My CBPP colleague Donna Pavetti makes an interesting point re Rep. Paul Ryan’s new poverty plan. Ryan tells the story of a single mom, Andrea, who needs a multitude of different services and supports that would, he claims, be more readily provided by his consolidated, block-granted system than by the current safety net (see my critiques of his plan here and here) .
But Donna argues that:
…nothing in Chairman Ryan’s proposal would make it more likely that families in Andrea’s situation would receive that full package of supports unless other needy individuals and families receive significantly less help.
Because many anti-poverty programs, including housing, child care, and cash assistance, are significantly under-resourced, it’s already the case that many people–most, in fact–who are eligible for a program do not receive any benefits from it.
Today, just 25 of every 100 poor families receive TANF assistance, only 1 in 7 low-income children who qualify for help paying for child care receives it; and just 1 in 4 low-income households that qualify for help paying for housing get it.
Now, couple these insights with the fact that Rep. Ryan’s plan is revenue neutral, and you see where Donna’s coming from: given a fixed budget that’s already tightly constrained, the only way Andrea’s family gets more services is if someone else’s gets less.
It’s a similar point to the one made in the context of revenue neutral tax reform that pays for a rate cut with a base broadening. Everyone likes the idea because they think it will lower their taxes. And, in fact, some people’s taxes will fall (typically those not benefiting from any loopholes). But the unforgiving arithmetic implies that given revenue neutrality, if somebody’s tax bill goes down, somebody else’s is going to have to go up.
Rep. Ryan, unsurprising, told us a lot today about the alleged winners of this lottery. He somehow neglected to mention the losers.