Weekly Briefing

Meanwhile, over in the real world…

Even small safety net cuts can do enormous damage

Quick take: As lawmakers debate the state budget crisis, it's critically important that they honestly acknowledge the real world impacts of cutting state spending by billions of dollars and resist the phony argument that mere "belt tightening" is all that is necessary. This fact was brought home recently when an ill-considered (and relatively minor) state Medicaid program cost savings tactic unfairly deprived 9,000 deserving people of their health insurance coverage.     

There's a popular myth in the political/policy world that, when it comes to public budgeting, it's conservatives to whom society must turn in order to find the requisite quotient of "hard-headed realism."

According to this fable, progressives (or "liberals") are the "soft" ones who refuse to face up to hard facts or to say "no" to the interest groups that are clamoring and the "public trough." Conservatives, on the other hand, are supposedly willing to see and describe the world "like it is."

While this may have been true in some form or fashion at some point in the past, it is clearly not the case today in North Carolina. Just look at the basic positions that the two main ideological camps have staked out in the debate over the state budget: Which one strikes you as "straight talk" and which as "refusing to say no"?  

For the right, the message is simple (some would say "simplistic"):

"We don't need any real hard choices. All North Carolina needs to do is ‘tighten its belt a notch or two' and things will be fine. Reducing spending to 2006 levels? No problem. Increasing class size? No problem. Imposing hundreds of millions of dollars in health and human services spending cuts? No problem."

This brand of messaging reached its low point last week. It occurred when conservative House members played dishonestly to a crowd of assembled budget cut protesters in the Human Services appropriations committee by voting "no" on cuts proposed by House Democrats – even as they were also irresponsibly opposing any new revenues to close the state's budget hole.

For progressives, the messaging has been, as usual, much more complex (and honest). It's gone something like this:

"This is killing us to make these agonizing choices, but the hard reality is that there's no free lunch. North Carolinians cannot have it both ways. In this time of a 20% budget shortfall, we simply cannot maintain core services in any reasonable semblance of their former selves without at least some new revenues. If we do nothing and try to balance the budget exclusively with cuts, we're really going to set ourselves back decades."

Real world impacts

Lest anyone have any doubts about the seriousness of the present situation and the real world impact of the cuts now on the table, consider the following simple matter of "belt tightening" that's already been inflicted unfairly upon a number of North Carolinians. It's a topic that's been featured in this space in the past.

Right now, many North Carolina Social Security benefit recipients receive an annual cost of living adjustment or COLA. The idea, of course, is to allow these people who have earned these modest federal benefits to keep up with inflation; Sounds simple enough.

The problem is that these small COLA's can sometimes bump the recipient slightly over the income threshold for eligibility for the Medicaid health insurance program – sometimes by as little as a dollar or two a month.

As a result, many innocent and deserving people are losing what is probably their most precious and valuable public benefit – affordable health care – as the result of having received a few extra dollars that did nothing other than to keep their income flat. In recent months, 9,000 North Carolinians living on the edge lost their Medicaid benefit because of this absurd policy.

By any fair standard, this is a ridiculous and harmful result that is producing great and unwarranted hardship. And remember, this policy is already in effect as a cost-cutting policy for the state Medicaid program. This isn't some outrageous proposed cut; it's happening now, before the new and extraordinary budget cuts currently under consideration were put forward for the coming year.

Put another way, the current system – one that conservatives allege can be readily pared by another 15-20% with "no problem" – is already operating on such a thin margin that it must resort to such draconian tactics now, under current budget allocations, to make ends meet. (According to advocates for a bill that would restore the COLA recipients, the cuts save the state around $11 million.)

Real "straight talk" on the budget

Though the Medicaid COLA cuts are important and worth fighting to reverse because of their impact on 9,000 innocent women and men, they may be even more important as a small sample of the kinds of things that are sure to come in the months ahead if lawmakers proceed with the cuts that are currently under consideration in a "no new taxes" budget.

As last week's discussions in the House made clear, those things are exceedingly grim: thousands of fewer school teachers, tens of thousands of deserving people losing their health insurance, thousands more of the mentally ill and disabled placed on the track toward institutionalization. If a mere $11 million savings can wreak havoc for thousands of people on such a critical matter, just imagine what cuts of two or three-hundred times that size can and will do.

These aren't mere matters of "belt tightening" that can be casually dismissed as "no problem" or easily traded off with the elimination of a few boneheaded examples of government excess like Mary Easley's salary or some questionable arts expenditure in Charlotte. Try as some conservatives might to conflate the subjects, most of the big money in state government isn't in a line item entitled "waste, fraud and abuse."

Rather, most of the big money in government goes to paying average, everyday people average wages to help their average fellow citizens with average, everyday needs. And given the deeply ingrained American hostility to taxation, it has long been the case (and seems likely to remain the case) that almost all of those average, everyday services have and will be funded in such a way that there is little cushion or room for error – regardless of whether conservative ideologues thinks it's a problem or not.