The Bush administration’s latest “play now, pay later” tax cut is now the law of the land.
The cumulative impact of the past several years’ worth of federal tax cuts on youth workers, managers, their agencies and the often low-income families they serve should worry all of them.
Entry-level youth workers, almost all single, typically earn between $18,000 and $30,000 per year. Single youth workers earning less than $31,450 will see their taxes reduced by whopping $50 a year under the new law. But – as with all workers earning modest incomes – rising state and local taxes, plus fee hikes, will make any increase in disposable income an illusion.
On top of that, in a field eager to attract new college graduates, the median student loan debt is now $15,375 for public colleges, and $17,250 for private colleges. Monthly loan payments of nearly $200 will make serving children and youth even less attractive for entry-level youth workers.
A $45,000 per year head-of-household human service program manager with two children under 16 will save almost $2,000 a year until the tax cuts expire, according to the Tax Foundation. But by 2011, says the Tax Policy Center, those earning between $22,955 and $80,903 will see their share of federal taxes increase from 25.5 percent to 26.1 percent. And that’s without addressing the annual deficit, which is expected to reach $400 billion this year.
But the most egregious tax shaft from Congress was delivered to the 6.5 million low-wage families raising 12 million children.
House Republicans axed a provision that would have included a $400-per-child increase in the cash-back tax credit to wage earners making from $10,500 to $26,625. During his 2000 campaign, George “Leave No Child Behind” Bush lamented “soldiers … are on food stamps.” Yet among those missing out on the president’s tax break are the children of 200,000 low-income military families. House Republicans said help for working poor families was unaffordable in a $350 billion bill that cut taxes by 15 percent for those earning more than $337,000 annually.
Fortunately, this latest maneuver of the Leave No Millionaire Behind 108th Congress caused a political uproar, led by Sens. Blanche Lincoln (D-Ark.) and Olympia Snowe (R-Maine). The Senate (by a vote of 94-2) and the White House have reconsidered their parsimoniousness. But not House Republicans, who complain that the working poor (average wage: $9 per hour) aren’t paying federal income taxes and so deserve no help in raising their kids.
That assessment of the working poor (a Wall Street Journal editorial called them “the luckie duckies”) is challenged by the report, “The High Cost of Being Poor,” released by the Annie E. Casey Foundation as part of its annual Kids Count report (www.kidscount.org).
Being poor, as anyone who has been impoverished knows, doesn’t come cheap. Car loans, check-cashing and other basic financial services cost more for the poor. Child care, transportation, food and rent take a bigger percent of their income. Of those earning under $25,000, only 26 percent have health insurance, while 83 percent of those earning over $75,000 are covered.
“The best prediction of outcomes for children is the financial security of their families,” the Kids Count report says. It “ain’t going to happen,” says House Majority Leader Tom DeLay (R-Texas) of the child credit to the working poor. When it comes to poor children, apparently, that’s a gift too far.
AmeriCorps: Canary & Canard
For youth agency leaders planning for the future, the meltdown of the federal national service program is ominously instructive.
Once touted by President Bush as the centerpiece of his compassionate conservative agenda, the AmeriCorps program now looks more like the canary in the coal mine for the youth service field. Although not quite dead, the program, which was cut from $240 million last year to $175 million this year, and which once enrolled up to 57,000 members, is slated to drop to as few as 35,000. Some argue that it’s all just an arcane budgeting glitch (see story, page 38) and that a belated infusion of $200 million will provide a quick fix. We hope so.
Backed by a positive national reputation and vigorous supporters on and off Capitol Hill, AmeriCorps will probably survive. But numerous other federal programs will not be so fortunate. The weight of the Bush administration tax cuts will soon crush down on every part of the youth field – even sectors that receive no direct government support. Contractions are already under way in youth employment and training efforts, juvenile justice programs, child welfare services and an array of youth development and after-school centers.
As if these drastic cuts aren’t bad enough, an ignorant Congress persists in its ill-advised penchant for earmarking money to specific youth programs. One egregious example – and there are hundreds more – is ordering the Corporation for National and Community Service, which oversees AmeriCorps, to give $3 million to the Darrell Green Youth Life Foundation (see story, page 1). This canard of a youth program spends $34,000 per child per year for a mediocre after-school program enrolling 38 kids. At the $1,000 annual cost per child for the 21st Century Community Learning Centers program, the same $3 million could serve 3,000 kids. Or it could pay for about 150 AmeriCorps participants for a year.
Thanks, Congress, for rooting out waste, fraud and abuse.