Van Hollen Opening Statement: The War on Poverty: A Progress Report

Jul 31, 2013 Issues: Social Safety Net

Washington, DC – Today Maryland Congressman Chris Van Hollen, Ranking Member of the House Budget Committee, made an opening statement at the House Budget Committee Hearing on the War on Poverty. Below are his remarks as prepared for delivery:

“Mr. Chairman, I must confess I find the timing of this hearing particularly strange. It was just three weeks ago that this House passed a farm bill that lavished huge taxpayer subsidies on agribusinesses and included price fixing favors for various commodities, while totally dropping the food and nutrition supports for struggling families. It is a stark example of misplaced priorities.

“The Republican budget is another example of misplaced priorities. It showers big new tax breaks on the wealthiest while hurting the middle class and shredding the social safety net. I am pleased that we are examining the status of the War on Poverty. I know we have a long way to go to achieve our goals and should be open to fresh ideas on how to win that War. But I also know we will not win that War by adopting budget proposals that reverse the modest gains we have made and throw millions of struggling Americans into poverty. And it simply adds insult to injury – and tortures the English language – to pretend that deep cuts to food and medical assistance programs will somehow ‘strengthen’ that safety net and help people in poverty.

“That claim is built on a specious storyline. It is based on the notion that people choose those safety nets – often mockingly referred to as hammocks – over finding work and getting a job; that people remain out of work today not because of the continuing shockwaves from the greatest financial meltdown since the Great Depression, but because they choose not to work. And that somehow, by making people teetering on the economic precipice even more poor and more desperate, we will give them the willpower and motivation to pull themselves up by their bootstraps. That, by God, we are doing poor people a great favor by cutting the few supports that they have as they try to climb out of poverty.

“This false narrative also ignores several mathematical budget realities. It ignores the fact that the vast bulk of safety net spending goes to the elderly, the disabled, and children – groups that we don’t expect to work.  For example, a full 85 percent of Medicaid spending goes to the elderly, the disabled or kids. It also ignores the fact that the Congressional Budget Office (CBO) projects that, as the economy improves and more jobs become available, more people will find work and spending on the non-health care programs, like the Supplemental Nutrition Assistance Program (SNAP), will decline relative to the size of the economy.

“Another false narrative we often hear is that these safety net programs have done nothing to keep people out of poverty. But that claim only works if you use a very misleading definition of poverty that excludes the non-cash benefits people receive from important supports like Medicaid, SNAP, and the Earned Income Tax Credit (EITC). Obviously, if your measure of poverty doesn’t take into account the benefits received from these programs then – presto – you can magically slash those programs without increasing the number of people in poverty. Indeed, one of our witnesses today, Mr. Besharov, has rightly observed, ‘The official poverty measure does a poor job measuring poverty alleviation efforts (ignoring for example, the EITC and non-cash benefits). This is perhaps the measure’s most damning flaw – because it ignores the important impact of many means-tested benefits on reducing material poverty.’

“A much fuller measure of what the safety net is currently achieving is reflected in the Census Bureau’s supplemental poverty measure.  That data shows that safety net programs lifted 18 million Americans out of poverty in 2011. These programs had an even larger impact on deep poverty.  In 2011, 9.4 percent of the U.S. population would have lived in deep poverty without these programs, which reduced that rate to 5.2 percent.

“So the real question is are we looking to lift people out of poverty, or are we most concerned with minimizing program costs in order to protect tax breaks for the wealthiest people and corporations in America?  The Republican budget clearly takes the second tack.  

“The Republican budget guts important mainstays of the War on Poverty: Medicaid and nutritional assistance.  It cuts $810 billion from base Medicaid funding, not including the repeal of Medicaid expansions in the Affordable Care Act. Consequently, Medicaid will be cut by one-third in 2023.  The CBO concluded that the Republican budget would mean that states will need to increase their spending on Medicaid and CHIP, cut back services, or both. This could mean millions of poor people losing health care coverage – in a program where half of all beneficiaries are children and another quarter are either senior citizens or people with significant disabilities that make them unable to work.

“Likewise, the Republican budget would turn SNAP into a block grant, at a level one-third below current spending projections.  There is simply no way to achieve that level of savings without reducing benefits, cutting people off completely, or some combination of those things.  This is a program where nearly 90 percent of the beneficiaries live in a household with either a child or with someone who is disabled or elderly. For those who can work, SNAP already has strong work incentives built in. SNAP continues to serve one of the most critical of roles in society – providing food security for families who have fallen on hard times.   According to the CBO, as the economy continues to recover, SNAP costs will decline even as benefits are increased to reflect inflation in food costs.  Attempting to force further cuts will leave millions of children without adequate diets.

“In a discussion of the War on Poverty, it would be remiss to ignore the impacts of the sequester and the Republican plans for even deeper cuts to non-defense discretionary programs.  With this year’s sequester, we’ve already seen children turned away from Head Start and seniors losing home-delivered meals. The doubling down of cuts on non-defense programs caused by protecting defense and refusing to consider balanced options to allow for more reasonable funding levels will only mean more of the same.  The cuts are so deep that appropriators are having difficulty implementing them – in fact, while we know Labor-HHS appropriations will take an overall hit of about 20 percent below the sequester, Republicans had to pull the bill this week.  I can only assume it’s because they were afraid to spell out all of the negative ways American families would be impacted.

“Why are Republicans making such deep cuts to programs that help so many?  Because their lopsided approach to the budget plan refuses to ask the wealthiest Americans to pay one penny more for the purpose of deficit reduction. In fact, they would give an average tax cut of $330,000 to millionaires while hitting everyone and everything else much harder. That’s why the Republicans need to slash important investments necessary to keep our economy strong, like investments in education, infrastructure, science, and research. And it’s why they would shred the social safety net.

“It’s time to do the hard work needed to put in place a fiscally responsible budget that adopts the balanced approach recommended by bipartisan groups. Unfortunately, our Republican colleagues continue to block all efforts to go to Conference to negotiate a solution. Instead, we are hearing threats of a government shutdown and defaulting on our debt unless we adopt a budget that protects the wealthy at the expense of the middle class and the most vulnerable in America.”