ROBIN HOOD IN REVERSE: CONGRESS SOAKS THE POOR

Now that they’re back from their 4th of July break, Congress is getting down to the nitty-gritty of putting together next year’s federal budget.

This is hard work. Harder, say, than voting to scrap the entire federal tax code as of Dec. 31, 2002. The House Republican majority, you may recall, did that last month before leaving Washington, D.C., to brag about it back in their districts. (A new, fairer tax code, their bill assures us, will be in place no later than July 4 of that year. Strike up the band.)

But seriously, folks, the Republican budgeteers are back on Capitol Hill, where they are about to balance the federal budget and hand out billions of dollars in additional tax relief, most of it to their wealthy supporters. This they will do without cutting the defense budget, without any new money from a tobacco industry settlement (which they killed last month in the Senate) and without cutting funds for politically popular highway construction projects (which they recently increased by 40 percent.)

How will the Republican leaders in Congress pay for this, you ask?

Easy. They’re going to take it from the poor.

They intend, for instance, to eliminate, at a savings of $871 million, the federally funded summer jobs program for disadvantaged youth. Chicago, like participating cities across the nation, will hire and supervise thousands of teenagers this summer to clean up vacant lots, plant trees and otherwise get a taste of what it’s like to have a job. Next summer, well, the kids will have to find some other way to occupy their time.

The Republicans also intend to eliminate the federal Low-Income Home Energy Assistance Program for a saving of $1 billion. Illinois got about $60 million this year to help pay a portion of the heating bills incurred by families living at or near the poverty level. The average grant was about $200 and most of the money went directly to utility companies. Next winter, let them buy sweaters.

And so it goes, all through the appropriations bills now wending their way through GOP-controlled House and Senate committees.

Over the next five years, Rep. John Kasich (R-Ohio), chairman of the House Budget Committee, proposes to squeeze $10 billion from Medicaid, the federal-state health insurance program for the welfare poor. This he would do by converting the program into a fixed-sum block grant rather than the matching-grant system now in effect. If medical costs or welfare rolls go up for some unexpected reason, states would be on their own.

Kasich wanted to cut another $10 billion from the basic welfare support program called Temporary Assistance for Needy Families. But House Speaker Newt Gingrich (R-Ga.), a guy with a heart, has said it would be better to take the money from the Supplementary Security Income program for the aged and disabled poor; or from the Earned Income Tax Credit for low-income working families with children; or from foster care, child support enforcement and unemployment insurance. Nice guy.

But even those wouldn’t be enough cuts to meet the GOP goal of keeping the budget in balance while making $100 billion in tax and spending cuts.

Other programs likely will have to be axed or severely shaved. These include the welfare-to-work block grants authorized last year, but for which some states, fumbling with unfamiliar paperwork, were late in filing their applications. (Use it or lose it.) Also on the Kasich hit list are spending for “food stamp workfare slots,” “veterans disability compensation for smoking-related disabilities,” the main “Social Services Block Grant” and all Earned Income Tax Credits for childless, low-income workers.

Overall, Kasich & Co. want to cut what are called “non-defense discretionary programs”–most designed to help families in the lower third of the U.S. income spectrum–by about $61 billion over the next five years.

So where is all this saved money going, you ask? Toward deficit reduction?

Not on your life.

“These savings would be used primarily to finance tax cuts for the top third of the population,” according to an analysis prepared by the Washington-based Center on Budget and Policy Priorities. The center has a liberal bent, but I don’t think it’s exaggerating on this one.

Not when you figure Republicans want $100 billion in tax breaks over the next five years to eliminate the so-called “marriage penalty.” Actually, a majority of couples save money by filing their income tax returns jointly, but there are high-earning, two-income couples whose combined income disqualify them from certain deductions and exclusions. If the GOP has its way, this terrible injustice will be rectified.

Then there’s the IRS “reform” bill which rocketed through Congress last week, with its shortening of the minimum holding period, to 12 months from 18, for investment profits to qualify for the reduced 20 percent capital gains tax rate. This will cost the Treasury about $2.1 billion over the next 10 years and roughly twice that in the following decade. More than 60 percent of the tax savings will go to the 1 percent of the population with incomes above $200,000.

Look for President William Jefferson “Flexi-Bill” Clinton to sign the bill into law in the weeks ahead. And to go along with most, if not all, of the GOP budget and tax cuts this fall. The tide of our times is running against the poor. Few in Washington are willing to swim against it.

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Makes you wonder what kind of nation we’ll be celebrating on July 4, 2002.