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Published: Friday, March 2, 2007

Big budget squeeze: Poor, uninsured on the outside again

By Nancy Frazier O'Brien

As Congress begins its deliberations over President George W. Bush's fiscal year 2008 budget, you might think that decision-making power rests solely with the president who proposed it and the representatives and senators who will approve it.

But many of the most critical decisions were made long ago, by members of Congress who could be long dead, according to Eugene Steuerle, a senior fellow at the Urban Institute in Washington and a consultant to the U.S. bishops' Committee on Domestic Policy.

Those earlier senators and representatives made "promises in law that now we can't fulfill," Steuerle told Catholic News Service Feb. 21. And for today's politicians who want to be known for giving their constituents more and keeping taxes low, "it's very, very hard politically" to make the tough decisions that are needed, the economist added.

More than half of Bush's proposed $2.9 trillion budget goes to Social Security (21 percent); Medicare and other health programs (22 percent); and income security programs such as retirement and disability payments to federal employees, unemployment compensation and housing and nutrition assistance programs (10 percent). Most of those expenditures were fixed by earlier legislation and are mandatory.

Add to that the 9 percent of the total budget that must go to pay interest on the deficit and the 21 percent allocated to defense programs, and there's not much left for education, social services, jobs programs, transportation, services to veterans and other needs.

"The squeeze is on now" as mandatory spending increases and discretionary spending drops, Steuerle said. "And in 10 years there'll be nothing left over" for discretionary spending because the mandatory outlays will exceed what the government is taking in.

"It makes no more sense to commit future economic resources than it would be to decide today where to station troops until the next millennium," Steuerle said in testimony before the Senate Budget Committee a few days before Bush's budget was made public in early February.

"Only major systemic reform can restore a normal democratic process," he added. "Each generation must regain the right to decide spending and tax priorities based on the nation's current needs, not on past anticipation."

The budget proposal drew strong criticism from the presidents of the Catholic Health Association and Catholic Charities USA, who mourned what they said were missed opportunities to improve the plight of the poor and the uninsured.

"The president's new budget hurts those living in poverty at a time when we should be doing even more to help the most vulnerable among us," said Father Larry Snyder, president of Catholic Charities USA, in a statement. "America needs to strengthen vital social service programs to help those in need, not weaken those programs."

Father Snyder said the "most alarming cuts" would reduce housing assistance to the elderly and disabled, drop approximately 300,000 people in working families with children from the Food Stamp program, cut block grants to states for community services that aid the poor and sharply reduce the amount available to help low-income people pay their home heating costs.

"At a time when our nation is experiencing an ever widening gap between those who have resources and those who do not, we are disappointed that the president's proposal does not go far enough to address the basic needs of those who live in poverty," he added.

The budget also proposes cutting more than $100 billion from Medicaid, Medicare and other health programs over the next five years. Those cuts "will impact some of the most vulnerable Americans, including seniors, low-income children and the disabled," Father Snyder said.

Sister Carol Keehan, a Daughter of Charity who is CHA president and CEO, said the budget proposals outlined by Bush "simply do not rise to the challenge of helping to improve our nation's health care system."

"It is particularly disappointing that the administration did not take advantage of the required reauthorization of the State Children's Health Insurance Program this year to propose measures to expand the program to the nearly 9 million children who remain uninsured," she said in a statement.

"Given the focus on SCHIP, as well as the glaring moral failure of allowing any child in our nation to go without access to health care, the Catholic health ministry strongly believes that today we enjoy a unique opportunity to make coverage for all children a priority and a reality," she added.

Sister Carol also said the proposed cuts to Medicaid and Medicare "would only hinder the ability of hospitals to care for low-income and other vulnerable populations."

"Balancing the budget is a notable and worthwhile goal," she said. "But as a reflection of our nation's values and priorities, no budget should be based on sacrifices from those least able to afford them, nor should it squander the real opportunity we have at this time to expand access to health care."

---CNS



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