By: Stephen Lendman
Source: globalresearch.ca
Stephen Lendman, in his poignant and timely essay, calls attention to the increasing problem of homelessness and hunger in America in the face of severe deteriorating economic conditions and growing human needs. Drawing on several studies and reports, one learns that, underpinning the growing poverty is the state budget shortfalls which have lead to deep social service cuts, affecting the already vulnerable–children, elderly, and disabled–placing an even higher burden on them to cope and survive. The stats are frightening. On August 6th the U.S. Department of Agriculture reported a record 34.4 million Americans– one in nine– receiving food stamps in May, as unemployment keeps surging.
An Epidemic of State Budget Shortfalls
As economic conditions deteriorate, the Center on Budget and Policy Priorities (CBPP)’s July 29 report highlighted the growing problem. Titled “New Fiscal Year Brings No Relief from Unprecedented State Budget Problems,” it cited the following issues:
— at least 48 states “addressed or still face shortfalls in (their FY 2010) budgets,” the result of “the worst decline in tax receipts in decades;”
— at issue is a $163 billion deficit or 24% of their budgets, and these numbers keep rising as conditions worsen;
— at least 33 states “already anticipate” 2011 deficits that may exceed 2010 ones; and
— for FYs 2010 and 2011, shortfalls of at least $350 billion are expected, and FY 2012 may bring little or no relief.
In response, deep social service cuts are being implemented, putting the burden on vulnerable Americans to cope and survive. The situation is grave and worsening with at least 21 states cutting “low-income children’s or families’ eligibility for health insurance or reduce their access to health care services.”
Elderly and disabled persons programs are also being reduced or eliminated. So are services for home and child care, rehabilitation, and other essential needs for the poor and low-income households. The most vulnerable of all are affected, yet more cuts are expected as new budget pressures arise.
Pre-school, K-12, and higher education cuts are being made as well. Public payrolls and hours worked are being slashed, exacerbating the growing unemployment problem, worse still by cutting pay for the still-employed. Tax increases may also be considered at the worst possible time.
“Expenditure cuts and tax increases are problematic policies during an economic downturn because they reduce overall demand and can make the downturn deeper. When states cut spending, they lay off employees, cancel contracts with vendors, eliminate or lower payments to businesses and nonprofit organizations that provide direct services, and cut benefit payments to individuals.”
