Friday, August 26, 2011

Michigan Cuts Welfare: 11,000 Families Lose Benefits!

Michigan Republicans to welfare recipients: 
Elections have consequences. That is something that people who won the last election like to smugly say to people who lost the last election. This is nowhere more true than in Michigan since the recent election of Republican Governor Rick Snyder, former chairman/coo/president of Gateway, who with the assistance of a Republican majority in the legislature, has instituted some sweeping changes.
The latest change is that there will be an end to cash assistance welfare for families who have received more than four years of help. This starts October 1-just as school is starting up and winter is coming.

Lansing— The state Legislature on Wednesday passed a 48-month lifetime limit on welfare benefits expected to cast more than 11,000 families off the welfare rolls on Oct. 1 — including more than 29,700 children, according to state officials.The cumulative time limit will save $77.4 million in the budget year that starts Oct. 1, but Democrats and child advocates said they fear it will cause a humanitarian crisis as social agencies are flooded with families who can't pay for rent, utilities or other essentials.
Gov. Rick Snyder, who proposed the cap as part of his 2012 budget, is expected to sign the bill into law.
Judy Putnam, spokeswoman for the Michigan League for Human Services, said: "The impact is going to come … when families lose a key source of income and may not be able to pay the rent just as the school year is getting started and kids are settling into classrooms."She added that many nonprofits and charities also have been slammed by the recession.
Wayne County will be most affected, with 6,560 families losing the cash assistance. Genesee County will see 1,533 families come off the rolls, with 600 in Muskegon, 385 in Oakland and 371 in Saginaw.
Statewide, 11,188 adults and 29,707 children will lose their benefits in just over five weeks. By September 2012, there will be 13,789 families to drop off the rolls, said Sheryl Thompson, acting deputy director of field operations for the Department of Human Services.
Thompson was not able to give a breakdown of adults and children by county, but she said the average family includes one adult and two children. DHS Director Maura Corrigan announced earlier this month that the agency would no longer grant extensions to clients who have exceeded the five-year federal limit on cash assistance. Thompson said most of the families who will lose their benefits Oct. 1 have been on the rolls five years or longer.
Republicans said Michigan no longer can afford to allow families to stay on the assistance plan for four years or more. Rep. Kenneth Horn, R-Frankenmuth, noted that food stamps, Medicaid and child care payments will continue for those kicked off cash assistance. "This should be a strong statement for Michigan residents that (cash assistance) should not be a lifestyle," Horn told members of the House before Wednesday's vote. The measure passed largely along party lines in both chambers. Link to Detroit News Article
Now I was prepared to be exceedingly wroth but upon reading the article and doing some more research I learned that the current federal lifetime limit on welfare cash assistance is just five years. States are allowed to exempt up to 20% of their case load for hardship reasons, which Michigan announced it would no longer do. So perhaps moving from five years to four years is no big deal? Perhaps.

However Snyder and his merry band of right-wingers also just recently overhauled the Michigan budget and tax structure. I don't intend to dive down into the nuts and bolts right now but the big picture is that pensions are now taxable, the limit for state unemployment payments was reduced, the Earned Income Tax Credit was cut, business taxes were cut and aid to schools was cut. The only problem is that in the real world where states have to balance their budget, cutting taxes leads to less revenue coming in and that has to be made up somehow. How fortunate then for the Republicans that the amount of money they expect to save from the welfare cuts happens to be the exact amount of the probable budget shortfall from the tax cuts.
What an INCREDIBLE coincidence!!!!!! 
Poverty, Schmoverty! Look at the big picture people!!!
Although it's not national news the way something would be if it were happening in California or New York, the ugly truth is that Michigan has a very serious problem with child poverty. It's risen 64% over the past decade

That's right 64%!!! That's a lot of children living in homes with impoverished parents-a lot of people working low pay dead end jobs or unable to find jobs.

More than 36 percent of all Michigan children younger than age 18 were living in a household in 2009 where no parent had full-time, year-round employment, according to the Annie E. Casey Foundation’s annual Kids Count Data Book released today. That compares with 31 percent of children nationally. The report also found that 12 percent or 281,000 children in Michigan had at least one unemployed parent in 2010 compared with 11 percent nationally. And 5 percent of Michigan kids were affected by foreclosures since 2007, compared with 4 percent nationally.
“This report shows with startling clarity how deeply the recession has affected families across Michigan,’’ said Jane Zehnder-Merrell, director of the Kids Count in Michigan project at the Michigan League for Human Services. “Unemployment and foreclosures are adult issues but ones that dramatically affect kids, too. These economic stressors place children at much higher risk of worsening health and education outcomes.”
Some 23 percent of Michigan children lived in poverty last year -- with poverty calculated as two adults and two children living on $21,756 or less, up 64 percent since 2000.
With the news that the Federal COBRA subsidy is ending I guess now would be a particularly bad time to be unemployed in Michigan. The other thing to consider is not only will these welfare cuts hurt some undeserving people but that increasing the labor supply at a time when there is already 9% unemployment is not going to have a particularly good impact on wages. Of course that's if you're an employee. If you're an employer this is good news because your leverage over your current (low-skill) workers just got a little tighter. Don't like your job? Shut up and grin or I'll replace you with a welfare recipient. There is an effort to recall Snyder (it was started well before this latest news) but it doesn't look like it will go anywhere.

Of course to be fair there IS another side to this issue. I don't have much sympathy for it BUT at one point we didn't have federal cash assistance for impoverished people.  A four year lifetime limit is pretty long. If you can't afford kids don't have them. You have no right to other people's money. Some people need a kick in the butt to get them moving. Quit hiding behind your kids and get your tuckus to work. We heard the same doom and gloom predictions when Clinton made changes during the nineties so quit your squawking and get a job.

I have to admit I know some people to whom I would have no problem preaching that last paragraph. But are they the majority of welfare recipients? I don't think so. Not at all.

What's your take?
Is a 4 year lifetime welfare limit too stringent?
Should this wait until there is lower unemployment?
Should this be phased in over a few years?
Is this the morally right thing to do?
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