By Marie Cocco
There will be no freedom from want. The only thing we might now hope for is freedom from fear. Even that is a distant state of mind.
It is not just the wild fluctuations in the stock market, the water-cooler jokes about retirement accounts that are now 201(k)s. It is the incomprehensible dithering of our current president through his lame-duck period, his bizarre refusal to give approval to any economic package that aided anyone or anything that is not a big bank or a Wall Street financial institution.
This delay may well be the scariest development of these frightening times.
What are the reasons for President George W. Bush to have blocked the post-election congressional effort to make a down payment on an anti-recession program aimed at job-creation and sending money to the squeezed states, which must balance their budgets while struggling with ever-rising demand for basic services such as Medicaid and what remains of the program we used to call welfare? Bush has argued, at various times in the past few weeks, either that such a package isn’t really necessary or that it might be possible if it were tied to a long-term trade deal with Colombia. The reasoning tortures the mind.
Besides inheriting an economic crisis of historic proportions, President-elect Barack Obama must make up for the squandered time. But at the earliest, it is likely to be at least February or March before the first dollar of an Obama recovery plan is felt.
This is a national disgrace.
Consider, for example, that one of the leading indicators of poverty—a rise in the number of people eligible for food stamps—climbed 10 percent between August 2007 and August 2008. According to the Center on Budget and Policy Priorities, which studies the impact of federal policy on the poor and working class, one in five children already receives food stamps, a rate that is comparable to the recessions of the early 1980s and the 1990s. Advocates for the poor are expecting that a record number of Americans will be receiving food stamps once new numbers are tallied over the coming weeks.
And we aren’t deep into this recession yet. Economists believe that unemployment will climb to 8 percent or even 9 percent next year.
As it happens, right around the time we became politically enamored of deregulating whole industries—and so prepared the ground for the current economic morass—we also became politically obsessed with shrinking the social safety net. It was too generous, the thinking went, and had to be made less so to encourage work and discourage dependency.
We are entering a recession the likes of which we haven’t seen in about three decades or perhaps longer. Since the last time the economy fared so poorly, changes in the unemployment compensation system, coupled with a transformation of the labor force to include vastly more part-time and low-wage workers, have left a majority of workers unprotected by this basic benefit. “Unemployment benefits cover a smaller set of workers than they did in the late 1970s and early 1980s,” says Sharon Parrott, director of welfare reform and income support research at the Center on Budget and Policy Priorities. Fewer than 40 percent of unemployed workers now are eligible for benefits.
And we haven’t yet tested—not on this scale anyway—what really happens to the welfare-to-work system when there is no work.
Welfare revision was a signature cause of the 1990s, a centerpiece of President Bill Clinton’s drive to remake the Democratic Party’s image and a relentless demand of congressional Republicans determined to dry up what they considered wasteful social spending. Basic cash assistance to the poorest families has shrunk substantially since the 1970s and 1980s. In most states, adults who have no children and are not disabled are ineligible for any aid. Single mothers who may have lost their jobs now have time limits on the number of months they can receive public assistance. To cope, Parrott says, “they’ll double up, they’ll live with friends, they’ll move from house to house, which is very bad for kids.”
We have lavished hundreds of billions of taxpayer dollars on the financial masterminds whose collective genius has brought us these desperate times. Some of those taxes were paid by the now-unemployed workers who don’t qualify for benefits. Having socialized the financial system, there is no excuse now for failing to repair the social safety net.
Marie Cocco’s e-mail address is mariecocco(at)washpost.com.
© 2008, Washington Post Writers Group