No one should be surprised that solving our dumbest fiscal policy, the federal debt ceiling, involved our dumbest social policy, work requirements for aid programs.
But that seems to be the case. In negotiations between Biden’s White House and House Speaker Kevin McCarthy’s Republican caucus, one of the final sticking points was whether, and by how much, to tighten work requirements for coupons. food and social assistance.
In the coming days, as Congress heads into the votes on the deal, political commentators will mull over whether Biden or McCarthy (R-Bakersfield) prevailed in this deal and which of them will be hurt or harmed politically by the outcome.
Democrats are currently prepared to default on debt so they can continue to pay welfare benefits to people who refuse to work.
Rep. Garret Graves (R-La.) Tells a Giant Lie About Debt Ceiling Negotiations
It’s not a very interesting board game. (Personally, I would go with the judgment of New Republic’s Timothy Noah, who thinks Biden is emerging as the political winner and McCarthy’s days as president are numbered, thanks to his far-right choler.)
More important is what the agreement says about the principles of both sides. The granular details of the deal were still hazy on Sunday, and it could still unravel due to objections from Republicans or Democrats in Congress.
The deal, as reported, freezes discretionary federal spending — meaning most programs Americans depend on the federal government for — at current levels for the next two years, with increases below the inflation. This means an effective budget cut, relative to inflation. In return, the debt ceiling is suspended for two years.
But Biden has managed to keep the accomplishments of his presidency thus far away from the knives of the GOP. He pushed back on their efforts to torpedo support for renewable energy in last year’s Cut Inflation Act, their toughest proposed budget cuts, the reduction of student debt relief and the repeal of his budget increase for the Internal Revenue Service.
(Reports say $10 billion will be cut from the IRS budget increase of $80 billion over 10 years, but the money may be redirected to other programs.)
Biden rejected Republican demands to impose work requirements on Medicaid, but allowed some tightening of rules for food stamps — the Supplemental Nutrition Assistance Program, or SNAP, and Temporary Assistance for Needy Families, or TANF, which is what’s left of traditional welfare.
Make no mistake: no wealthy American will be harmed even a little by this deal. Some may even benefit if the exclusion from the IRS budget stems from the agency’s enforcement efforts; it would help the wealthy, who are the worst tax cheats in the country.
The most vulnerable Americans, however, will bear the brunt of the deal’s points. We’ll take a look.
Start with the job requirements. As I reported To infinity over the years, the work demands of safety net programs do nothing in terms of pushing their beneficiaries into the labor market.
They are, however, very effective in excluding people from these programs; that’s what happened in Arkansas, where 17,000 people lost Medicaid benefits in 2019 after just six months of limited work rule rollouts. A federal judge then blocked the changes.
The debt ceiling agreement will tighten work requirements for SNAP by requiring low-income, childless, able-bodied adults under age 55 to work 20 hours a week or attend training or seek employment. If they don’t meet this standard, their SNAP benefits end after three months. The current law only applies to adults up to the age of 49. The change will expire in 2030.
This rule will do next to nothing to reduce federal spending, which Republicans say has been the whole point of holding the debt ceiling hostage. The Congressional Budget Office estimated in April that the change would cut federal spending by $11 billion over 10 years, or $1.1 billion a year.
By my calculations, that’s 17 thousandths of a percent of the federal budget, which this year is $6.4 trillion.
While this is hardly a rounding error in the federal accounts, it is nevertheless of crucial importance for the recipients of food aid. The CBO estimated that about 275,000 people would lose benefits each month because they failed to meet the requirement.
Biden negotiators got Republicans to waive SNAP rules for veterans and the homeless, which will likely lower that number and limit federal spending cuts.
Work requirements for safety net programs have been a Republican workhorse for decades. It is based on the Republican image of low-income Americans as slackers and crooks – the “unworthy poor”.
Sure enough, Rep. Garret Graves (R-La.), one of McCarthy’s debt ceiling negotiators, couldn’t resist slandering this vulnerable population during the talks. “Democrats are currently prepared to default on debt so they can continue to pay welfare benefits to people who refuse to work,” he said during a break.
Of course, it’s the Republicans who have shown themselves willing to default on the federal debt. Nor is there any evidence that a significant percentage of this target population is “unwilling to work”.
The vast majority of SNAP recipients are already working, but they work in low-paying jobs that are so unstable that they often move in and out of employment. According to the Census Bureau, 79% of all SNAP families include at least one worker, as do nearly 84% of married couples on SNAP.
In other words, the GOP’s insistence on work demands is nothing but the party’s typical performative malevolence toward the poor. If they were serious about getting SNAP recipients into the labor market, they would fund job training programs and infrastructure projects. They never do.
However, the only cohort of recipients that tends to enter the workforce are younger recipients, not those in their 50s. All that work requirements accomplish is erect bureaucratic barriers to safety net enrollment. But that’s the point, isn’t it?
TANF’s work rules are handled somewhat differently — they are aimed at the states administering the program, which have been required to ensure that a certain percentage of recipients are working or looking for work. How the debt ceiling agreement applies to this program is unclear.
Over the next week, before June 5 – the alleged date when the Treasury Department says the government is running out of money to pay its bills without raising the debt ceiling and thus flirting with an unprecedented default – Biden and McCarthy will hit the hustings to claim victory.
But there’s really only one way to think about the exercise we just did. It was a supreme waste of time.
Republicans have shown they are ready to crash the US economy to issue unprecedented complaints about the federal deficit, which they themselves created mostly through the 2017 tax cuts that they enacted for the rich. Their initial negotiating stance was so extreme that they must have known she could never get House Democratic votes or advance to the Democratic Senate.
The Democrats held on reasonably firm. They agreed to modest budget constraints for two years, moved the next debt ceiling cabaret beyond the next election, and saved millions of Americans from serious economic hardship.
As I’ve written before, if Republicans were really serious about federal spending restraint, they wouldn’t have voted for the tax cuts and budget increases that contribute to the deficit.
Instead, they said the only way to control spending was to refuse to pay the bills they racked up, refusing to raise the debt ceiling. They lied, and any thinking American knows they lied. So tell me, why did we go through this again?
This story originally appeared in the Los Angeles Times.