Critical Poverty-Reducing Programs at Risk in Upcoming Trump Budget
May 17, 2017
News reports suggest President Trump’s full budget proposal, slated for release next week, will include deep cuts to federal safety net programs that provide crucial supports for low-income Kentuckians and help boost our economy in hard times. These cuts to so-called mandatory programs (meaning spending is determined by how many people are eligible) are on top of expected cuts to important non-defense discretionary programs we wrote about previously and were targeted for cuts in President Trump’s initial “skinny budget” proposal in March.
Safety net programs potentially at risk provide what is often temporary assistance during downturns for our most vulnerable Kentuckians, many of whom are children, and improve the economy by injecting dollars in communities when they are needed most.
Supplemental Nutrition Assistance Program (SNAP)
In 2016, 644,659 Kentuckians received SNAP assistance, formerly known as food stamps.
SNAP helps low-income Kentuckians who are out of work or earn low wages afford basic food needs. Since SNAP is designed to be responsive to economic downturns, the number of program participants increased during the Great Recession but has declined in recent years, although it remains a lifeline for people and parts of the state that continue to struggle.
More than 68 percent of SNAP participants in Kentucky are in families with children, and more than 38 percent are in families with members who are elderly or have disabilities; more than 36 percent are in working families that still struggle to put food on the table. The average monthly SNAP benefit for each household member is $123, and the average SNAP benefit per person per meal is $1.36.
SNAP protects families from hardship and hunger, and has been shown to improve children’s health and performance in school and lead to improved long-term health and economic outcomes especially for those who receive SNAP as children. SNAP also serves as an economic stimulus in our state. Between 2009 and 2012, SNAP kept 164,000 people out of poverty in Kentucky, on average. According to Moody’s Analytics, in a weak economy a dollar in SNAP benefits generates $1.70 in economic activity; SNAP benefits pumped about $981 million into our state’s economy in 2016.
Supplemental Security Insurance (SSI)
In 2015, 184,103 Kentuckians received SSI benefits.
SSI provides income support for individuals who are disabled or elderly and have little income and few assets. It is a lifeline for very low-income families caring for children with severe disabilities — including Down Syndrome, cerebral palsy, autism, intellectual disability and blindness. SSI provides financial support to these families that, due to the demands of caring for a child with a disability, face higher costs and more demands on their time. Since eligibility requires both disability status and low incomes and assets, the program is responsive to economic downturns just like SNAP, with participation in the program increasing as poverty rates rise — as during the Great Recession — and decreasing when the economy improves.
Without SSI, many more Kentuckians with disabilities would be in poverty; the program has been shown to lift half of otherwise poor child beneficiaries out of poverty and is also very effective in reducing deep poverty.
Supplemental Security and Disability Insurance (SSDI)
In 2015, 206,175 Kentuckians received SSDI.
SSDI provides vital support to Kentuckians — typically those over the age of 50 — whose careers are cut short due to a severe medical impairment. As noted in a recent research brief disputing assertions about SSDI made by President Trump, “By law, SSDI requires a solid work history, a severe and long-lasting impairment that prevents self-supporting work and is documented by medical evidence, and a five-month waiting period.” Fewer than 4 in 10 applicants are awarded SSDI benefits. The typical SSDI benefit is $1,050 a month. Those receiving SSDI switch to Social Security retirement benefits at age 66.
Medicaid provides health care coverage to a total of 1.4 million Kentuckians, including children, according to the most recent Kentucky Cabinet for Health and Family Services data. Of that total, just under 470,000 qualify for Medicaid under the state’s expansion of eligibility requirements, which would effectively end under the version of the American Heath Care Act (AHCA) that recently passed the U.S. House of Representatives. The cuts to Medicaid expected in President Trump’s full budget proposal would be on top of already terribly damaging cuts included in the AHCA.
Medicaid helps provide important preventive care services and substance abuse treatment to low-income Kentuckians, and makes important economic contributions to the state economy as well. Medicaid provides health care coverage for 38 percent of Kentucky children, and 44 percent of all births in our state are paid for by Medicaid. As with other safety net programs, as low-income Kentuckians’ economic situations improve they cycle off Medicaid — and our state Medicaid rolls reflect this “churn.”
Kentucky has much at risk in federal budget negotiations. In addition to the safety net programs highlighted above, President Trump’s budget could include cuts to mandatory federal spending for child nutrition programs and Pell grants that help low-income Kentuckians attend college. These cuts will be considered along with enormous tax cuts for the wealthy, which Bob Greenstein with the Center on Budget and Policy Priorities calls “a radical version of Robin Hood in reverse.”