Topic Overview. Table of Contents. History of Government Social Services in the United States

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1 Topic Overview Resolved: The United States federal government should substantially increase social services for persons living in poverty in the United States. I. Introduction Table of Contents II. The Magnitude of the Problem A. Government Measures of Poverty 1. Thresholds 2. Guidelines B. Could the Measures be Improved? C. The Severely Poor D. Reforms E. Defining Poverty III. IV. What Are Social Services? History of Government Social Services in the United States A. Early Social Services B. The Great Depression and the New Deal C. The War on Poverty D. Welfare Reform in the 1990s E. The 2009 American Recovery and Reinvestment Act of 2009 V. Overview of Current Social Services A. Supplemental Security Income B. Temporary Assistance to Needy Families C. Title XX Social Services Block Grant Program 1

2 D. Supplemental Nutrition Assistance Program E. Medicaid F. State Children s Health Insurance Program G. Refugee Assistance H. Supplemental Nutrition Program for Women, Infants and Children I. National School Lunch Program J. Child Care Development Block Grant VI. Understanding Poverty and the Role of Social Services A. Two Views of Poverty B. A Third View of Poverty VII. Affirmative Case Areas A. Service Focused Cases 1. SCHIP 2. Savers Credit 3. Medicaid B. Target Population Cases 1. Single Parents 2. Native Americans C. Harms Focused Cases 1. Smoking 2. HIV D. Reform Cases 1. Taxpayer Choice 2

3 2. Enterprise Programs VIII. Major Negative Arguments A. Topicality: Poverty B. Solvency Takeout: Extent of Poverty C. Private Action Counterplan D. Spending Disadvantage E. State Counterplan F. Capitalism G. Dependency Disadvantage H. Waste/Fraud Disadvantage I. Disincentive to Work and Save Disadvantage J. Inherency Introduction This year s debate topic focuses on the problem of poverty in the United States. Poverty impacts a large number of Americans. According to the 2007 Census, 12 percent of Americans approximately 37 million people now live below the federal poverty line. 1 These numbers are only likely to climb higher in the current economic climate. 2 This year s debate topic will give you the opportunity to discuss numerous issues related to the topic such as the cause of poverty in the United States, the magnitude of the problem and the best solutions. The Magnitude of the Problem 1 U.S. Census Bureau, Income Poverty and Health Insurance Coverage in the United States: 2007, Released August [ 235.pdf] 2 Shobhana Chandra and Timothy R. Homan, U.S. Initial Jobless Claims Rose to 667,000 Last Week, Bloomberg, February 26,

4 Determining how many people live in poverty depends on which poverty measure you choose. Government Measures of Poverty. The federal government uses two measures of poverty that differ slightly: poverty thresholds and poverty guidelines. 3 Thresholds. The federal government thresholds are the original version of the federal poverty measure. This measure was developed in the 1960s by Mollie Orshansky, an economist with the Social Security Administration. 4 Orshansky relied on 1955 U.S. Department of Agriculture research that concluded families spent approximately one-third of their budget on food. Borrowing the U.S.D.A s estimated cost for a basic diet (called the Thrifty Food Plan), she tripled it to arrive at the federal poverty threshold theoretically, the amount of money an average four-person family needs for food, clothing and shelter. The thresholds are adjusted annually for inflation and are used for mainly statistical purposes, such as for reporting how many persons live in poverty for the Census report. 3 Methodological Issues, Institute for Research on Poverty. 4 Sean Shurtleff, Reforming the U.S. Poverty Standard, Brief Analysis No. 640, National Center for Policy Analysis, January 20,

5 United States Poverty Thresholds Related children under 18 Size of Family Unit Wieghted Average Threshold None or more One person (unrelated individual) 10,590 Under 65 years 10,787 10, years or older 9,944 9,944 2 people 13,540 Household under 65 years 13,954 13,884 14,291 Household 65 years or older 12,550 12,533 14,237 3 people 16,530 16,218 16,689 16,705 4 people 21,203 21,386 21,736 21,027 21,100 5 people 25,080 25,791 26,166 25,364 24,744 24,366 6 people 28,323 29,664 29,782 29,168 28,579 27,705 27,180 7 people 32,233 34,132 34,345 33,610 33,098 32,144 31,031 29,810 8 people 35,816 38,174 38,511 37,818 37,210 36,348 35,255 34,116 33,827 9 people or more 42,739 45,921 46,143 45,529 45,014 44,168 43,004 41,952 41,691 40,085 Source: U.S. Census Bureau Guidelines. The poverty guidelines are the other federal poverty measure. The guidelines are issued by the Department of Health and Human Services and are designed to simplify the thresholds for administrative purposes. The numbers are adjusted for families of different sizes and used to determine who qualifies for Medicaid, the Supplemental Nutrition Assistance Program, community programs, and other services. 5

6 United States Department of Health and Human Services 2008 Poverty Guidelines Persons in Family or Household For each additional person, add 48 Contiguous States and D.C. Alaska Hawaii 1 $10,400 $13,000 $11, ,000 17,500 16, ,600 22,000 20, ,200 26,500 24, ,800 31,000 28, ,400 35,500 32, ,000 40,000 36, ,600 44,500 40,940 3,600 4,500 4,140 SOURCE: Federal Register, Vol. 73, No. 15, January 23, 2008, pp Changes in Measured Poverty Over Time. Census Bureau household data show: In 1968, the official poverty rate was 12.8 percent, meaning 25.4 million people were considered poor. In 2007, the poverty rate was 12.5 percent, and 37.3 million people were considered poor. However, household consumption indicates that basic living standards have improved significantly. For instance: In 1970, only 36 percent of the entire U.S. population had air conditioning, compared to nearly 80 percent of poor households in 2005, according to a 2007 Heritage Foundation study. In 1980, only 27 percent of the poor had microwave ovens compared to 85 percent in 2005, according to University of Chicago Professor Bruce D. Meyer. 6

7 A country s poverty rate should decline as real incomes rise and living standards increase, but the U.S. poverty rate has remained stagnant even though standards of living have increased. This increased consumption shows that the living standards of low-income families have improved. In fact, according to the U.S. Department of Labor, the poor actually consume about $2 for every $1 of reported income. How is that possible? The discrepancy is due to unreported or underreported income, savings credit and welfare benefits. Could the Measures be Improved? The government measures have widely acknowledged flaws. 5 Some argue that the current poverty level is too high. 6 The current poverty standards only measure families gross income, which includes before-tax wages, but not capital gains. Goss income also includes cash welfare assistance, but excludes more valuable noncash benefits, such as Medicaid and public housing. Noncash benefits can be substantial without affecting measured poverty. According to Cato Institute scholar Michael Tanner, the federal government spent an estimated $12,892 per poor person on antipoverty programs in The Heritage Foundation estimates that the federal government spent $8.29 trillion on antipoverty programs from 1965 to 2000, mostly in the form of noncash benefits. These benefits raise the living standards of millions of low-income people, but do not count as income; therefore, they do not reduce measured poverty. This is the main reason the poverty rate has remained stagnant. Other economists such as Ellen Frank, argue that the poverty measure is too low as families spend much less of their total budget on food than they did when the measure was 5 Nancy Cauthen, Testimony on Measuring Poverty in America, Testimony before the House Subcommittee on Income Security and Family Support, Committee on Ways and Means, August 1, Sean Shurtleff, Reforming the U.S. Poverty Standard, Brief Analysis No. 640, National Center for Policy Analysis, January 20,

8 established. 7 Instead of spending one-third of their budgets on food, today s families spend closer to one-fifth of their budgets on food, according to Frank. Columbia University s Mailman School of Public Health estimates the percentage spent on food even lower, at one-seventh of the family budget. 8 According to these groups, families spend more on nonfood necessities such as child care, health care, transportation, and utilities today than they did 50 years ago, for obvious reasons: mothers entering the workforce, suburbanization, and rising health care costs, for example. Because of this, those living in what the government defines as poverty have decreased discretionary income that can go to fewer items or services, because costs for utilities, child services, and others have significantly risen. The implication of this development, in the minds of some scholars, is primarily that the measure for poverty should be increased to reflect the increased costs of nonfood necessities. In addition, many scholars note that federal poverty statistics do not account for the regional differences in costs such as housing, transportation, and utilities. 9 Housing costs vary widely across the country, so that an income that might be barely adequate in Mississippi is wholly inadequate in Massachusetts. Yet federal poverty figures make no adjustment for regional differences in costs and advocate using a poverty measure that accounts for these differences. The Severely Poor. Others argue that the numbers that matter are the severely poor. While the number of people in poverty has remained relatively stable in the recent past, there has 7 Ellen Frank, Dollars & Sense, The Magazine of Economic Justice, January/February Nancy Cauthen and Sarah Fass, Measuring Poverty in the United States, National Center for Children in Poverty, Columbia University Mailman School of Public Health, June Diana Pearce, Self Sufficiency Standards, Basic Family Budget, Wider Opportunities for Women and the Economic Policy Institute. 8

9 been an alarming growth of the number of people living in abject, or severe, poverty. 10 The abjectly poor in America are individuals living on $5,250 per year. This level of poverty, in comparative terms, is only slightly above the poverty line originally set in the 1960s and affords a person little more than food and shelter, if that. According to recent Census estimates, the population percentage considered severely poor has reached a 32 year high. Between 2000 and 2005, the percent living at half of the poverty-level income increased by 26 percent. In 1975, the severely poor were 30 percent of the population in poverty. Today 43 percent of persons in poverty are severely poor by national standards. While the rate of new entrants moving into poverty is somewhat stable, those who are becoming truly poor are increasing at a rate 56 percent higher than the growth rate of new entrants into poverty. 11 Reforms. Many scholars support two fundamental reforms to the poverty standard that were proposed by the National Academy of Sciences (NAS). 12 In its 1995 report, Measuring Poverty, the NAS proposed adjusting the income data by adding any government welfare benefits received and subtracting taxes, health care spending and work-related expenses. The adjustments would improve the accuracy of the poverty standard. 13 The NAS also recommended linking U.S. poverty thresholds to approximately 80 percent of the median (average) amount families spend on food, clothing and shelter. However, tying the poverty standard to spending would change it from an absolute measure to a measure of relative consumption. 10 Amy Glasmeier, Poverty in America, The Nation We Have Become, Penn State University, February 26, [ nation we%e2%80%99ve become/] 11 Ibid. 12 David Betson, Constance Citro, Robert Michael, Recent Developments for Poverty Measurement in U.S. Official Statistics, Journal of Official Statistics, Sean Shurtleff, Reforming the U.S. Poverty Standard, Brief Analysis No. 640, National Center for Policy Analysis, January 20,

10 Some believe this would have several negative impacts. First the poverty rate would rise immediately: Data from a 2005 Census Bureau report showed that the NAS model would have raised the 2002 poverty rate by 1.1 percentage points, or 3.1 million people. Classifying 3.1 million more people as poor would cost the government an extra $40 billion every year, according to Tanner s estimate. Second, the revised poverty rate would continue to rise because family incomes, and therefore consumption spending, grow faster than inflation. For instance, consumer spending grew an average of 44 percent faster than inflation from 2000 to Finally, a relative measure would always classify a percentage of the population as poor, encouraging further efforts to redistribute income. American Enterprise Institute scholar Douglas J. Besharov has proposed another, poverty standard. 14 He does not endorse tying the poverty threshold to relative spending, but he would increase it 15 percent to account for the increase in real median income since He also proposes a few other adjustments: In 1995, the federal government determined that the old Consumer Price Index (CPI) overstated inflation by as much as 23 percent. Using newer CPI measurements for the poverty standard would lower the number of Americans considered poor by 7.8 million people. In 2001, according to Besharov, $804 billion of income was not reported by households or counted by the IRS. Accounting for this unreported income would reduce the number of poor by 4.7 million people. 14 Douglas Besharov, Measuring Poverty in America, Testimony before the Subcommittee on Income Security and Family Support, August

11 In 2004, says Besharov, the federal government spent almost $7,500 per poor person on their health care. Counting these expenditures as income to the poor would cut their ranks by 3.2 million. With all these adjustments, the poverty rate in 2004 under Besharov s model would have been only 8.1 percent, rather than the official rate of 12.7 percent. Defining Poverty. Below are additional definitions of poverty you may want to consider as you research this topic: Encyclopedia Britannica 2008 The state of one who lacks a usual or socially acceptable amount of money or material possessions. Poverty is said to exist when people lack the means to satisfy their basic needs. In this context, the identification of poor people first requires a determination of what constitutes basic needs. These may be defined as narrowly as "those necessary for survival" or as broadly as "those reflecting the prevailing standard of living in the community." The first criterion would cover only those people near the borderline of starvation or death from exposure; the second would extend to people whose nutrition, housing, and clothing, though adequate to preserve life, do not measure up to those of the population as a whole. The problem of definition is further compounded by the noneconomic connotations that the word poverty has acquired. Poverty has been associated, for example, with poor health, low levels of education or skills, an inability or an unwillingness to work, high rates of disruptive or disorderly behaviour, and improvidence. While these attributes have often been found to exist with poverty, their inclusion in a definition of poverty would tend to obscure the relation between them and the inability to provide for one's basic needs. Whatever definition one uses, authorities and laypersons alike commonly assume that the effects of poverty are harmful to both individuals and society. 11

12 American Heritage Dictionary of the English Language, 2006 The state of being poor; lack of the means of providing material needs or comforts. Scottish Poverty Information Unit Poverty is defined relative to the standards of living in a society at a specific time. People live in poverty when they are denied an income sufficient for their material needs and when these circumstances exclude them from taking part in activities which are an accepted part of daily life in that society. The World Bank Organization The most commonly used way to measure poverty is based on incomes. A person is considered poor if his or her income level falls below some minimum level necessary to meet basic needs. This minimum level is usually called the "poverty line". What is necessary to satisfy basic needs varies across time and societies. Therefore, poverty lines vary in time and place, and each country uses lines which are appropriate to its level of development, societal norms and values. Poverty is hunger. Poverty is lack of shelter. Poverty is being sick and not being able to see a doctor. Poverty is not having access to school and not knowing how to read. Poverty is not having a job, is fear for the future, living one day at a time. Poverty is losing a child to illness brought about by unclean water. Poverty is powerlessness, lack of representation and freedom. Poverty has many faces, changing from place to place and across time, and has been described in many ways Most often, poverty is a situation people want to escape. So poverty is a call to action -- for the poor and the wealthy alike -- a call to change the world so that many more may 12

13 have enough to eat, adequate shelter, access to education and health, protection from violence, and a voice in what happens in their communities. The International Conference on Population and Development A variety of ways to define urban poverty are available, each with their own strengths and deficiencies: o income-based definitions: This approach seeks to specify a level of income per capita in a household below which the basic needs of the family cannot be satisfied. It shares the difficulties of the next class of definitions of imposing an official's or observer's view of necessities. It does not acknowledge variation in costs of similar goods for different consumers. The vital importance of non-market household production and non-monetarized exchanges in poor families is not counted. o basic needs approaches: A set of minimal conditions of life, usually involving the quality of the dwelling place, degree of crowding, nutritional adequacy and water supply are specified and the proportion of the population lacking these conditions is used to estimate the degree of poverty. The advantage of this approach is that different conditions can be specified appropriate to different settings. However, this reduces comparability of estimates in different sites. Similarly, it does not take into account the willingness of people to accept various tradeoffs deliberately (e.g., a lower quality dwelling for reduced transportation time and expense to work). 13

14 o participatory definitions: In this approach, respondents from communities are themselves invited to identify their perceptions of their needs, priorities and requirements for minimal secure livelihood. Some sacrifice of comparability of estimates in different communities or at different times is traded for better information on the identified demands of the individuals themselves. At times such analyses supplement and reinforce the more quantitative measures; at other times they reveal a very different experienced reality. A study in Rajasthan, India, identified 32 conditions which individuals felt necessary for a satisfactory minimal lifestyle. Comparison of interview results over a decade revealed that despite reductions in income of the residents, and little change in living conditions of the kind generally surveyed in basic needs estimates, significant improvements had occurred in experienced quality of life. You should consider several factors as you choose the definition of poverty that works best with your arguments. You may want to use a different definition when you are affirmative than when you are negative. When you are affirmative you may want to topically affect a large number of people with your social service so you choose an expansive definition or measure of poverty. Perhaps you will choose to account for cost of living differences between cities that may make the poverty level inadequate in some areas of the country. If you are negative, you may want to use a more narrow definition that will allow you to argue that the affirmative team is extra-topical, meaning they are assisting people above, as well as below, the poverty line. Other teams will choose a definition that allows them to discuss more critical arguments such as a poverty of the spirit. What Are Social Services? 14

15 The resolution asks affirmatives to increase social services to persons living in poverty. A key issue in debates this year will undoubtedly be what qualifies as a social service. For example, a case that expands Temporary Assistance for Needy Families (TANF) would be considered topical under some definitions, but by other definitions, it would clearly be considered a monetary payment, not a service. The following are definitions you may want to consider before writing your case: BusinessDictionary.com, 2007 Benefits and facilities such as education, food subsidies, health care and subsidized housing provided by a government to improve the life and living conditions of the children, disabled, the elderly and the poor in the national community. Merriam Webster Online Dictionary, 2008 An activity designed to promote social well-being; specifically organized philanthropic assistance. OECD, Glossary of Statistical Terms, 2008 Social and collective services provide final consumption for households and are distinctive for their non-market character in most OECD countries. Collective consumption decisions and public financing are common, as is production by governments, non-profit organizations and subsidized private organizations. Social services comprise the following International Standard Industrial Classification subgroups: government proper (civil or military); health services; educational services; miscellaneous social services. History of Government Social Services in the United States 15

16 The debate over what social services mean and who should receive them has waged for years in the United States. To determine how to best increase social services in your case, you first need to understand the history of social services in the United States. Early Social Services. The first social services in the United States were imported from the British Poor Laws. 15 Poor Laws established three classes of poverty. First was the impotent poor who were incapable of self-sufficiency because of their age, disability or other condition. This group was assisted with cash or alternative forms of help from the government. The second class of poverty was the able-bodied poor who suffered unemployment because of extenuating economic circumstances. Assistance to this group generally consisted of employment in workhouses. Third, were vagrants or beggars who refused work even in the presence of available labor. This group received no assistance. In the United States, localities and states handled poverty either through private entities or churches. Similar to the British Poor Laws, some states maintained workhouses in exchange for food or housing. 16 One of the first instances of social services from the federal government were pensions for soldiers (or their widows) wounded during active service during the Revolutionary War. These pensions were expanded in the 1830s when any veteran of the Revolutionary War could receive a pension The History of Welfare, Welfare Information, Walter I Trattner, From Poor Law to Welfare State: A History of Social Service in America, 6 th ed., (Simon and Schuster, 1998). 17 Debra Graden, ed. Revolutionary War Pension Index. Provo, UT, USA: The Generations Network, Inc., Original data: Washington, D.D.: A. and G. Way, Printers,

17 The U.S. Congress enacted several programs to assist the poor such as the Civil War Pension Program and aid to Civil War Veterans and their families. 18 These pensions mirrored the Revolutionary War requirements. In order to receive them, a soldier must have been injured in active duty. 19 In addition, the U.S. Bureau of Refugees, Freedmen and Abandoned Lands was the first to offer general social services to freed slaves and refugees of the Civil War. The organization s primary goal was to provide basic education, housing and medical aid to refugees and former slaves. 20 The Freedmen s Bureau helped to establish over 4,000 schools and 100 hospitals for former slaves. The Bureau faced much resistance from opposition groups. It was disbanded by President Andrew Johnson in December The Great Depression and the New Deal. Government-provided social services expanded greatly during the Great Depression, when it is estimated that one-fourth of the U.S. workforce was unemployed. President Franklin D. Roosevelt enacted the Social Security Act in The Act, which was amended in 1939, established a number of programs designed to provide aid to various segments of the population such as: Benefits to retirees and the unemployed Aid to Families with Dependent Children Maternal and Child Welfare Assistance 18 Megan McClintock, Civil War Pensions and the Reconstruction of Union Families, The Journal of American History, September Jennifer L. Gross, Civil War Pensions, Encyclopedia of the American Civil War, David S. Heidler and Jeanne T. Heidler ed. April Chad Goldberg, The Freedmen s Bureau and Civil War Pensions: Race and Policy Feedback in America s Nineteenth Century Welfare State, American Sociological Association Convention, January Harold Cole and Lee Ohanian, New Deal Policies and the Persistence of the Great Depression, Journal of Political Economy,

18 Public Health Services Vocational Rehabilitation These programs were significant because they marked the first time the U.S. government gave pensions, unemployment compensation or health insurance to anyone other than war veterans. A number of government agencies were created to oversee the programs such as the U.S. Department of Health and Human Services, the Department of Housing and Urban Development, the Department of Labor, the Department of Agriculture and the Department of Education. The War on Poverty. Government social services again became part of the national agenda in 1962 when Lyndon B. Johnson highlighted the nation s elevated poverty rate (around 19 percent) in his first State of the Union address. 22 The legislation he introduced, termed The War on Poverty, set in motion a series of bills and acts that created programs such as: Food Stamps Work Study Medicaid Medicare VISTA Job Corps Head Start Welfare Reform in the 1990s. Despite these programs, poverty rates remained steady through the 1990s. In 1996, President Bill Clinton signed the Personal Responsibility and Work 22 Carl M. Brauer, Kennedy, Johnson and the War on Poverty, Journal of American History, Vol. 69 No. 1, June

19 Opportunity Reconciliation Act (PRWORA). This program replaced the failed social program AFDC with a block grant program, Temporary Assistance to Needy Families (TANF). 23 The reform legislation had three goals: 1. Reduce welfare dependence and increase employment 2. Reduce child poverty 3. Reduce out-of-wedlock childbearing and strengthen marriage. In the old system, the more people a state signed up for welfare, the more money it got from Washington. The block grant broke this link, creating an incentive for states to help people become self-supporting. Welfare caseloads began to decline in earnest after This decline in dependence coincided with the increase in the employment of single mothers. These trends have been particularly dramatic among those who have the greatest tendency to long-term dependence: younger never-married mother with little education. During the late 1990s, employment of never-married mothers increased by nearly 50 percent, of single mothers who are high school dropouts by 66 percents, and of young single mothers (ages 18 to 24) by nearly 100 percent. Welfare reform impacted the whole welfare caseload, not just the most employable. Not surprisingly, as families decreased reliance on social services and single mothers transitioned into work, the child poverty rate fell, from 20.8 percent in 1995 to 17.8 percent in 2004, lifting 1.6 million children out of poverty. The declines in poverty among black children and children from single-mother families were unprecedented. Neither poverty level had changed much between 1971 and 995. By contrast, six years after PRWORA was enacted, these two poverty rates had fallen to their lowest levels in national history, from 41.5 percent to Christine Kim and Robert Rector, Welfare Reform Turns Ten: Evidence Shows Reduced Dependence, Poverty, Web Memo No. 1183, Heritage Foundation, August 1,

20 percent for black children and from 53.1 percent to 39.8 percent for children from single mother families. According to National Center for Policy Analysis, welfare reform that emphasizes putting welfare recipients to work, as the PRWORA legislation did, is the most successful public policy initiative of this century. 24 In fact, one year after PRWORA was enacted: Alabama reduced its welfare rolls by 48 percent. Indiana, Oklahoma, South Carolina and Tennessee reduced theirs by 49 percent. Mississippi s cases declined by 50 percent, Colorado s by 51 percent, Oregon s by 52 percent and Wisconsin s by 58 percent. Wyoming s cases dropped by an astounding 73 percent. Some argue that the decrease in poverty rates is due to the strong economy of the 1990s. Others note that good economic conditions alone would not have produced the striking changes that occurred in the late 1990s. Historically, periods of economic growth have not resulted in lower welfare dependence. Indeed, during two episodes of economic expansion, the late 1960s and the early 1970s, welfare caseloads actually grew substantially. A national analysis of welfare leavers by O Neill and Hill found that 25 : The TANF program created in 1996 has accounted for more than half of the decline in welfare participation since then and for more than 60 percent of the rise in employment of single mothers. By contrast, the contribution of the booming economy of the late 1990s to these declines was relatively minor, accounting for less than 20 percent of either change. 24 Merril Matthews and Kristin Becker, Making Welfare Work, Study No. 143, National Center for Policy Analysis, December 4, Joe Barnett, Better Off Welfare, Study No. 225, National Center for Policy Analysis, October 7,

21 The 2009 American Recovery and Reinvestment Act of The most recent change to federal government social services was passed in the American Recovery and Reinvestment Act of 2009, signed into law on February 17, This act intends to provide a stimulus to the U.S. economy during the current economic downturn. It includes an expansion of social services including: A $3 billion emergency fund to help states pay for added welfare recipients $15 billion expansion of the child tax credit $86.6 billion for Medicaid $1 billion for the Veterans Health Administration $2 billion for Community Health Centers $500 million for healthcare services on Indian reservations $13 billion for low-income public schoolchildren $2.1 billion for Head Start $19.9 billion for the SNAP program Proponents of the stimulus plan argue that these changes are necessary to help people in poverty weather the current recession. Other scholars do not favor the new social service funding because Act overturns the fiscal foundation of welfare reform and restores AFDC style funding. 26 For the first time since 1996, the federal government will begin paying states bonuses to increase their welfare caseloads. They argue that this will lead to an unnecessary expansion of welfare rolls and increased spending. Overview of Current Social Services 26 Robert Rector and Katherine Bradley, Stimulus Bill Abolishes Welfare Reform and Adds new Welfare Spending, Web Memo No. 2287, Heritage Foundation, February 11,

22 Currently the federal government provides a large number of social services. The following is an overview of selected programs: Supplemental Security Income (SSI) provides cash to people with limited incomes and resources. To qualify a person must be over 65, blind or disabled. They must be a resident of the United States, not absent from the country for more than 30 days and must be either a U.S. citizen or national. In certain circumstances, non-citizens may be eligible. Unlike Social Security benefits, these are not based on prior work and are financed by general funds from the U.S. Treasury. For an individual, the limit of resources one can have and still qualify for SSI is $2,000. It is $3,000 for a couple. The maximum federal benefit level changes yearly and as of January 1, 2008 it was $637 for an individual and $956 for a couple. In addition, some states add on supplemental benefits for those who qualify for SSI. At the end of 2007, there were 7.36 million recipients receiving $3.7 million in monthly benefits. 27 Temporary Assistance for Needy Families (TANF) a block grant program through which the federal government provides funds for individual states to design their own welfare program for families with children. 28 In order to be eligible there must be at least one parent and child and they must be under a certain income level. This income level and the amount of funding vary by state. The program became effective July 1997, replacing AFDC, and was reauthorized in February 2006 through The program uses 36 percent to fits funds to provide direct cash assistance to needy families. 24 percent is used for other services, which is generally comprised of family planning and back-to-work programs. 18 percent is used to provide childcare. Additional work support and employment programs comprise 8 percent. While the remaining 12 percent funds operating and administration costs. 27 Understanding Supplemental Security Income, Social Security Online, TANF Fact Sheet, Office of Family Assistance, 22

23 TANF has three primary goals: 1. Reduce welfare dependence and increase employment 2. Reduce child poverty 3. Reduce out-of-wedlock childbearing and strengthen marriage TANF requires its participants to work as soon as they are ready and no less than two years after first receiving assistance. Single parents must work at least 30 hours per week and two parent families must work between 35 and 55 hours per week. Work activities can include job training, job searching, community service work and paid employment. The only exception to the work requirement is for single parents of children under age 6 that cannot find child care. Additionally, single parents with a child under age 6 are only required to work 20 hours per week. TANF benefits, in most cases, can only be received for 5 years. The most recent change to TANF was passed in the American Recovery and Reinvestment Act of 2009, signed into law on February 17, Under the new Act, instead of receiving a flat funding level, the federal government will increase TANF payments as states increase their welfare loads. 29 In 2006, there were on average 1.9 million families (4.6 million total recipients). Total federal spending for the program was just over $17 billion. For more on TANF see pages Title XX Social Services Block Grant Program a capped entitlement program that gives block grants to the states, which individually determine which wide-range social services they fund. Funds are allocated on the basis of population and are given to U.S. territories as well 29 Robert Rector and Katherine Bradley, Stimulus Bill Abolishes Welfare Reform and Adds new Welfare Spending, Web Memo No. 2287, Heritage Foundation, February 11,

24 as states. Since Title XX was established in 1975, approximately $2.8 billion has been allocated to the grants each year. The social services funded with the grant range from preventing child abuse to providing care for the elderly. Approximately 19 million individuals have received assistance from the Title XX grants, 59 percent of which are children. From 2002 to 2006, child foster care services received 15 percent of the funds, special services for individuals with disabilities received 14 percent of the funds, child protective services received 11 percent of the funds and child day care received 8 percent of the funds. In 2006, states spent more than $193 million of the funds for hurricane relief. Supplemental Nutritional Assistance Program (SNAP) formerly known as the Food Stamp program program designed to increase the food purchasing power of low-income households so that they can buy nutritionally-adequate food. In 2008, approximately 28 million people participated in the program, each averaging a $ benefit. Total spending was $37.6 billion for the year. Nationally, the participation rate among eligible persons was 67 percent. SNAP is currently in all 50 states, the District of Columbia, the Virgin Islands and Guam. Participating households receive food benefits, the value of which is determined by household and income. As required by law, the Food and Nutrition Service annually revises household stamp allotments to reflect changes in the cost of the thrifty food plan. The program not only assists low-income families obtain nutritious food. It also comes to the aid of any persons affected by natural disasters such as Hurricane Katrina. Any sort of natural disaster can leave even the most sufficient and independent household with nothing. 24

25 Federal Housing Assistance (FHA) programs fall into one of three categories: rental housing assistance, federal assistance to state and local governments, and homeownership assistance. Rental assistance comes primarily in the form of vouchers, federal assistances to state and local governments comes primarily in the form of block grants the states can use for rental, homeownership, or community development programs and homeownership assistance comes primarily in the form of direct assistance to defray homebuilding costs and through mortgage insurance programs. FHA s mortgage insurance programs help low and moderate income families become homeowners by lowering some of the costs of their mortgage loans. In 2007 was $42.2 billion. Medicaid Medicaid is a federal-state partnership, created in 1965, which provides medical care to 46 million low-income individuals. States run their own Medicaid programs, while Washington sets minimum eligibility and benefit standards and reimburses states for an average of 57 percent of all program costs. Approximately one-third of Medicaid spending is on senior citizens, partly because Medicare does not cover most long-term care such as nursing homes. Overall, Medicaid finances 40 percent of all long-term care costs. 30 Spending is expected to reach $336 billion this year, accounting for 22 percent of state spending and eclipsing overall education spending. An estimated 14 million more people are currently eligible for Medicaid but are not enrolled. 31 Medicaid does not pay money directly to individuals; instead, it sends payments to their health care providers. Depending on their state s rules, they may also be asked to pay a small part of the cost (co-payment) for some medical services. 30 Brian Riede, A Guide to Fixing Social Security, Medicare and Medicaid, Heritage Foundation, Backgrounder No. 2114, March 11, Dane Wendell, Medicaid Spending Surges, Heartland Institute, June

26 Medicaid is a state administered program, and each state sets its own guidelines regarding eligibility and services. Many groups of people are covered by Medicaid. Even within these groups, though, certain requirements must be meet. These may include, age, whether one is pregnant or disabled, one s income and resources (like bank accounts, real property, or other items that can be sold for cash) and whether one is a U.S. citizen or a lawfully admitted immigrant. The rules for counting income and resources vary from state to state and from group to group. There are special rules for those who live in nursing homes and for disabled children living at home. One s child may be eligible for coverage if he or she is a U.S. citizen or a lawfully admitted immigrant, even if the parents/guardians are not (however, there is a 5-year limit that applies to lawful permanent residents). Eligibility for children is based on the child s status, not the parent s. 32 State Children s Health Insurance Program (SCHIP) began in 1997 to provide health insurance to children (up to age nineteen) 33 and some parents with incomes too high to qualify for Medicaid, but for whom private health insurance was either unavailable or unaffordable. 34 As of fiscal year 2008, there are 7,368,479 people enrolled in SCHIP. SCHIP is not available to legal immigrants who entered the country after The only exception is in states where state budgets are used to cover immigrants that may qualify. Children enrolled in SCHIP are entitled to regular checkups, immunizations, and doctor s visits and hospital care Overview of Medicaid, Centers for Medicare and Medicaid, 33 Robert Longley, Health Insurance for Uninsured Children, 2008, 34 Facts on SCHIP, Results, 35 SCHIP Eligibility Fact Sheet, Health and Human Services, June 2007, 26

27 Since its enactment, the number of uninsured children living in low-income families (between 100 percent and 200 percent of the poverty level) fell by 25 percent, according to the Congressional Budget Office. The amount of SCHIP funds that states receive from the federal government annually is determined by a formula based on the number of uninsured, low-income children in the state and a geographic health care cost factor. For the first 10 years of its existence ( ), SCHIP cost $40 billion. 36 Refugee Assistance authorized in 1980 by the Refugee Act of 1980, which standardized the resettlement services for all refugees admitted to the United States. This Act incorporates the definition of refugee used in the U.N. Protocol, and makes provision for regular flow as well as emergency admission of refugees, and authorizes federal assistance for the resettlement of refugees. Refugees, asylees, Cuban/Haitian entrants, Amerasians, victims of human trafficking, unaccompanied alien children, and survivors of torture are eligible for assistance from the ORR. 37 Since 1975, the United States has resettled approximately 2.6 million refugees. 38 The Refugee Act provides the legal basis for The Office of Refugee Resettlement (ORR). In 2007, the ORR was allocated $587,847,000 in funds SCHIP Facts, Easter Seals Disability Services, 37 History of the Program, Office of Refugee Resettlement, 38 Who We Serve, Office of Refugee Resettlement, 39 Appropriation of Funds, Office of Refugee Resettlement, 27

28 One important program offered by the ORR is the Cash and Medical Assistance (CMA) Program, which is part of the Division of Refugee Assistance and provides reimbursement to states and alternative refugee assistance programs for 100 percent of Refugee Cash Assistance (RCA), Refugee Medical Assistance (RMA), and Unaccompanied Refugee Minors program services, provided to refugees and other eligible persons. ORR clients determined ineligible for Temporary Assistance for Needy Families (TANF) and Medicaid may be eligible for RCA and RMA for up to eight months from the date of arrival in the United States, date of final grant for asylum for asylees, and date of certification for trafficking victims. Refugees may apply for RCA and/or RMA in the state of residence within eight months from the date of arrival. CMA also reimburses states for medical screening costs through local public health clinics so that contagious diseases and medical conditions that may be a barrier to refugees are identified and treated. 40 In addition, the Refugee Social Services Program is a part of the Division of Refugee Assistances. This program supports employability services and other services that address participants barriers to employment such as social adjustment services, interpretation and translation services, day care for children, citizenship and naturalization services, etc. Employability services are designed to enable refugees to obtain jobs within one year of becoming enrolled in services. Supplemental Nutrition Program for Women, Infants and Children (WIC) authorized in 1974 to provide nutritious foods, nutrition education and referrals to health and other social services to participants at no charge. WIC serves low-income pregnant, post partum and breastfeeding women, and infants and children up to age 5 who are at nutrition risk. 40 Programs, Office of Refugee Resettlement 28

29 WIC is not an entitlement program; that is, Congress does not set aside funds to allow every eligible individual to participate in the program. Instead, WIC is a federal grant program for which Congress authorizes a specific amount of funding each year for program operations. The Food and Nutrition Service, which administers the program at the federal level, provides these funds to WIC state agencies (state health departments or comparable agencies) to pay for WIC foods, nutrition education, and administrative costs. Pregnant or postpartum women, infants and children up to age 5 are eligible. They must meet income guidelines, a state residency requirement, and be individually determined to be at nutrition risk by a health professional. To be eligible on the basis of income, applicants income must fall at or below 185 percent of the U.S. poverty Income Guidelines (currently $35,789 for a family of four). A person who participates or has family members who participate in certain other benefit programs, such as the Food Stamp Program, Medicaid, or Temporary Assistance for Needy Families, automatically meets the income eligibility requirements. 41 In 2007, WIC covered 8,285,000 people and cost $5,413,700, Of the 7.9 million people who received WIC benefits each month in FY 2004, approximately 4 million were children, 2 million were infants and 1.9 million were women. 43 WIC serves 45 percent of all infants born in the United States. National School Lunch Program created in 1946 through by the National School Lunch Act. About 7.1 million children were participating in the National School Lunch Program by the end of its first year, By 1970, 200 million children were participating, and by 41 Nutrition Program Facts, USDAA, 2006, Fact Sheet.pdf 42 WIC Program Participation and Cost, USDAA, 2009, 43 Nutrition Program Facts, USDAA, 2006, Fact Sheet.pdf 29

30 1980 the figure was nearly 27 million. In FY2007, more than 30.5 million children each day got their lunch through the National School Lunch Program. Since the program began, more than 187 billion lunches have been served. The National School Lunch Program is a federally assisted meal program operating on over 101,000 public and non-profit private schools and residential child care institutions. Its goal is to provide nutritionally balanced, low-cost or free lunches to school age children. In 1998, Congress expanded the National School Lunch Program to include reimbursement for snacks served to children in afterschool educational and enrichment programs. The Food and Nutrition Service administers the program at the federal level. At the State level, the National School Lunch Program is usually administered by state education agencies which operate the program through agreements with school food authorities. Any child at a participating school may purchase a meal through the program. Children from families with incomes at or below 130 percent of the poverty level are eligible for free meals. Those with incomes between 130 and 185 percent of the poverty level are eligible for reduced-price meals, for which students can be charged no more than 40 cents. (For the period July1, 2008 through June 30, 2009, 130 percent of the poverty level is $27,560 for a family of four; 185 percent is $39,220.) Children from families with incomes over 185 percent of the poverty level pay a full price, though their meals are still subsidized to some extent. Local school food authorities set their own prices for full-price (paid) meals, but must operate their meal services as non-profit programs. The National School Lunch Program cost $8.7 billion in FY

31 Child Care Development Block Grant (CCDF) the primary federal program specifically devoted to child care services and quality. It enables low-income parents and parents receiving TANF to work or to participate in educational or training programs. Funds may also be used to serve children in protective services. In addition, a portion of CCDF funds must be used to enhance child care quality and availability. The component funds of the CCDF were provided under the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA). As of October 1, 1996, PRWORA repealed the old welfare-related child care programs provided under the Social Security Act (AFDC/JOBS Child Care, Transitional Child Care, and At-Risk Child Care). The repealed programs were replaced by Mandatory and Matching Funds appropriated for fiscal years under a new section of the Social Security act. The Administration for Children and Families (ACF) renamed the block grant funds provided under the CCDBG Act of 1990, as amended, the Discretionary Fund, to signify that it must be appropriated annually. PRWORA required that the new mandatory and matching funds be transferred to a state s lead agency for the CCDBG and be administered by that agency, using the provisions of the CCDBG Act, as amended by PRWORA. The CCDF made $5 billion available to states in This program, authorized by CCDBG assists low-income families, families receiving temporary public assistance, ant those transitioning from public assistance in obtaining child care so they can work. Subsidized child care services are available to eligible families through certificates or contracts with providers. Parents may select any legally operating child care provider. Child care providers serving children funded by CCDF must meet basic health and safety requirements set by states. These requirements must address prevention and control of infection diseases, 31