National Urban League President and CEO Marc Morial today called upon House leaders to halt the spending cut frenzy in the name of deficit reduction in their bill to fund the federal government through the end of this fiscal year.
Instead, Morial called upon House leaders to take a fair and balanced approach to deficit reduction.
“We cannot balance the budget on the backs of hardworking American citizens, on our families, our children, the elderly, the disabled, our first responders, our infrastructure and our very future, without ensuring that corporations, defense and high net-worth individuals carry their share of this burden,” Morial said. “Their so-called deficit reduction plan would not only place millions of vulnerable Americans in harm’s way, but would jeopardize a reviving economy by eliminating at least 800,000 private and public-sector jobs, according to an independent study.”
Extracting the magnitude of cuts proposed in the CR over the next seven months would mean that high poverty school districts would lose nearly $694 million in funding, 200,000 Head Start children would be shown the door and thousands of teachers would lose their jobs, low income students struggling to further their education would see their maximum Pell grant reduced by $845. Programs to assist the unemployed and low skilled would be obliterated by a cut of about $2.9 billion. Ex-offender job training programs would be brought to an end, and job training and placement programs for seniors would be cut by more than 50 percent.
Low-income individuals’ access to health care provided through our nation’s community health centers would be severely restricted because of $1.3 billion in proposed cuts, and $850 million would be extracted from the Centers for Disease Control and Prevention. Housing counseling programs would be eliminated at a time when this nation is still struggling to address the foreclosure crisis. Housing for the elderly would suffer a 67 percent cut and housing programs for persons with disabilities would be slashed by 70 percent.
The Community Development Fund would be cut $2.95 billion from $4.45 billion in FY10 spending, the vast majority of which went to community development block grants.
Premature cuts in important discretionary spending at this nascent stage in the recovery could stymie efforts to rebuild a strong economy with robust job creation and economic growth. Job growth at this stage in the recovery has not been sufficient to bring the unemployment rate below 9 percent.
“Government spending is not the sole cause of the deficit,” said Morial. “A balanced approach reigning in our deficits calls for looking at the revenue side of the ledger.”
Federal tax revenues reached a high of 20.6% in 2000 and a low of 16.1% in 2004 due to the Bush tax cuts. These tax rates are too low and have contributed to budget deficits. Average Federal tax revenues between 1980 to 2000 under Presidents Reagan, George H.W. Bush and Clinton were 18.5% of GDP. The collapse in tax revenues from the recession accounts for 44% of the rise in the budget deficit between 2008 and 2009.
“Removing the recession’s impact on tax revenues and spending is central to reducing the budget deficit. Job growth is central to that and can reduce the budget deficit by $310 billion,” Morial said.
