Welfare takes a hit from the slumping economy - Anand

Continuing on my post from two weeks ago and after reading the Kaiser article addressing the issue of the staggering number of uninsured in the U.S., I found this article from yesterday's New York Times fairly interesting.

http://www.nytimes.com/2009/02/02/us/02welfare.html?_r=1&ref=us

Nearly 1.1 million people have lost their jobs already since the most recent recession began. Though the article points out that many of these jobs have been from "white-collar" industries sparing some lower paying jobs, the fact remains that those living off of minimum wage salaries and who are at or near the poverty line, remain extremely vulnerable in times of economic contraction. The first point that seems particularly salient is the fact that federal funding for welfare programs given to states who primarily carry out welfare programs has not grown considerably especially in light of wide fluctuations in case load size. States (California included) must balance their budgets (pay-as-you-go) while the federal government is allowed to run at (record) deficits. States who are already strapped for cash with no stream of additional tax revenue are very reluctant to expand welfare programs and usually tighten restrictions on who gets money when the need is the greatest. Many states who received large block grants (as opposed to categorical grants which have more strings attached) from the federal government began siphoning those funds away from assistance for needy families into other welfare programs and now find themselves unable to reallocate funds properly to the programs which need the most funding. Instead of increasing cash welfare rolls, states are increasing the issuance of food stamps which cost less for them. While it is obviously true that people need to eat, the lack of money transfers from government to citizens (the case for undocumented immigrants is clearly more dire) will directly affect "discretionary" spending on say for instance prescription medications and other necessities. The government is falling short in its obligation to the people and by placing additional stipulations on who gets assistance (i.e. you must enroll in a work program for skills training which disadvantages the disabled). When the need is greatest, the funds should be in place to provide a hand up to those who need it.

In relation to Dr. Wise's talk (which was amazing!), a decrease in welfare assistance is definitely one of those proximate causes that affects health care outcomes. Without money to pay for medical bills or preventive care, a greater percentage of Americans will delay routine procedures leading to complications down the road. While it may be improbable that we can wipe out poverty altogether, it is quite feasible to stem its growth. Healthcare is definitely an area that will suffer from the "panic of 2008" due to the fact that the majority of workers derive health insurance benefits through employment. There is no guarantee, though, that once the economy begins to recover, that the number of uninsured will decline. The resulting problems that we may (or will) face are going to become increasingly intractable as those who need help (throuch Medicare, Medicaid, S-CHIP, etc.) become left behind or disillusioned with a system that is falling short. Any sort of comprehensive stimulus package should take into account the shortcomings of state/federal health-related welfare programs because the wellbeing of the population is at stake.