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California to Cut Social Services as Need Skyrockets

New America Media, News Report, Edwin Okong'o Posted: Dec 24, 2008

A deteriorating economy, rising food prices and soaring unemployment are driving more Californians to seek government assistance, even as lawmakers propose spending cuts in public programs to close the budget gap, according to a new report.

"Budget Cuts Come at a Time of Need," an analysis by the California Budget Project, examined information from state social service and health agencies and found both growing need and changing demographics among those seeking public services.

"We are looking at the data and seeing an increase in demand and a change in the type of families that apply," said Jean Ross, executive director of the project, a nonpartisan public policy research group in Sacramento.

A growing number of the new applicants are families that had never before qualified for public assistance, Ross said.

With dwindling revenues and a state budget shortfall of more than $40 billion, California lawmakers from both parties have proposed spending cuts that would affect programs intended to help people in times of hardship. Democrats have suggested suspending cost-of-living adjustments for welfare cash recipients in order to save $100 million. Republicans, on the other hand, say that the state could save $1 billion if it limited eligibility for assistance and cut cash grants by 10 percent.

Considering the increase in the number of people in need, cuts could overwhelm public assistance programs, which government workers say are already under strain, said Ross. Between September 2007 and September 2008, the number of California families receiving cash assistance through CalWORKS increased by 27,000.

The number of families applying for assistance from special nutrition and health care programs for women and children has also jumped. During the 12 months ending in September 2008, an estimated 288,000 more people received food stamps, nearly four times the number in the previous year. Although it is the federal government that funds the food stamp program, soaring use of food stamps is an indicator of rising economic hardship in California.

In November, California's unemployment rate hit 8.4 percent, the highest level in 14 years. Government analysts project that the rate will rise to 8.8 percent in 2009 and 9.3 percent in 2010. Alissa Anderson, co-author of the CBP report, said that as alarming as the unemployment predictions look, they fall short in capturing the seriousness of the problem.

"The numbers don't tell the full story," Anderson said.

Anderson explained that Californians who had not looked for work in four weeks and those whose hours had been reduced were not usually included in unemployment data. The state's Employment Development Department estimates that more than 900,000 Californians are underemployed. Like the many unemployed, the underemployed are increasingly looking to government programs to supplement their lost income, according to the report.

Ross said that cutting spending on cash programs that help people in times of need not only hurts the people, it's also bad for the economy.

"Cutting back at a time like this is exactly the opposite of what we need to do," Ross said.

She added that rather than hold on to the money, people who get cash assistance often spend it immediately, therefore helping the economy.

"Every dollar goes into the pocketbook and immediately back out to clothing stores and grocery stores or to landlords," Ross said.



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