and clerical personnel).
• Governor Nixon of Missouri proposes freezing funding for K-12 education at 2011 levels. This would mean that for the second year in a row, the state has failed to meet the statutory funding formula established to ensure equitable distribution of state dollars to school districts.
• Nebraska’s Governor Heineman also proposes to freeze K-12 funding.  Funding would fall $200 million short of the state’s statutory funding formula.
• Governor Sandoval of Nevada calls for reducing K-12 funding by $270 per student, cutting teacher pay by 5 percent, and freezing merit and longevity pay for teachers (and other public employees).
• Governor Martinez of New Mexico proposes reducing K-12 funding by $30 million (1.5 percent) and sparing “classroom spending” from cuts, which would mean greater proportional cut to other areas of K-12 education, like school libraries and guidance counseling.  She also proposes a 20 percent cut in the general fund operating budget of the Public Education Department.
• New York ’s Governor Cuomo proposes a $1.5 billion, or 7.3 percent, cut to state education aid.  This cut would delay, for the third year in a row, implementation of a court order to provide additional education funding to under-resourced school districts. It would also come on top of a substantial education aid reduction in the current fiscal year.
• North Carolina ’s Governor Perdue proposes a 5 percent cut in state spending on pre-kindergarten for at-risk four-year-olds and a 5 percent cut to the state’s early childhood development network that works to improve the quality of early learning and child outcomes. Her budget would also shift responsibility for future school bus replacements to local governments and eliminate high school dropout prevention grants to local school agencies and organizations.
• South Dakota Governor Daugaard is calling for a 10 percent cut in K-12 funding. The cut is so large that the state’s largest school district says it would be unable to satisfy it even if it were to eliminate all school buses and remove all athletic and fine arts programs.
• Texas’s initial budget, produced by state’s Legislative Budget Board (the Governor is not required to produce an initial budget in Texas), would e liminate funding for pre-K programs that serve almost 100,000 mostly at-risk children — over 40 percent of the state’s pre-kindergarten students. The budget also would reduce K-12 funding to 23 percent below the minimum amount required by the state’s education finance law. Texas already has below-average K-12 education funding compared to other states, and this cut would depress that low level even further at a time when the state’s school enrollment is growing.  This would likely force school districts to lay off large numbers of teachers, increase class sizes, eliminate sports programs and other extracurricular activities, and take other measures that undermine the quality of education.
• Washington’s Governor Gregoire would take nearly $1 billion from education funds designed to reduce class size, extend learning time, and provide professional development for teachers. Gregoire also would eliminate early education for 1,300 three-year-olds.

This has been a major week for the funding of children’s programs in the federal budget. We want to give you a breakdown of what is being debated and what you can do to fight some of the bad decisions many in Congress want to make.

Background

On October 1^st of last year, the fiscal year 2011 began. The Congress did not pass a budget funding government programs. Instead they passed what is known as a “continuing resolution” that funds programs at essentially the same level they were in 2010. This resolution will expire on March 4^th. Congress needs to pass final legislation that will fund the government until September 30^th of this year. The fiscal year for 2012 will begin on October 1^st of this year.

What the Congress is Currently Considering

The House of Representatives recently proposed a series of cuts to the budget for this year. Last week we told you about how they proposed $32 billion in cuts – including to the Maternal and Child Health Block Grant, the Women Infants and Children’s (WIC) program, community health centers, poison control centers, and other children’s programs. This was not enough for some members of the House, particularly those who associate with the conservative “Tea Party” movement. On Friday night, a day and time known by government officials as the best to release information that they know will get the least amount of media coverage, the Appropriations Committee offered an addition $42 billion in cuts. These include:

• Head Start – $1 billion (15%) cut
• Community Health Centers – $1 billion cut
• Community Services Block Grant – $341 million cut
• Low Income Home Energy Assistance contingency fund – $390 million  cut
• Title I (K-12 education for low-income students) – $693.5 million cut
• IDEA (special education) grants to states – $560 million cut
• Special Supplemental Nutrition Program for Women, Infants & Children (WIC) – $747 million cut
• 21^st Century Community Learning Centers (after school programs) – $100 million cut
• Maternal and Child Health Block Grant – $50 million cut
• Child Care Development Block Grant – $39 million cut

Many other children programs will be eliminated entirely. Some examples include:

• Teen Pregnancy Prevention Grants
• Mentoring Children of Prisoners
• Even Start
• Striving Readers
• High School Graduation Initiative
• Student Aid – for higher education
• LEAP program (for low-income college students)

The House could include even more cuts as they debate this resolution.

These cuts are wrong on many levels. They harm children at a vulnerable time in their development. The economy remains in recession and an all-time record number of children (14,567,000) currently live in poverty. Cuts like this would mean that 368,000 low income 3 and 4 year olds would lose the education and nutrition program they receive at their Head Start center. The education cuts, along with others being made in states, would leave thousands of teachers out of jobs this year. Many in Washington say these cuts are needed to reduce the deficit. However, these cuts would take only 2% off this year’s projected deficit. So essentially, these cuts harm children and don’t solve America’s fiscal challenges.

What You Can Do

Contact your member of the House and Senators and tell them you oppose these cuts and why. They will listen to you. The original House proposal included a $210 million cut to the Maternal and Child Block Grant. When they heard from people opposed to this, the Republicans reduced their cut to $50 million. Many are not fully supportive of all these cuts. When they reduce these cuts, they are showing just how much discomfort they have. Click here to contact your representatives. Some suggestions when you get a hold of someone in their office:

• Tell them that Congress needs to start budgeting like real families and put our nation’s kids first! Please stop these harmful proposed cuts to programs that are essential for our nation’s economic future.
• Remind them that scientific research and leading economists have said for years that investing in children is one of the smartest investments we can make. We need more investments in the health, safety, and education of children, not mindless cuts.
• Ask them what they would say to the 4 year old in their district or state who is forced out from their Head Start program.

What Happens Next

Even if the House of Representative passes all of these cuts to the budget for this year, the Senate has their say as well. Senator Daniel Inouye of Hawaii, the chairman of the Senate Appropriations Committee, has slammed these cuts, saying “they would impede the federal government from completing even its most core functions.” President Obama has threatened to veto these cuts. This debate will continue throughout the year.

At some point, Congress will begin debating the budget for next year. This week, President Obama released his budget for 2012. Overall, it contains a small increase to children’s programs. Not all programs receive an increase. The President proposed cuts in juvenile justice, heating assistance for low-income families, and community service programs. He makes up for this with increases in Head Start, afterschool programs, child nutrition, child health, and education programs. We will let you know much more about this proposal for next year, but the main business in Washington is to fight the cuts the House want to make to children’s programs right now.

According to a recent report by our friends at the Center on Budget and Policy Priorities, a number of Republican governors, citing state budget problems, have asked Congress to repeal these “maintenance of effort” provisions so that they can reduce Medicaid and State Child Health Insurance Program (S-CHIP) expenditures by covering fewer people.

The Affordable Care Act requires states to maintain their current Medicaid and Children’s Health Insurance Program eligibility standards until 2014, when new, nationwide Medicaid eligibility standards take effect and state-based health insurance exchanges will begin operating.

Repealing the maintenance-of-effort provision would almost certainly result in a sharp increase in the number of Americans who are uninsured, as states scale back eligibility for low-income children, parents, seniors, and/or people with serious disabilities — the principal groups of people whom Medicaid covers.  During the recession of the early 2000s, some 34 states cut back Medicaid and CHIP eligibility — causing 1.2 million to 1.6 million low-income adults and children to lose coverage — before Congress acted to prevent states from making further eligibility cuts as a condition of receipt of federal fiscal assistance enacted in 2003.

State budget shortfalls are substantially larger today than in those years; states face estimated shortfalls of about $125 billion for state fiscal year 2012, which begins on July 1 in most states.  In addition, many governors have said they oppose any revenue increases to help close these shortfalls, despite the magnitude of the budget gaps.  If the maintenance-of-effort provision is repealed now, the number of low-income Americans cut off Medicaid and cast into the ranks of the uninsured will likely far outstrip the number who lost insurance in the early 2000s.  Arizona alone is seeking to end Medicaid coverage for 280,000 people.

Large numbers of children could lose coverage. Most states do not cover large numbers of parents and childless adults.  Should the maintenance-of-effort provisions be repealed, these states likely would curtail eligibility for children (and seniors and people with disabilities) since that is the only way they could generate substantial savings by curtailing Medicaid eligibility. All states cover children with incomes above Medicaid’s minimum eligibility levels, either through Medicaid or CHIP.  Almost every state covers children with incomes up to 200 percent of the poverty line.  Most cover children with incomes up to at least 250 percent of poverty.

These eligibility standards have produced strong results.  They kept the number and percentage of children who were uninsured from rising in 2009 despite the severe recession.  The proportion of children covered by Medicaid and CHIP increased by 3.5 percentage points in 2009, offsetting a comparable percentage decline in employer coverage for children.

This is going to be a dangerous year for children and families who receive government services. They face attack on many fronts – the budget cuts proposed by House Republicans at the federal level, and budget cuts proposed by Governors to K-12 education, higher education, and other children’s and youth programs.

Democracy Corps, a project of political consultants James Carville and Stan Greenberg, released a poll this week that shows voters strongly opposed to budget cuts being proposed by House Republicans. The chart below shows opposition to these cuts when voters learn about the impact on children, youth, women, and families.

How much more simple can this be? Voters do support the idea of cutting $32 billion from the federal budget in the abstract (50% favor-33% oppose). However, when they learn about specific cuts being proposed, support collapses. 50% are opposed (a gain of 17 points) with only 43% in favor. Voters need to know what the House Republican leadership wants to do. It is the only way to stop these stupid and short-sighted cuts.

The health care reform last year was designed to benefit children and families immediately by banning insurance companies from denying coverage to children with pre-existing conditions and requiring insurance companies to allow parents to keep their children on their plan until they turn 26. However, insurance companies are finding ways to get around the intention of the law.

The requirement that children under 19 be granted insurance regardless of preexisting conditions has caused Blue Cross and Blue Shield of Florida and many other insurers to stop offering child-only coverage.

Insurers fear they will lose money because parents might sign up for coverage only when their children become sick. That is scheduled to change in 2014, when the law requires that virtually everyone have health insurance.

On the other hand, there is little challenge to requiring employers to insure employees’ children up until the age of 26. They believe cost increases will be minimal.

Insurance companies believe that families have an incentive to not have their children covered until they become sick. Blue Cross Blue Shield of Florida still covers all children when families sign up for policies, but has stopped offering the individual child policies. Their Vice President of Regulatory Affairs said she has heard that insurers in 29 states have stopped offering kids-only policies.

“Some people believe that insurers make money by avoiding sick people,” said Alan Sager, a healthcare policy expert at Boston University. But he said he also understands insurers’ fear of accepting all children before the 2014 mandate requires almost everyone to get insurance. Tackling a single piece of reform “in isolation” can be difficult, he acknowledged.

This all shows that the road towards universal coverage for children will be a long one. Even regulations requiring insurance companies to cover children with pre-existing conditions does not mean they will until the federal government closes all loopholes that would allow them to do this. On the positive side, we are happy to see that extending coverage to those between 18 and 26 on their parents’ plan is noncontroversial and being implemented across the country.

A program that helps low-income Americans afford energy, particular during the type of harsh winters many are experiencing in different parts of the country, is poised to be used as a political football. On Wednesday, the National Journal reported that President Obama’s proposed 2012 budget will cut several billion dollars from the Low Income Home Energy Assistance Program. The program would see funding drop by about $2.5 billion from an authorized 2009 total of $5.1 billion.

In 2010, Obama’s omnibus budget resolution assigned roughly $5 billion in LIHEAP grants for 2011. According to the National Journal, the rationale was that at a time of acute economic crisis and rising commodity prices, a little federal assistance to those in need was politically defensible.

On Wednesday, the House Appropriations Committee proposed a $400 million cut to the program. Both sides are playing silly political games with this program. Last year, when President Obama proposed a $1.8 billion cut to the program (from $5.1 billion in 2010 to a proposed $3.3 billion level) before agreeing to $5 billion in the omnibus spending bill that currently funds the government for this year. While the President is presenting this as a “tough cut” needed to show his intent to “control spending”, he is not offering anything different than he offered last year. And the House Republicans are offering $32 billion in budget cuts to “reduce the deficit”, cuts including the LIHEAP program, their plans reduces the deficit by less than 2% this year (a deficit slated to be $1.5 billion).

It is reasonable for America’s children and families to expect an honest debate about their needs and the government’s responsibility to provide services. Instead, they are getting spin and intellectual dishonesty from Washington DC where proposals have nothing to do with what they actually need and should expect to receive from their government. The proposals also do not accomplish what those proposing them say they will do. Expect this to continue throughout the year.

As part of their effort to cut $32 billion dollars from this year’s budget, the House Appropriations Committee previewed a series of cuts they plan to make. Programs for children and pregnant women feature prominently in these cuts along with cuts to local law enforcement, clean water, poison control, and many other programs that protect the safety of American’s food, water, and property. While House GOP’s are stepping up efforts to roll back reproductive rights, one has to assume they really believe that government’s obligation to children ends at conception. Some lowlights:

• $758 million* cut from the Women, Infants, and Children (WIC) program. WIC provides Federal grants to States for supplemental foods, health care referrals, and nutrition education for low-income pregnant, breastfeeding, and non-breastfeeding postpartum women, and to infants and children up to age five who are found to be at nutritional risk.

• $210 million cut to Maternal and Child Health Block Grants. The Maternal and Child Health Block Grant to States is a public health program that reaches across economic lines to improve the health of all mothers and children … train providers and support services for children with special healthcare needs, newborn screening and genetic services, lead poisoning and injury prevention, and health and safety promotion in child care settings.

• $1.3 billion cut to Community Health Centers, $480 million of which is devoted to children. These centers are designed to improve the health of the Nation’s underserved communities and vulnerable populations by assuring access to comprehensive, culturally competent, quality primary health care services.

• $400 million cut from the Low Income Heating Energy Assistance Program Contingency Fund (LIHEAP), $150 million of which is devoted to children. LIHEAP assists low income households, particularly those with the lowest incomes that pay a high proportion of household income for home energy, primarily in meeting their immediate home energy needs. This winter has been particular cold in the northeast and southwest, and families will likely be denied assistance from this program. The federal government will also not be able to respond with assistance in case of future weather crises this winter.

• $27 million cut to poison control centers, $17.5 million of which is devoted to children. There are 57 poison control centers in the United States.  Together they provide free, 24-hour professional assistance to anyone in the 50 states. All calls to a poison center are answered by a medical professional trained to answer questions about poisons. By answering calls to this phone number, poison centers provide immediate poison exposure management instructions.

• $2.3 million cut in juvenile justice programs. The Office of Juvenile Justice and Delinquency Prevention supports efforts to protect public safety, hold offenders accountable, and provide services that address the needs of youth and their families.

These cuts are simply idiotic. They will not make children smarter, healthier, or safer. They represent the failure of adults in Washington to make smart choices about the future. Congress and the Obama Administration reached a deal to add $400+ billion to the deficit by extending the Bush tax cuts. It’s irresponsible to cut these programs to pay for these tax cuts.

* These cuts are measured from President Obama’s 2011 budget proposal. In some cases the amount requested for the program is higher than the funding level for 2010 and what is currently being funded through through the continuing resolution process currently in place. The President’s budget does not represent anything other than the desires of the President since any spending authorization must be introduced in the House. So not only are the Republicans cutting vital programs for children, they are also lying to their supporters by implying the total amount of their cuts represent their campaign promises. They don’t.

We have noted the states cuts being proposed by Governors across the country. Today, we are going to look at some of the health care, mental health, and child care cuts Governors are offering. Both at the federal level and the state level, children are being asked to pay for the mistakes made by adults. Education, health care, and safety programs have been cut consistently for years now in states and various members of Congress are proposing federal cuts that will dramatically reduce these programs as well. State cuts being proposed include:

• Arizona – Governor Brewer is proposing eliminating Medicaid coverage for 280,000 people, more than 4 percent of the state’s population, including children.

• California – Governor Brown is proposing scaling back the state’s Healthy Families (CHIP) program by eliminating vision benefits, increasing premiums for families with incomes between 150 and 250 percent of poverty, and increasing co-payments, among other cuts. Brown also proposes cutting $750 million from child care programs, in part by reducing subsidies by 35 percent and requiring recipients to have incomes less than 60 percent of the state’s median income (down from 75 percent of the median income today).   The Governor’s proposal would reduce the number of subsidized childcare slots by about 9,900, or 3 percent.

• Delaware – Governor Markell would eliminate a General Assistance program that provides cash assistance to people in deep poverty and who are often homeless. This includes families with children.

• Georgia – Governor Deal proposes cuts to several areas of Medicaid and children’s health. Children’s services would be subject to co-pays for the first time. Governor Deal is also proposing funding subsidized child care at a level that would reduce the monthly number of children served by as many as 10,000 and create a waiting list of up to 4,000 children.

• Kansas – Governor Brownback is proposing eliminating funding for mental health services for 850 families of children with severe emotional disturbances.

• Texas – The state’s initial budget proposal would cut Medicaid provider rates by 10 percent, making it more difficult for Texas doctors to accept Medicaid patients because of the state’s low reimbursement levels relative to other states, further restricting low-income Texan children’s access to health care.

• Washington – Governor Gregoire’s budget proposes eliminating a health program for 27,000 undocumented children.

On Friday, we noted the cuts Governors are making to K-12 education as a result of budget shortfalls in their states. These are continuation of cuts states have made for several years now since the economic slowdown began in 2007. Today we are going to look at cuts being proposed in higher education. While not impacting children directly, these cuts will make it harder for today’s children to get affordable higher education and will harm our economy in the future. Higher education cuts being proposed include:

• Arizona - Governor Brewer is proposing cutting funding for public universities by one-fifth, or $170 million. This would add to deep previous cuts:  from 2008 through 2011, state support for universities fell by $230 million, resulting in the elimination of more than 2,100 positions (an 11 percent reduction in the workforce).  Universities have raised tuition significantly, closed eight extended campuses, and merged, consolidated, or disestablished 182 colleges, schools, programs, and departments.  Combined with those previous cuts, Brewer’s proposal would bring per-student state funding down to 46 percent below pre-recession levels. Governor Brewer is also proposing to cut community college funding for operating expenses by about $73 million. The cut amounts to 6.2 percent of total community college operating revenues and half of all state support for community colleges.

• California – Governor Brown is proposing significant cuts to higher education.  He would increase fees at community colleges by 38 percent; for the average student, this would mean an annual fee increase of $300.  He is also proposing to reduce funding for the University of California (UC) and the California State University (CSU) systems by $1 billion ($500 million each).  Both the UC and CSI systems already have been cut deeply since the recession struck; the governor’s proposal would reduce UC funding to levels last seen in the 1998-1999 fiscal year, when the system had 73,600 (31 percent) fewer students than it does today, and would reduce CSU funding to levels last seen in the 1999-2000 fiscal year, when the system had almost 70,000 (16 percent) fewer students than it does today.

• Georgia - Governor Deal’s budget would cut funding for a popular merit-based college scholarship program by about one-third, cut university funding by 10 percent, and cut funding for technical colleges by 6 percent.

• Iowa – Governor Branstad is proposing state support for public universities that is 6 percent below FY11 levels, which the state Board of Regents say may result in higher tuition, larger classes, and more teaching assistants and adjunct faculty teaching undergraduate courses.

• Missouri – Governor Nixon is proposing cutting state support for higher education by 7 percent, which has led the state’s university system to propose tuition hikes for next school year ranging from 4.7 percent to 6.6 percent.  The proposed cuts would continue a trend of declining state support for Missouri’s universities; over the last decade, state support has fallen 28 percent.

• Nevada – Governor Sandoval would reduce the state funding for higher education by 18 percent and give the Board of Regents full discretion over raising tuition to make up for the loss in funds.

• New Mexico – Governor Martinez is proposing a 5 percent cut in funding for public universities.

• New York – Governor Cuomo is proposing cutting state support for the State University of New York (SUNY) system by 9.1 percent and reducing state support for the City University of New York (CUNY) system by 5.2 percent.  These reductions would come on top of substantial cuts in previous years, which have resulted in (among other consequences) a 14 percent SUNY tuition increase.

• Oregon – Governor Kitzhaber is proposing cutting state funding for community colleges per full-time student by 11 percent, to $1,559 from $1,744. The governor is also proposing cutting state support for the Oregon University System by 4.9 percent from FY 2009-2011 levels, and recommends giving university graduate and professional programs more flexibility in raising tuition.

• Texas – The state’s budget would cut public college and university funding by 16 percent, likely forcing tuition increases, reductions in course offerings, and layoffs.  The budget would also cancel funding for four community colleges, and it would eliminate financial aid awards for new students under the Texas Grant program, which combines state and institutional money to cover tuition and fees at public schools for 87,000 students with financial need and good academic records.

• Washington – Governor Gregoire is proposing cutting state funding for colleges and universities by $345 million and allowing them to make up for most of this loss through tuition increases. She is also proposing reducing by 2,800 the number of students receiving state work-study funds.