The President۪s 2011 Budget Priorities: Cut Poverty and Promote Opportunity

 

There are winners and losers inevery budget, and President Obama۪s proposed federal 2011 budget, released thismonth, is no exception.  What۪s most remarkable, however, about thePresident۪s proposal is that low-income kids and families stand out as a clearpriority.  Wherever you look in his budget document, you see that he hasworked hard to put the poor and disadvantaged near the top of his agenda.  We۪ve been following federal budgets for some 40 years, and this is one of thestrongest attempts we۪ve seen from any president, of either party, to proposespending priorities that would do much to reduce poverty and promoteopportunity.

 

Even more remarkable, he proposes todo this within a very austere spending plan.  President Obama has proposeda freeze on domestic non-security discretionary programs. However, within thatfreeze, he has protected and improved many critical low-income programs.  The priorities in the President۪s budgetwork to address both his short-term goal of strengthening the economy andcreating jobs, while helping those hardest hit by the downturn, as well as hislonger-term goal of bringing the deficit down and restoring fiscalresponsibility.

 

We expect a vigorous, engagingdebate about what this budget accomplishes for low-income families, and whatstill needs to be done, but here are major highlights of the proposals thatwould do the most to cut poverty and promote opportunity:

 

• ForChild Nutrition and WIC Reauthorization, the budget proposes $10 billion overten years in additional funding. According to the budget, the additionalinvestments will be “aimed at ending childhood hunger, reducing childhoodobesity, and improving the diets of children, and raising program performanceto better serve our children.”

 

• The President also projects spending atnearly $57.2 billion for SNAP/Food Stamps, an increase of nearly $7.6 billionover FY 2010. The requested level would continue American Recovery andReinvestment Act provisions, which began boosting SNAP/Food Stamp benefits in2009, as well as anticipated increases in program participation.

 

• For continued state fiscalrelief, the President proposes a six-month extension of Medicaid relief some$25 billon to states in order to save and create new jobs, to protect healthcare coverage, and to minimize devastating budget cuts that states willotherwise be forced to impose.

 

• The budget proposal would make theimprovements enacted in the American Recovery and Reinvestment Act (ARRA) tothe Earned Income Tax Credit, the Child Tax Credit, and the AmericanOpportunity Tax Credit permanent. In addition, the President proposes to makethe savers۪ credit for low-income families refundable.  Together, these credits will account for $1.7billion in new spending for 2011 and $13 billion in new spending for 2012.

 

• Child care for low-incomeworking families would also get a boost with an increase of $1.6 billion peryear for the Child Care Development Block Grant.

 

• The budget would extend thecurrent Temporary Assistance for Needy Families (TANF) Emergency Fundauthorized under ARRA for one year through September 2011 and wouldincrease the federal share for states to create subsidized jobs from 80 percentto 100 percent.  Under this proposal,states would get another $2.5 billion targeted to very low-income families andkids.

 

• The President۪s proposal wouldincrease Head Start by nearly $1 billion, continuing the Head Start fundingappropriated in ARRA.  

 

• Itprovides an additional $3.3billion resources and a new fundingtrigger for Energy Assistance to Low-Income Families (LIHEAP), so thatany time there is a spike in energy costs or a significant increase in economichardship, the LIHEAP budget will automatically increase to meet risingdemands.  The Administration notes thatthey expect the trigger to provide roughly $2 billion in additional assistancein 2011 and $6.5 billion over 10 years.

 

• He has requested a total of $321million through the Departments of Education and Labor to establish a new”Partnership for Workforce Innovation.” The initiative would permit theagencies to coordinate competitive grants to states and localities to improveservices, particularly for disadvantaged workers, and to support innovativeworkforce activities such as sector partnerships.

 

• Thebudget also proposes $85 million for the Green Jobs Innovation Fund, whichsupports training to prepare workers for careers in the energy efficiency andclean energy sectors, as described in the Green Jobs Act of 2007. Thisrepresents a $45 million increase over FY 2010 funding levels. Department ofLabor anticipates that these funds would build on the “green jobs” grantsincluded in the recovery act.  Also in theDOL budget, there۪s $46.6 million for Pilots, Demonstrations, and Research,with $40 million reserved for transitional jobs.

 

• Highlights of the HUD budgetinclude $250 million for the Choice Neighborhoods Initiative; $150 million forSustainable Communities;$150 million for a new Catalytic Investment Competitionprogram; a major new initiative to preserve public and assisted housing; a newdemonstration that will combine 10,000 new vouchers with supportive servicesfor individuals and families who are homeless or at risk of homelessness; an increaseof $1.3 billion for housing vouchers (to ensure full renewal of assistance forthe 2.1 million low-income families now using vouchers); and $1 billion for theHousing Trust Fund.

 

• The President proposes to movehis highly anticipated Promise Neighborhoods initiative into operation,increasing funding from $10 million in planning grants during 2010 to awhopping $210 million for next year.

 

• The Social Innovation Fund,appropriated at $50 million in 2010, would be increased to $60 million for2011, allowing the Corporation for National and Community Service to conductanother round of awards for poverty-reduction initiatives.

 

• There۪s $50 million in thebudget to help states adopt paid sick leave and $500 million to support forfatherhood and healthy marriage through a Fatherhood, Marriage, and FamiliesInnovation Fund.

 

• Forlow-income post-secondary education the budget requests a total of $34.8billion to provide Pell Grants to nearly 9 million students in the 2011ې12 award year, with a projected maximumaward of $5,710. This represents an increase of more than $14 billion overcurrent FY 2010 appropriations.   

 

• Last, but hardly least, thePresident requests money for overhauling the federal poverty measure!  In the Department of Commerce budget, there۪sa $5 million initiative to allow the Census Bureau to work with the Bureau ofLabor Statistics to supplement the official poverty measure with annualalternative poverty measures.   At longlast, it looks like there is real movement toward revamping the measure!

Overall, kids do particularly well in this budget. According to FirstFocus, total discretionary spending on programs that are focused on children willsee a $6.12 billion boost over last year۪s levels, an increase of 7.2percent. President Obama۪s budget proposes a cap of $447 billion fornon-security discretionary spending, equal to last year۪s funding level. Despite this freeze, the percentage of federal discretionary money spent onchildren۪s programs would increase under the President۪s request, rising from18.97 percent in fiscal year 2010 to 20.34 percent in fiscal year 2011.  Total discretionary spending on children infiscal year 2010 totaled $84.8 billion. The President۪s budget requestincreases that spending to approximately $90.9 billion.

Nomatter how you cut it, the President۪s proposed budget would be good for jobs,good for kids and families, and good for poverty reduction and sharedprosperity.  Now, of course, it goes toCongress and the hard work starts!

 

Posted by Mike and Shelley

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Hereat Out of the Spotlight, we offer a behind-the-scenes look at thelatest news and information essential to anyone working to fightpoverty. From key political appointees to clashes over policy, we coverthe news that doesn۪t always make the evening news. Check out Out ofthe Spotlight for our take on the twists and turns of the latestpolitical developments and its impact on poverty reduction. Topics andideas are welcome! Just contact mlaracy@aecf.org or watersboots@hotmail.com