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“I see one-third of a nation ill-housed, ill-clad, ill-nourished…

“I see one-third of a nation ill-housed, ill-clad, ill-nourished… The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.” Franklin Roosevelt's second inaugural speech, from January 20, 1937.

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“I see one-third of a nation ill-housed, ill-clad, ill-nourished…

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  1. “I see one-third of a nation ill-housed, ill-clad, ill-nourished… The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.” Franklin Roosevelt's second inaugural speech, from January 20, 1937

  2. CARA, October 12, 2008 Lenny Goldberg Executive Director California Tax Reform Association Susie Smith Director, Californians for Economic Security Insight Center for Community Economic Development (www.insightcced.org); ssmith@insightcced.org; (510) 251-2600 x108 The budget disaster: Why it happened and Where to go from here

  3. Presentation Overview • The good, the bad and the ugly: 08-09 Budget Cuts (Susie) • Structural Budget Problems (Lenny) • What to do about it? (Lenny) • Introducing a new tool to fight the cuts: the Elder Economic Security Standard & Coalition (Susie) • Discussion – Q&A

  4. 08-09 Budget Woes: “War on Seniors!” • MAJOR cuts to safety net programs • Many cuts will result in loss of federal match dollars • Permanent TAX CUT = $965 million in lost revenue, starting 2011 • Permanent suspension of state SSI COLA in 2008 and 2009 • 68% of SSI recipients are disabled, 2% blink and 29% aged

  5. 08-09 Budget Woes: “War on Seniors!” • Health-related issues: • Keeps 10% cut to Medi-Cal provider rates, until 3/1/09 (temporarily crt restraining order to implement) • Requires paperwork 2x/yr for children in Medi-Cal • Increases Healthy Families Program premium contributions for some families by $2-$3 per child/month • APS, line-item veto cut of $11.4 million Allows caps as low as $1,500 per child per yr for dental coverage provided to kids in Healthy Families Program • Reduces rates to health, dental, and vision plans that provide coverage thr the Healthy Families Program by 5%

  6. 08-09 Budget Woes: “War on Seniors!” • Eliminates $11.7 million for the California Discount Prescription Drug Program • $13.2 million reduction to CDA programs • Senior Community Employment Program • Multipurpose Senior Services Program • Alzheimer’s Day Care Resource Centers • Home Delivered Meals Programs • Senior Legal Hotline

  7. 08-09 Budget Woes, cont’d • CalWORKS • Suspended COLA for CalWORKS grants for low-income families, 4th year in a row! • $70 million line-item veto cut to funding that counties use to provide child care and help parents find work Other major cuts in Child Care & Development, K-12 Education, Higher Ed & Transportation!

  8. How did we get here?Revenue background • Long-term structural deficit: $6 billion from “car tax” cut • Plus: $3 billion in paying off previous bonds (how we got through the last time) • Plus: other transfers of funds from GF (Prop 42, 1A) • Plus: good fortune for Schwarzenegger: abusive tax shelters and tax amnesty • Plus: slowdown in growth = $15 billion

  9. Budget agreement • Cuts of $10 billion, including $3.3 in education from expected growth • Vetoes: Senior rental and homeowner assistance • Revenue accelerations, and future large corporate tax cuts: “carry backs” and credit manipulation • “Securitizing” the lottery • Future budget restrictions

  10. Political environment • Why so different from 1991 re 2/3 vote: • Few mod. Republicans (Wilson, Maddy,etc) • Term limits • Safe seats • Gingrich/Norquist takeover of Republican party: “no new taxes” as article of faith • The pledge • A perfect storm? Vs. Majority vote T4CF Organizing effort: Revenue and Republicans

  11. What’s next? • Lottery and budget restrictions on special election ballot, likely June 2009 • Revenues also? • Budget re-opened now, revenues and cuts? Already $3-5 billion in deficit • Planning the turnaround, for the June 2010 ballot

  12. Where do we go from here? • Revenues: repeal permanent loopholes, add new revenues on the June 2010 ballot • Short term revenue options: top brackets, loophole closing, oil, services • Change 2/3 vote for taxes: “Taxpayer Right to Vote” as solution? • Longer term (November 2012): reassess commercial property for cities, counties and schools = $5 billion • [Option : Constitutional Convention]

  13. What will it take to get there? • Unity: labor, seniors, education, health care, public safety, etc • The fiscal recovery/turnaround of California has to become a widely-shared priority • Can we get there?

  14. Elder Economic Security Standard: A New tool can help reframe the budget battle!! The Elder Economic Security Initiative is.. • National, statewide, and local data-driven coalitions to help families and seniors make ends meet • Part of a national movement, with grass-roots component • Guided by state and regional steering committees

  15. CA Elder Economic Security Standard Index: New Tool for Round 2 of the Budget Battles • County-specific cost-of-living index for retired people 65 and older • Min. Income needed for housing, food, health care, transportation, other basic needs • Individual and Couple • 3 Housing Types • Based on public data sources

  16. Elder Standard ExamplesSan Francisco and Humboldt Counties

  17. How the Standards Are Used As a budget & advocacy tool for advocates and policymakers • Make case to protect against cuts (e.g. LAO’s office) • Elder Standard demonstrates we need MORE, not less • Media briefings • Assembly Member Beall’s food hearing • Create responsible and effective public policy • SF, LA & statewide resolutions to modernize FPL • CARA Resolution – thank you!!

  18. But why not use the FPL to fight the budget cuts? • Developed in 1963-64, by Mollie Orshansky of the Social Security Administration • 1955 Food Survey = 1/3 of after tax income on food • USDA thrifty food plan (designed for temporary or emergency use) x 3 = poverty • Varied by family size, but not age • Same amount in every state

  19. Why not use the FPL to fight the budget cuts, cont’d? • Based on 1950’s consumption patterns • Incorporates outdated and inadequate food measure • Measure of deprivation, not stability • The inflation adjustment (CPI)

  20. Building the Movement for Change • Expand Coalitions • Advance national momentum • Bloomberg’s recalculation of NYC poverty • Congressional hearings • Obama endorsement • Villaraigosa interest • CA Joint Resolution • Unite family and elder economic security coalitions • Expand research (e.g. demographic, LTC) • Join the movement! Listserv, advisory committees

  21. Contact Information For more information on CFES, contact: Susie Smith or Jenny Chung Californians for Economic Security (CFES) Insight Center for Community Economic Development Oakland, CA ssmith@insightcced.org or jchung@insightcced.org (510) 251-2600 To find the Family and Elder Standards for your county, go to: • Elder Standard: http://www.insightcced.org/index.php?page=elder-standard-county • Family Standard: http://www.insightcced.org/index.php?page=ca-sss

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