As the saying goes, you can’t squeeze blood from a stone. That is how many policymakers are beginning to look at state budgets. As talk in the country’s state capitals focus on what to cut - and by how much - the so-called social safety net, meant to catch the people at the bottom before they fall through the floor, is looking particularly frayed.
Last month, Washington Governor Christine Gregoire announced her budget for the next two years. If you’ve been following the crashing economic scene, here and around the world, it should be no surprise to learn the budget proposal calls for considerable cuts in state spending. Faced with a projected budget deficit of nearly $6 billion in the 2009-10 budget year - the largest in Washington state history - Gregoire proposed a spending plan on December 18 that will deeply slice funding for health and human services, education and natural resources, while not raising taxes.Human services were among the hardest hit, with the budget being reduced by 12.2 percent. Health care programs for children, disabled people and the poor will lose $500 million, while the General Assistance Unemployable (GAU) program - temporary help for those who can’t work due to disabilities - will be eliminated entirely.
Without their $339 monthly GAU aid and medical benefits, many of the 21,000 Washington residents who will be cut off may have a difficult time covering the expenses of their basic needs, such as rent and utilities. This complex problem is compounded by the fact that Social Security, the federal disability program, frequently refuses to cover people until they have gone through an appeals process that has several years’ worth of backlogged cases.
Gregoire says she hopes that the Basic Health Plan can find innovative and lower-cost insurance alternatives to meet her proposed 42 percent cut to that program. How she plans to continue to cover the 105,000 people currently served by the program remains a mystery, though she has said she hopes to be able to find the savings without cutting anyone from the program.
Next week, the Legislature will try its hand at deciding how much to spend and on what. Like Gregoire’s plan, predictions are that the process will result in drastic cuts to the programs that serve those least able to fend for themselves. People and programs that have had little clout in the corridors of power, like the folks at the Statewide Poverty Action Network, are under no illusions that they will be able to stave off the cuts, but they are doing what they can to keep the state from slicing through the bones of programs that help the poor.
Poverty Action began life in 1996 as the Washington Welfare Reform Coalition, in response to some of the changes that were happening to the federal welfare system at the time. While the organization still works with Temporary Assistance for Needy Families (TANF), the federally-funded welfare program, in early 2000, Poverty Action broadened its focus to address the issue of poverty.Poverty Action’s Executive Director Maya Baxter sees the organization as having a lofty goal - in her words, “to fight against the root causes of poverty in our state - really to eliminate poverty across the state.” To accomplish that goal, Poverty Action has built a coalition of close to 20 organizations, representing 5,000 individuals across the state.
The groups, which include Voices in Spokane, Power in Olympia and the Washington Community Action Network, all work directly with poor people to give them the lift up they need. They also work to help empower their clients to make their own voices heard in the political process, to press for the things they see as being in their best interests, just as the business interests do through their own groups.
Greer Harewood joined Poverty Action’s Vote for Change campaign this summer to help organize a voter mobilization effort. Since the election, she has been readying for a mass lobbying effort in Olympia on Martin Luther King Day.
“A really great thing about moving toward the People’s Summit and March on the Capitol is that we’re using the momentum of the vote campaign to build toward Martin Luther King Day,” Baxter explains. “That’s something I’m very excited about and it speaks to what Poverty Action does. It’s not just campaign to campaign. It’s trying to build some fluid movement from campaign to campaign.”
Harewood says the Vote for Change program was different from the usual voter outreach efforts in two critical respects. Rather than concentrating on voter registration efforts, she says they targeted people who, while already eligible to vote, often do not make it to the polls.
“The fact that we were focusing on infrequent voters who were already registered is because the previous year, when people were going door-to-door canvassing, it turned out there were a lot of people who were already registered,” she says. “The idea was to treat infrequent voters like frequent voters, who get all kinds of calls from other campaigns, but infrequent voters don’t. So we were calling them and following up with them, letting them know that these things are on the ballot and please vote smart when you’re voting this year.”
Information on local candidates and ballot initiatives was also provided in an effort to encourage people to “vote down the ballot and complete the entire ballot - not just vote in the presidential race,” Harewood says. The strategy was based, in part, on the results of focus groups Poverty Action conducted four years ago, which found people were registering, but that they did not feel they had enough information to make responsible decisions.
According to Harewood, as a nonprofit organization, Poverty Action does not endorse candidates or political parties, but they do take positions on ballot initiatives. This past November, that translated into concerted opposition to Tim Eyman’s I-985 proposal to reroute state funding to traffic congestion and road improvement programs. They also strongly supported the Home Care Workers initiative, which promoted a doubling of paid training hours required for homecare workers. Poverty Action scored victories on both issues.
Baxter says the organization has evolved over the past decade to look at two sides of the poverty-fighting coin - what she describes as “money in and money out. Getting money into people’s pockets that need it - so meeting people’s basic needs and having opportunities to prosper.”“[Although] we’re mainly focused on making change on the state level to impact the causes of poverty within our state,” explains Baxter, “there are a lot of things that have been put on the chopping block this year in the governor’s proposed budget. We’ll be fighting to restore funding for really elemental survival programs. We’re also always looking for opportunities for people to get off of those programs.”
Two of the programs Poverty Action will be lobbying to restore that help people find a way off of state support are Opportunity Grants and Individual Development Account grants. During the 2007 legislative session, Poverty Action was instrumental in passing and funding Opportunity Grants, which provides financial help and support services to low-income people to help them go back to school.
The program covers more than tuition. The cost of books, career counseling, childcare and transportation are “things that really could keep a single mother, for example, from getting back to school,” Baxter says. The program provides grants to students who make no more than 200 percent of the Federal Poverty level, or about $27,000 each year.
Poverty Action also helped push through the legislature the IDA program last year, which offers state-matched savings accounts for college tuition and starting small businesses. “It’s real opportunities,” Baxter says, “for people to begin investing in themselves and moving off these survival support programs.”
On the money out side of the issue, Poverty Action is trying to tackle the ways being poor keeps people poor. These are the things that people with low incomes pay more for than do people with middle- or upper-incomes.
“The biggest thing we’re looking at on the money out side is consumer protections for payday loans,” explains Baxter, who plans to address some of the tactics used by retail check-cashing chains like Money Tree and some credit unions.
Many of these companies rely on a set fee of $15 to $25 for a loan, usually for no more than two weeks, against a post-dated check. The problem comes when the borrower needs to borrow again to cover the check or to meet the next weeks’ expenses. When those rollovers are taken into account, the effective rate for the loans can equal more than 500 percent each year in interest.
Baxter says the organization’s focus last year on regulating mortgage brokers were instrumental in gaining the passage of six bills to strengthen consumer protections against predatory mortgage lending - the first predatory lending protections in the state’s history.
“These six bills really looked at how mortgage brokers, for instance, were not responsible to their clients, they were really just responsible to themselves - so they weren’t acting in anybody’s best interest except for themselves,” she explains. “We would like to see the same thing for other unsecured loans, like payday loans or loans against tax returns - called Refund Anticipation loans.”
Harewood says she is particularly impressed with the way that Poverty Action goes about its work. “I think there’s a lot of accountability and reassessment of what we do, so that we know that we’re improving.