America’s safety net is at risk from Trump’s budget ax
Get a job, not a government handout.
That’s the theme of President Trump’s budget, which takes an ax to an array of federal safety net programs.
Set to be unveiled Tuesday, the Trump administration’s budget is cutting hundreds of billions of dollars from programs such as Medicaid, food stamps and disability insurance. Instead, officials are stressing that Americans have to find jobs to support themselves.
“If you are on food stamps and you are able-bodied, we need you to go to work,” White House Budget Director Mick Mulvaney said to reporters Monday. “If you are on disability insurance and you’re not supposed to be, if you are not truly disabled, we need you to go back to work.”
Details are still forthcoming, but Republicans have long sought to downsize safety net programs, saying they are rife with fraud and stop low-income Americans from being self-sufficient. Mulvaney said he gave Trump a list of programs to reform, and the only ones the president wanted to leave untouched were Social Security and Medicare.
Mulvaney stressed that he believes in the safety net, saying it helps boost the economy because it gives people “the confidence of knowing they can take a gamble and fail and they won’t be completely wiped out.”
But he also feels it needs to be reformed.
“What we’ve done is not try to remove the safety net for folks who need it, but try and figure out if there are folks who don’t need it who need to be back in the workforce,” he said.
Trump officials revealed an outline of their budget plan — known as a “skinny” budget — in March. That outline showed multiple aid programs, including rental and heating assistance, Meals on Wheels and legal aid, coming under the knife.
All told, the budget’s “Reform the Welfare System” proposal would cut $274 billion in spending over 10 years, according to the executive summary.
The Trump budget also assumes major tax reform will occur, and he’s called for major tax cuts that could disproportionately help wealthy individuals and corporations.
While Congress isn’t likely to adopt the budget as is, it does represent a wish list of the Trump administration.
Here are more details on how Trump’s plan would affect several major federal programs for the poor and disabled:
Medicaid: The health insurance program for low-income Americans would be hit with big cuts under the Trump budget.
The budget assumes that the House Republican health care bill would become law. That legislation would slash $839 billion from Medicaid over the next 10 years, according to a Congressional Budget Office analysis of an early version of the Republican health care bill. It would reduce federal support by 25% compared to current law. (An updated score is set to be released Wednesday.)
The Trump budget, however, would go even further, said Mulvaney. The summary tables note a reduction of more than $610 billion to Medicaid spending over the decade, but it is not clear how this ties into cuts from the House bill. The White House would achieve additional savings by slowing the rate of spending growth even more than the House bill, he said.
Medicaid is the nation’s largest single health insurance program, covering more than 70 million low-income children, adults, disabled and elderly people. That’s nearly one in five Americans.
The program covers nearly half of all births in the U.S. and just over half of all spending on long-term care. Two in five children are covered by the program, as are three in five nursing home residents.
Spending on Medicaid in fiscal 2016 totaled $553 billion, with the federal government picking up 63% of the tab and states paying for 37%. Medicaid is the third largest program domestic program in the federal budget, behind Social Security and Medicare. It’s also the biggest source of federal funding for states.
Obamacare expanded the program to cover low-income adults. That added 11 million people to the rolls in the 31 states that opted to expand.
The legislation, which is expected to be overhauled in the Senate, would end enhanced funding for Medicaid expansion in 2020. Also, it would reduce federal support for the entire Medicaid program. States would either receive a set amount of funding per enrollee, known as a per capita grant, or fixed funding in the form of a block grant.
GOP lawmakers and Health Secretary Tom Price would also allow states to require Medicaid recipients to pay premiums and to work. Very few people in the program today pay premiums, and the Obama administration did not allow states to impose work mandates.
Food stamps: The Trump budget would cut $193 billion over 10 years from the Supplemental Nutrition Assistance Program, or SNAP, according to the budget. It would tighten eligibility and require some enrollees to work.
The budget would also require states to contribute to food stamp funding. Right now, the federal government pays for the benefits, though states pick up half the tab for administrating it. The budget calls for states to match the money coming from Washington, D.C., which Mulvaney said will give them the incentive to improve the program and save money.
The program helps just over 42 million low-income Americans put food on the table. Nearly 70% of participants are in families with children, while more than one-quarter are in households with seniors or people with disabilities, according to the left-leaning Center on Budget and Policy Priorities.
SNAP costs $71 billion in fiscal 2016. The average participant received $125.50 a month.
Enrollment soared in the years after the Great Recession, leading some critics to label former President Obama the “food stamp president.” It peaked in 2013, with 47.6 million Americans in the program. In 2008, there were a little more than 28 million American enrolled in SNAP.
SNAP enrollees are already required to work, unless they are exempt because of age, disability or another reason. Children, seniors, and those with disabilities comprise almost two-thirds of all SNAP participants, according to the federal Department of Agriculture, which administers the program.
Childless, able-bodied adults who aren’t working can only receive food stamps for a maximum of three months over a three-year period.
Disability: The Trump budget would cut $72 billion by reforming disability programs. The bulk of the reduction would come from “testing new approaches to increase labor force participation,” according to the budget data.
There are several federal programs that help the disabled.
Some 10.6 million people with serious and long-lasting medical impairments receive Social Security Disability Insurance. This includes 8.8 million disabled workers and 1.8 million children and spouses of these workers. The average monthly benefit is $1,032, according to the Social Security Administration.
The number of Americans collecting disability also jumped during the Great Recession. Fewer than 9 million people received disability in 2007.
Recipients, who must have worked for at least a quarter of their adult lives and five of the past 10 years, usually have less education and are older, according to the Center on Budget and Policy Priorities. The typical enrollee is in his or her late 50s.
Their monthly benefits total nearly $11 billion. Employers and employees each pay a disability insurance tax of 1.185% on earnings, up to a certain salary level.
There’s long been concerns that some participants are gaming the system, either exaggerating the extent of their ailment or staying on the program after they recover. Relatively few enrollees leave SSDI. Prior efforts to get people back to work have not proved very successful.
By getting more enrollees to return to work, they will not only stop receiving benefits, but they will also pay into the system, Mulvaney said.
Social Security also provides funds to about 6 million low-income disabled Americans through the Supplemental Security Income program.