Needs UP, Services DOWN

Today, more Americans are looking to the government for help, yet the budgets of government-funded social service programs are dwindling.

In spite of better news on the economic front, the government budget crisis is far from over. The legacy of the Bush tax cuts, which decreased federal revenue and negatively impacted state finances, lead to a greater need for services that cannot be met by strapped cities, states and nonprofit service providers. These cuts are especially hard for low-income working families, the unemployed, and the poor. Some examples follow:

According to the annual survey by the U.S. Conference of Mayors:

  • Requests for emergency food assistance during the past year was UP by an average of 17 percent in the twenty-five cities surveyed. Meanwhile, services were DOWN leading to an estimated 14 percent of those requests unmet.
  • The overall requests for emergency shelter during the past year was UP by an average of 13 percent and requests by families was UP by 15 percent. However, services were DOWN causing an estimated 30 percent of the overall requests and 33 percent of the requests by families going unmet.
  • Requests for assisted housing during the past year was UP by an average of 83 percent. But with services DOWN, only 33 percent of all low-income households were eligible for assisted housing, and the average wait to receive services increased to two years.
What are the causes of increased needs?
The Mayors' report listed the causes of hunger in order by frequency:
  • unemployment
  • low-paying jobs
  • high housing costs
  • medical or health care costs
  • homelessness
  • poverty or lack of income
  • substance abuse and mental health problems
  • reduced public benefits
  • child care costs
  • limited life skills
  • downturn and weakening of the economy
  • transportation expenses or the lack of transportation
  • lack of information about Food Stamps
  • lack of nutritional education
  • increase in the senior population.

The reported causes of homelessness were:

  • lack of affordable housing
  • mental illness and lack of needed services
  • low-paying jobs
  • substance abuse and lack of needed services
  • unemployment
  • domestic violence
  • poverty
  • prison release.

Other indicators:

  • According to reports by the Center on Budget and Policy Priorities, UP to 1.6 million low-income individuals, including a half a million children, are losing health care coverage due to budget cuts. Yet again, services are DOWN: Six states -- Alabama, Colorado, Florida, Maryland, Montana, and Utah -- have simply stopped enrolling children who are eligible for the State Children's Health Insurance Program (SCHIP). Cuts in health care coverage put an increased burden on private and public hospitals and clinics. The number of uninsured Americans, UP by two million from 2001, was 43.6 million in 2002. This number is expected to increase because the expiration of the $20 billion in federal assistance for state fiscal relief on July 1, 2004, which is unlikely to be renewed.
  • According to The College Board, the annual costs of college tuition and fees for a four year public college is UP 14.1 percent to $4,694. The annual cost for a two-year public college is UP 13.8 percent to $1,905. (The annual cost of a private four-year college only increased 6% to $19,710). Most states have cut funding for higher education.
  • Last year, eleven states cut K-12 school funding. Included in the cuts were the elimination of reading specialists, all-day kindergarten and pre-school programs, summer school for 9th, 10th, and 11th grades, and transportation to and from school. Nine states from the previous year had to make same type of cuts.

While headlines might boast good economic news, unemployment remains high, the jobs that are being created are low-wage jobs, and many families are struggling for basic food and shelter needs. Adding to the plight of many Americans is the strong indication that a new round of budget cuts will take place at the state level during the coming fiscal year. At the same time, the size of federal budget deficits and a growing national debt will have a chilling effect on increases in spending for programs and services that weave the safety net, provide the means for people to escape poverty, and ensure the government services that we all depend upon. Both middle-class and low-income Americans are feeling the pinch. Many of the things that people worry about -- wages, jobs, health care, credit card debt, retirement security, etc. -- are becoming more of a problem according to a report by the Campaign for America's Future.

The list of social needs above makes a strong case for more, not less, investment in the services needed to lift people out of poverty. The list includes long-term challenges, such as the aging population and the flux of prisoners being released due the expiration of their mandatory minimum sentences. Unfortunately, these important issues remain on the back burner of the nation’s political agenda.

The President is expected to introduce more tax cuts in his forthcoming State of the Union address and FY 2005 budget proposal. Most presidential candidates are calling for their own tax cuts as well. Tax cuts, which are ultimately cuts in revenue, will result in a government that is less and less able to provide the services that most Americans want and need. At the same time, the President is proposing a massive increase in spending for space exploration. While this maybe a worthy cause, it is essential to get priorities sorted. This means the federal government needs the revenue base to address these types of domestic needs.
back to Blog