President accused of neglecting poor

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One day after President George W. Bush presented the most austere budget of his presidency, advocates for the poor were working hard to paint him as a Robin Hood in reverse - a president who robs the needy to give to the rich.

The White House's budget recommendations to Congress contained a number of painful cuts to programmes for those on low incomes, while underlining again the cost of extending the tax cuts of Mr Bush's first term, which largely benefited the well-off.

The budget proposal to cut food stamps for low-income Americans who have modest savings would exclude 200,000-300,000 families from coverage. A freeze on child care funding to the states will mean that 300,000 fewer low-income children will be assisted by 2009.

There are also worries that efforts to cut $45bn (€35.2bn, £24.2bn) over the next decade from federal support to Medicaid which provides healthcare benefits to the poor would lead states to reduce their coverage.

Margy Waller, a specialist on poverty at the Brookings Institution, said the cuts could take a heavy toll.

“This budget is at least as bad and probably worse than the Reagan budgets of the 1980s in terms of its impact on the poor,” she said, referring to President Ronald Reagan's efforts to bring the budget back into balance after a large tax cut.

Poverty experts also stressed on Tuesday that programmes for the poor had done little to contribute to the rising deficit which has ballooned largely due to tax reductions and rising defence spending.

Next year the annual lost revenue attributable to Mr Bush's tax cuts from his first term will be about $190bn. The cuts in domestic programmes proposed for 2006 by the White House, meanwhile, would save $20bn.

“These savings are relatively trivial in terms of reducing the budget but will have a very large impact on the most vulnerable Americans,” said Dorothy Rosenbaum, senior policy analyst at the Center on Budget and Policy Priorities, a left-leaning think-tank in Washington.

Although the budget has already caused rumblings in Democratic ranks, they are ill-placed to protect programmes for low-income Americans. Some legislation can be blocked through a filibuster in the Senate, which would require 60 votes to overcome, but this is not allowed on budget resolutions, so the Republicans only need 50 votes. The Democrats have only 44 senators and several of the centrist Republicans who occasionally defect to the Democrats are fiscally conservative and may welcome measures to cut the deficit.

The poor may find their most potent defenders among Republican governors and local officials.

The states have been worried by efforts to reduce federal support for Medicaid, which already represents about a fifth of state budgets. The cost is growing by about 10 per cent a year.

The financial burden of Medicaid is split, with the federal government matching 50-77 per cent of the costs, depending on the wealth of each state.

“What Mr Bush is proposing is a serious threat to a funding stream that local and state governments rely on,” said Ms Waller. “There is likely to be some serious push back from local and state officials and a good degree of responsiveness from congressmen.”

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