that the President Obama’s National Commission on Fiscal Responsibility and
Reform has delivered its recommendations, Spotlight on Poverty and Opportunity
will present a diversity of voices to discuss how budgetary changes will (or
should) affect low-income individuals. Contributions will cover the following
topics—Economic Stability and Recovery, Social Security, Health Care, and Taxes
and Tax Expenditures.
commentary is the latest in the series, entitled “Opportunity and the Budget: Needs, Choices, and the Future.” It addresses the following question, “Taxes
and Tax Expenditures: Tax Expenditures Represent Important Anti-Poverty Programs—What
Role Do They Play in the Budget Conversation?”
240,000 low-income parents got jobs through the Temporary Assistance for Needy Families
Emergency Fund before Congress let it expire at the end of September. While Congress was willing to sacrifice this
effective program in the name of deficit reduction, a better approach would be
to increase revenues to maintain investments in our children and workers.
better choice becomes more clear when we consider the individual stories at
stake in budgetary decisions.
Vega, a single mom, worked for the Illinois Hunger Coalition as a site
coordinator for summer food programs. She was one of the last to receive a
temporary job through the TANF Emergency Fund.
a conversation with Coalition
on Human Needs, Melania talked about how her job allowed her to pay off debts from
a seven-month period of unemployment, and how she is now able to pay for child
care, car insurance, and dance classes for her daughter. Some weeks afterward,
Melania got the bad news that there was no funding to extend her employment,
and was forced to return to joblessness.
we think about the federal budget deficit, it is worth also thinking about
Melania, her daughter, and the low-income families she served at work. Is it
possible to reduce the long-term federal deficit without compromising Melania’s
income and child nutrition?
is, and an important part of the answer lies in increasing federal revenues.
are a very wealthy nation and the top one percent holds a bigger share of that
wealth than at any time since 1928. The tax cuts, extended in December for
another two years, will give each household in the top one percent an average tax
cut of $60,000 a year and households earning a million dollars or more $150,000
top one percent stands to gain more than $1 trillion over the next
ten years. During this period, what is more important: investing in good
nutrition for children, reducing the deficit, or giving still more to the
would address these budgetary problems by ending the Bush-era tax cuts for the
top income households and use the revenue to pay down the deficit. They might also
choose to cut programs supporting child nutrition or other similar investments.
would be a penny-wise, pound-foolish kind of mistake. Young children whose
families cannot always afford nutritious food are more likely to become ill and
to be hospitalized. They are also more likely to need special education and have
lower reading and math test scores by the third grade, according to the medical
researchers at Children’s
we provide adequate nutrition, it pays off in better health and development,
which means children do better in school and in life.
important services land on the chopping block, children won’t get the benefit
of nutritious food in their child care centers because hundreds of thousands of
child care placements will be cut. Parents won’t get jobs weatherizing homes
despite the energy and cost savings for millions of low-income families. Class
sizes will rise and America’s
children will continue to fall behind in education.
deficit reduction is important, but some who talk about it really care more
about something else—shrinking the federal government. The House, for example, voted
to slash services and jobs this year while keeping the deficit high through tax
Coalition on Human Needs is joining with many groups in a campaign to prevent
such cuts. We call it Strengthening America’s Values and Economy (SAVE) For All.
parents like Melania a chance is an American value. It’s also a practical way
to spur economic growth.
balanced approach that collects more revenues and uses a considerable
proportion for deficit reduction, while saving enough to invest in rebuilding
our economy and improving our children’s life chances, will have the best and
most sustained pay-off. Ultimately, the biggest deficit reduction measure is an
expanding economy, with more people working and paying taxes.
we want economic growth, we must make investments that give dedicated parents
like Melania the chance to contribute. If we cut programs that create jobs and
prepare today’s and tomorrow’s workers for the jobs of the future, we may be reducing
the deficit modestly now, but we are ultimately setting our nation up for less
tax-paying productivity in the years ahead.
can also look to other sources of revenue such as reducing tax breaks for the
oil and gas industry or those sheltering income offshore
and turning some tax deductions into credits so they are less skewed to benefit
those at the top.
revenue should not be the sole source of deficit reduction. We should cut
wasteful expenditures, in the military and elsewhere, but we should not cut the
services that help our people succeed.
To view a PDF version of this document, click here.
is the Executive Director of Coalition on Human Needs.