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California Budget Crisis Cuts Close to the Bone

New America Media, News report, Aaron Glantz Posted: Feb 04, 2010

Unless the federal government coughs up $6.9 billion dollars more for California, Governor Arnold Schwarzenneger says he will completely eliminate a host of social programs, including Healthy Families, the state sponsored health insurance for children; CalWORKS welfare program; and In-Home Support Services for the elderly, blind, and disabled (IHSS).

We have a $20 million budget gap, so difficult, almost draconian, measures have to be put on the table, explained H.D. Palmer, spokesperson for Governor Schwarzeneggers Department of Finance.

Ironically, those cuts would come at a time when Californians need the programs most. A new report released this week from the non-profit, California Budget Project, Proposed Budget Cuts Come at a Time of Growing Need, argues that Californias economy hasnt been weaker since the Great Depression. The 12-page report notes that Californians are ill-equipped to weather the cuts the governor is proposing.

The Golden State has lost more than a million jobs since the recession began, and it continues to lose tens of thousands of jobs every month. Six job seekers are searching for each available job. Enrollment in the states Food Stamp Program has increased 43%. The number of Californians receiving CalWorks welfare checks has grown by 86,000; the number enrolled in Medi-Cal has jumped by more than 470,000.

Nearly 900,000 children depend on Healthy Families, the childrens health program Schwarzenegger has proposed to eliminate. More than a half-million families depend on CalWORKS, the welfare program the governor has said needs to be scrapped.

Another program the governor wants to terminate, In Home Support Services for the elderly, disabled and blind, currently serves over 400,000 Californians, according to the state Department of Social Services.

Cutting these services could have dire consequences. For example, If the Governor eliminates the entire IHSS, its going to lead to (poor, elderly people) dying alone in their apartments and SROs [single room occupancy], because in many cases the home care person is the only person who sees them, said James Chionsini, a community organizer with the San Francisco organization, Planning for Elders in the Central City.

Its not even financially sound, Chionsini said, because the cost of home care for an entire year is cheaper than one or two trips to the emergency room, where the old, blind and disabled will be more likely to land if IHSS is cut.

The Governor has said he doesnt want this to happen, which is why hes engaged our congressional delegation and the White House in an effort to get additional federal aid, spokesperson Palmer said.

Advocates note, however, that Schwarzeneggers proposed cuts actually jeopardize federal matching funds that are meant to help states continue, and even expand, programs like Medi-Cal, Healthy Families and CalWORKs.

For instance, $2 billion in proposed cuts to social services could cause the Golden State to lose $5 billion from the federal budget, California Budget Project director Jean Ross said in a conference call Tuesday.

The impact on California families and our states economy would be more than triple the savings in the Governors proposed reductions, Ross said. 

That Schwarzenegger will stick to his proposal is especially concerning in light of the federal budget announced this week by President Obama.

Theres some good news for California in the Presidents budget, Ross said. The President is continuing increased governments share of the Medi-Cal program here in California. Each dollar the state spends will be more than met by the federal government.

Palmer said hes aware of the trade-off. Given the fact that we have close to a $20 billion budget deficit, its pretty natural that we would lose some federal matching funds, he said.

Palmer said Schwarzenegger will wait until May when the governor usually proposes his revised budget to the state legislature based on mid-year taxes collected and anticipated. At that point, if federal funds materialize, he will rescind his proposed action. Otherwise, Palmer said, well pull the trigger.

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