Governor Jerry Brown proposes to carve $946 million out of CalWORKs, in a total 2012-2013 budget of over $94 billion. That’s about a one percent swing in state government spending. Is it worth it?
Most of the proposed $946 million savings will come from reducing full CalWORKs eligibility from 48 months to 24 months. Benefit levels will also be frozen or cut. The total result will be payment cuts for about 432,000 low-income families, according to Legislative Analyst’s Office (LAO) estimates.
All budget cuts, and all tax increases, have undesirable side-effects. But governments have to raise and spend money. The question is which spending items justify the cost in taxes. On this metric, how do the proposed CalWORKs cuts compare?
From the budget-maker’s perspective, a spending cut is a spending cut and that’s the end of the story. Money not spent is money saved. But squeeze a balloon here and it puffs out there. Squeeze it too much and it explodes.
What will happen if spending in support of low-income families is cut by $946 million? The first thing that will happen is that hundreds of thousands of very low-income families will have to cut their own budgets. This will immediately harm the rest of the California economy.
Families living at or under the poverty line don’t put aside their income to invest in business opportunities out-of-state or overseas. They spend their money – every cent, every month.
When they spend it, they employ people in grocery stores, child-care centers, discount stores, anywhere people spend money. That keeps other people employed, who then go on to spend money as well. Economists call this the multiplier effect: a dollar of government spending doesn’t just generate a dollar in the state economy. It generates much more, especially when the people who get it spend it quickly and locally.
The second thing that will happen if CalWORKs is cut is that CalWORKs families will start to feel additional financial strain. Sadly, family financial pressures are well-known to predict future child abuse – physical, sexual, and emotional. The rise in violence against children resulting from additional financial pressures being placed on their families is predictable and preventable.
In addition to the terrible human impacts, the rise in child abuse will result in increased parental interaction with the criminal justice system and higher levels of child assignment to foster care.
It is impossible to predict the amount of additional abuse that will be generated and the proportion of this abuse that will result in state intervention, but even a small rise could wipe out any immediate cost savings from reductions in CalWORKs spending.
Third, when the state pulls back from helping mothers care for their own children, growth in the state’s foster care caseload is inevitable.
As children move from CalWORKS-subsidized home care to state-supported foster care there is a direct increase in state costs. The average per-child foster care payment is about equal to the average per-family CalWORKS payment. The indirect costs, however, will be even higher.
For example, the chance that mothers will be medicated for severe psychoses is 60 percent higher when their children are placed in foster care (once proper statistical controls have been made).
Mothers trying to complete drug programs are also much more successful when their children live with them than when their children are in foster care.
Foster care should be an option of last resort to remove children from dangerous family environments, not a financial substitute for keeping families together.
The LAO estimates that 432,000 California families in all will be affected by the proposed cuts, with 104,000 families to have their benefits completely eliminated within one year.
There are only about 4,151,000 families with children in California.
The cuts will thus affect more than one-tenth of all California families. The proportion of California’s children affected will be even larger, since CalWORKS participants have more children, on average, than non-participants.
We must ask: Would it cause more damage to increase taxes on the richest 10 percent of California families, or to cut benefits for the poorest 10 percent?
Put that way, it is hard to believe that the correct answer is to cut CalWORKs.
Cutting the CalWORKS budget won’t eliminate the problems CalWORKs exists to address. It will make them worse, potentially much worse. The proposed cuts are penny-wise, dollar-foolish, and completely heartless. They should be abandoned.
Salvatore Babones is writing on behalf of the sisters of St. Vincent’s, Santa Barbara, who commissioned him (pro bono) to author a study of the effects of the proposed CalWORKs cuts on California families. He is a senior lecturer in sociology and social policy at the University of Sydney, Australia, and an associate fellow of the Institute for Policy Studies, Washington DC.
Comments
Taxing us further is like giving more smack to the heroine junkie: typical these junkhead tax collecting politicians would leverage the perception of Cal Works, and holding up single mothers for economic ransom, as strategy to campaign for more taxes.
Talk about "abuse" .. California has been socking it to the taxpayer - illegally - for quite some time now where huge amounts of money is being siphoned between payroll pensions, the UC's extensive budgets, ditsy and over extended grant programs, and coddling individule work ethic that is fit to be fired.
Not long ago the State of California siphoned $50 Million surplus from a program called the Victim Witness Protection Insurance Fund to meet other agency fiscal ambitions.. a business model platform that harness revenue streams from practically every infraction, misdemeanor and felony issued in the State - that is reimbursed again by convicted violent offenders, anyway.
Another insurance scam the State of California has been pushing can be found at State Compensation Insurance Fund (SCIF) - that systematically denies legitimate claims, settle far below the policy standard, and somehow gets the Federal Social Security system to pay for everything, ultimately .. while still charging top dollar against the employer enough to land private enterprise right out of business.
Incidentally, SCIF is the ONE California state department agency where staff isn't being furloughed!
Cal Trans too will endorse vast amounts of expenditures for highway paving; too often 3000% (or more) beyond a project is worth.
Quality of service has already diminished substantially for the area region poor, while cost of their doing things, Sacramento's way, just compound: creating more problems than solved, only to support some serious fiscal discrepancies.
Currently very little incentive exists among State Agencies with all the job security represented, compounded with State Agency union ambition stakeholder representation - currently in the legislative branches (including local Assembly) - to provide anything other than a climate of destruction which is headed for ultimate fallout.
SantaNa (anonymous profile)
April 17, 2012 at 9:51 a.m. (Suggest removal)
We all know that the major recipient of CalWORKs is illegal immigrant families - Mexican citizens. These families came here illegally to reap the benefits of our society and because of their huge numbers, they are sinking it. Shall we allow our country to become like Mexico?
We must stop government handouts to foreign citizens so our citizens can get the help they need. We have enough troubles of our own and cannot afford to carry Mexico's burden too.
ChasLBerg (anonymous profile)
April 20, 2012 at 8:21 a.m. (Suggest removal)
Really? "We all know..." Please cite documentation to support your claim, "ChasLBerg".
By any chance, do you know how many legal residents of the state benefit from this program? Do you know how many children have a place to live or other things that we all take for granted due to this program?
Just throwing out generalized comments disparaging the thousands of deserving and eligible recipients of this program is pretty mean-spirited.
Let them eat cake, right?
Gandalf47 (anonymous profile)
April 20, 2012 at 11 a.m. (Suggest removal)
ChasLBerg is wrong, and his comment pretty much the definition of an ignorant bigot would say.
From the DSS website:
"State law provides that aliens shall be eligible for aid only to the extent permitted by federal law. An alien shall only be eligible for aid if the alien has been lawfully admitted for permanent residence, or is otherwise permanently residing in the United States under color of law. No aid shall be paid unless evidence as to eligible alien status is presented. (W&IC §11104)
"Only citizens of the United States and certain categories of aliens are eligible for CalWORKs (formerly AFDC). Citizens must prove their citizenship and aliens must prove their eligible alien status. Aid shall not be authorized until eligible alien status is verified. (§42-430)"
http://www.dss.cahwnet.gov/cdssweb/PG...
Chester_Arthur_Burnett (anonymous profile)
April 20, 2012 at 11:42 a.m. (Suggest removal)
Sigh...
First: illegal immigrants can get benefits for their citizen children if they are born here, including benefits that ultimately support themselves. Section 8 for housing, WIC, Food stamps, daycare subsidies, CalWorks and many other programs.
Second: All these predictions of doom and gloom are nonsense. It's the same stuff we heard during the Clinton administration when he passed (with a republican congress) Welfare Reform. Back then, Amageddon was going to strike and instead.... crickets. People adjusted quickly: upward. They got jobs, re-organized their lives, changed their spending and living habits, etc.
Lastly, all this drivel about poor people spending money to employ other people at shops and businesses is ridiculous thinking. According to this logic, we should increase the number of poor people spending money they did not earn that we confiscated (through taxation and interest on state bonds we sell) from producers that work hard and make better personal decisions while we also 2x and 3x overpay public sector worker benefits (pensions, etc.) and drive taxpayers our of our state. Love that plan!
None of this makes any sense except for one case: you want to feel good about yourself; warm and fuzzy inside, logic be tossed out.
willy88 (anonymous profile)
April 20, 2012 at 9:21 p.m. (Suggest removal)
Actually, to presume children "born here" are citizens is a bit of a misnomer. The children inherit whatever classification their parents are, and if the parents are here illegally, so is the child. The 14th Ammendmend in the US Constitution is pretty explicit in this regard.
But, unfortunately, people have leveraged alien status in order to blur distinctions that conveniently profit from the capacity to get cheap work, deport those who hope to complain about labor theft or compromised working conditions, and compete against US citizen neighbors down the street.
Too many programs extend accommodation to the undocumented illegal alien already - most particularly City and County programs like the local Housing Authority.
Recently, the Governor Jerry Brown signed into policy, in some kind of neoconfederate subtext, a DREAM ACT that assigns our depleting reserves in education to the undocumented, the illegal alien.
So, Chester_Arthur_Burnett, non compliance is running rampant under State, County and Municipal agencies in regards to the illegal alien issue. Other programs sponsored by the County, like the "Healthy Kids Program" doesn't verify US Citizenship status while getting reimbursements on both State and Federal level under the term "Foundation Grant Funding" .. quite the scam.
Gandalf47: Estimates in California is around 3 Million illegals, benefiting public assistance, competing against our own indigent, at the expense of the tax paying US Citizen.
SantaNa (anonymous profile)
April 21, 2012 at 6:50 a.m. (Suggest removal)
The 1% is certainly happy when the rest of us argue over the little bitty things. (Not that CalWORKS is tiny to those that benefit.)
Olegario (anonymous profile)
April 25, 2012 at 8:58 a.m. (Suggest removal)
I remember these great social programs told my mom (after my dad died) that she had to sell the car in order to qualify. But she needed the car in order to go back to work. She kept the car and we survived with head held high.
passagerider (anonymous profile)
April 30, 2012 at 3 a.m. (Suggest removal)
You can't get any assistance until you hit rock bottom and it costs more, never when just a little push is all that's needed.
Ken_Volok (anonymous profile)
April 30, 2012 at 11:28 a.m. (Suggest removal)