Holes in the safety net
The budget debate in Sacramento seems to have moved past the question of how to spend fewer dollars, focusing instead on the structural reforms that a handful of Republicans are seeking in return for their support. That’s unfortunate, because the cuts being proposed in key safety-net programs have ugly implications for all state residents, not just the poor and disadvantaged. There may be no practical alternative to the cuts, but that doesn’t mean they should be made lightly.
The demand for welfare, Medi-Cal and other safety-net programs is cyclical, with costs going up during downturns as tax revenues plummet. In recent years, lawmakers have sought repeatedly to rein in spending by reducing the availability of those programs and shrinking their benefits.
More than half of the $12.5 billion in spending reductions that Gov. Jerry Brown proposed this year were in social services. Negotiators for the Assembly and the Senate restored some of that funding in their conference report, but still called for billions in cuts to healthcare, preschool subsidies, child care and welfare payments.
For example, Brown proposed to halve spending on CalWORKs, the state’s welfare-to-work program, even though it pays Californians less than it did 15 years ago. The conferees restored about $400 million of the $1.5 billion Brown proposed to cut, in part by allowing children to continue to receive aid after their parents’ benefits are terminated. Still, it’s hard to justify pushing people off the welfare rolls faster when unemployment is high and jobs are scarce.
The rationale for safety-net programs is not just that they are humane but that they benefit society as a whole. Brown’s proposed cuts would have the opposite effect. In the short term, the reductions in Medi-Cal — including reduced payments to healthcare providers and potentially unaffordable co-pays for medical care — would cause doctors and hospitals to pass on more of their costs to patients with private insurance, leading to higher premiums that fewer people can afford.
In the long run, an inadequate safety net is likely to lead to higher dropout rates, more incarcerations and less productivity by those who can’t obtain needed services. That’s particularly true of the money spent helping children in low-income families prepare for and stay in school. These programs aren’t above scrutiny, but rather than pruning them meticulously, lawmakers have proposed deep, broad cuts.
The political realities in Sacramento make it impossible to avoid shrinking California’s safety net. But it’s not a solution to the state’s budget problems; it’s just laying the groundwork for something worse.
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