Congress reversed its usual procedures in the first year of the Bush
Administration, passing its budget resolution before seeing the President's
detailed proposal for the nation's economy. The normal timetable would have
the President sending his budget request to Capitol Hill prior to the
legislators deciding how much they want to give him of what he is seeking.
This year, the governing issue clearly is attempting to give the largest tax
cut possible while increasing spending as little as possible.

On February 28 the White House released a preliminary outline of how the
budget would look when it was finally proposed on April 9. That draft made
it clear that some areas important to low-income people would be either
actually reduced or held at rates of increase that do not keep up with
inflation. The release on April 9 of the formal budget proposal confirmed
that intent.

Funding for the Food Stamp Program and a variety of child nutrition
entitlement programs will be held level if the Administration proposal is
accepted, meaning that no funding is provided for major improvements in any
of these programs, nor is increased utilization (which is likely as the
economy worsens) anticipated.

The WIC (Women, Infants and Children) program, which provides nutrition
assistance to poor pregnant and nursing women and their pre-school children) would be funded below the level of actual need, even though WIC is widely regarded as one of the most valuable and effective nutrition and health
programs for young children. The Elderly Farmers Market Nutrition Program
and the Community Food and Nutrition Program would be eliminated, according to the Bush plan.

To address some of the increasing nutrition needs of poor people in the
U.S., Senators Kennedy (D-MA) and Specter (R-PA) have introduced S. 583,
"The Nutrition Assistance for Working Families and Seniors Act". This bill
would restore Food Stamp Program eligibility for poor legal immigrants,
increase benefit allotments for elderly people receiving the $10 minimum
allotment and families with children, expand funding for TEFAP (The
Emergency Food Assistance Program, which makes surplus food available to
poor people), and help connect eligible people to benefits in other programs
that would assist them.

Other crucial programs intended to reduce poverty will experience actual
reductions unless Congress amends the President's budget. For example, the Head Start program would have to drop 2,500 children who are currently
enrolled, in order to stay within the Bush budget.

Despite the President's commitment to improving educational opportunities
for poor children, he proposes to eliminate all funding for the Early
Learning Opportunities Act, funded at $20 million in the current fiscal year
to provide resources to communities for more responsive early childhood
systems, including parent education and family support services.

Child care funding, which is absolutely essential to the success of welfare
reform, is cut in the President's budget, which would take $200 million away
from the Child Care and Development Block Grant, redirecting it to a new
after-school voucher initiative Mr. Bush wants to try. Only 12% of eligible
children now receive the child care assistance to which they are entitled.
The Administration proposal would simply redirect resources away from care
of infants and toddlers to school-aged children.

Another troubling proposal would actually cut the Social Services Block
Grant (Title XX) funding used by states to serve at-risk children and
families by $25 million of its current $1.7 billion. Title XX funds have
been greatly reduced over the last few years and states have made up for
part of the shortfall by redirecting unspent funds from the Temporary
Assistance to Needy Families (welfare) Program into Title XX. The 1996
welfare law allowed them to put as much as 10% of TANF money into Title XX
to help families leaving welfare for work with necessities such as job
training, transportation to work, and child care.

Mr. Bush recommends both cutting Title XX funds and restricting the amount
that states can add to Title XX from TANF to 4.25%. Because of the robust
economy, many states were not spending all of their TANF money for income
support to welfare recipients, but had chosen to use some of it for
supportive services to help those leaving welfare. As the economy becomes
more troubled, it is likely that states will need to spend more for income
support. Since the President has proposed no plan to deal with increased
need for welfare in the event that people need to return to the rolls
temporarily, it appears that the reduction in TANF funds transferred to
Title XX is intended to take care of increased need. There would be,
however, no other source of funds for the supportive services TANF has been
providing through Title XX, which would be more greatly needed if the rolls
increase.

Seventeen states with particularly dire poverty situations or rapidly
increasing populations of poor people have, under the 1996 welfare law, been receiving supplemental grants to help them deal with their special problems. Mr. Bush proposes eliminating the grants, meaning those states will have from 2.4% to 10.4% less funding available for anti-poverty purposes in FY2002. A major use of the funds was to increase state spending on poor
children in those states, whose average child poverty rate is nearly 20%
higher than that of the rest of the country.

In keeping with his emphasis on having faith-based organizations meet the
social service needs of low-income people, Mr. Bush has proposed diverting
welfare funds from the TANF program to reimburse states for part of the tax
revenues they lose by enacting a tax credit for charitable contributions.
He would allow states to give a tax credit up to 50% of the first $1000 a
couple gives ($500 for a single person) to anti-poverty charities.

General Assembly guidance:

The General Assemblies of the Presbyterian Church have been consistent over the last 30 years in calling for a tax system that is fair and progressive in raising funds for a federal budget, with reduced military spending and an increased commitment to protecting and equipping vulnerable people. In our current situation, with a commitment to pay down the national debt as well as future hope for revenue surpluses, how our nation budgets its resources is a key moral issue. Perhaps the most direct Presbyterian guidance comes from the 1990 Assembly, which urged the President and Congress "to place the highest priority on developing a legislative program (a) to more adequately meet social and economic needs, and (b) to reduce the federal deficit. To the extent this cannot be done by reducing military or other spending, the Assembly requests them to approve legislation (a) to increase taxes and (b) to make the tax structure more equitable and progressive."