After multiple hurricanes caused billions in damage over the past two years, Louisianans are still waiting on long overdue federal disaster assistance. This week, however, Congress advanced a much-needed aid package that includes $28.6 billion for communities hammered by natural disasters, including many in Louisiana, as part of a larger bill to lift the debt ceiling and to fund the federal government past the end of this month. While the House passed the bill, political opposition from Republicans threatens to stall the bill — and the aid it would provide to the state. Blake Paterson of The Advocate has the story:
Sen. Bill Cassidy, R-Louisiana, said Tuesday the United States couldn’t afford to let nearly two years worth of natural disasters go unaddressed any longer. But in a narrowly divided Senate, Cassidy said a bill that suspends the debt ceiling wouldn’t get enough support from his Republican colleagues to pass. (…) “I am committed to disaster assistance,” Cassidy said. “They give me all these variations, it includes this, it includes that, it includes this or that. I say just show me the bill and I will tell you how I am going to vote. But I am committed to voting for disaster relief. We got to get relief to folks back home.”
If Congress fails to lift the debt ceiling, the United States would default on its financial obligations for the first time in history, likely leading to severe economic consequences, including a near doubling of the unemployment rate and the loss of $15 trillion in household wealth. Meanwhile, people in some of the hardest hit areas of the state are living in tents while they wait on federal aid. JC Canicosa of the Louisiana Illuminator has the story:
Lafourche and Terrebonne parish residents displaced by Hurricane Ida have been sleeping in tents and “using the rubble to build their own sort of makeshift structure” since the storm made landfall last month, said Speaker Pro Tempore Tanner Magee during a legislative hearing Monday.
A bright spot in Louisiana higher education
Consistent cuts to state funding for higher education have left Louisiana families facing higher fees and tuition at the state’s colleges and universities, making it harder for people with low- and moderate-incomes to afford to go to school. This self-defeating cycle has cost Louisiana, but temporary increases in federal aid have injected much-needed dollars into state and institutional budgets. As a result, Louisiana’s public institutions of higher learning are seeing a funding boost for the first time in over a decade. Will Sentell of The Advocate explains:
“We think we are going to be performing pretty well,” [Commissioner of Administration Jay] Dardenne said during the first day of budget hearings for spending that will be mapped out next year. State aid for colleges and universities rose by about $175 million earlier this year, a rarity after 13 years of budget cuts or standstill budgets. Dardenne, who is Gov. John Bel Edwards’ chief financial lieutenant, said colleges can expect the governor will recommend money for mandated costs next year and “hopefully” a hike in state aid for operations.
In the Build Back Better plan, a fairer tax structure for America
Low-income households pay a much higher share of their income in state and local taxes in Louisiana than their wealthy neighbors. This unfair tax structure asks the most of those least able to pay. Now, Congress is debating a tax package that would help balance the scales while funding important programs Americans need and want. The tax plan that passed the U.S. House Ways and Means Committee as part of President Joe Biden’s Build Back Better proposal, would help America move forward while giving the vast majority of Louisiana families a tax break. The plan would fund new investments largely by raising taxes on rich people. Steve Wamhoff and Matthew Gardner of the Institute on Taxation and Economic Policy explain how the bill would make our federal tax system more progressive:
The revenue-raising provisions in the bill would raise $2.1 trillion over ten years according to Congress’s official revenue-estimator, the Joint Committee on Taxation (JCT). The bill’s tax increases fall into three categories. The first would raise individual income taxes (including the personal income tax and other individual income taxes) on the rich. The second would increase corporate income taxes. The third would increase taxes on tobacco and nicotine. This report finds that the vast majority of these tax increases would be paid by the richest 1 percent of Americans and foreign investors. The bill’s most significant tax cuts – expansions of the Child Tax Credit (CTC) and Earned Income Tax Credit (EITC) – would more than offset the tax increases for the average taxpayer in all income groups except for the richest 5 percent.
The costs, to mothers, of welfare “reform”
The welfare “reforms” of President Bill Clinton’s administration devastated government assistance to poor families through massive funding cuts over time and punitive rules that, among other things, diverted child support payments from children in need to state government coffers. As a result, in Louisiana, fewer than 4% of children in poverty now receive cash assistance through the Temporary Assistance to Needy Families program, a drop from 48% in 1996. Eli Hager of ProPublica takes a deep dive into how child support cooperation requirements written into Clinton-era changes in cash assistance continue to harm mothers and their children:
[A]llowing child support to flow to families makes low-income mothers more likely to work, because they can afford child care. And every dollar that goes to moms and kids saves the government many times more in the future, when they will be less likely to rely on social programs like food stamps and Medicaid. Finally, several experts said, going after child support to recoup welfare is only marginally cost-effective for the government. That’s in part because fathers in TANF cases are so often poor themselves, and pursuing payment can require tracking them down, taking them to court or jailing them at taxpayers’ expense. Yet the New Mexico Human Services Department and many others across the country continue pressuring poor single mothers to sign over their child support rights to the state to keep that trickle of revenue flowing.
One New Mexico mother shares her experience in navigating the state’s harsh child support cooperation requirement and the impact it has on her kids:
Curshelle Vann, another mother in Albuquerque, said the government “demeans you” about going after child support to repay welfare, especially if you’re Black, Hispanic or Native American. “I didn’t think they’d be so nasty about the father,” said Vann, who is Black. “If I don’t know where he works or any of that, they shouldn’t cut off money for my children.”
Number of the Day
$1,170 – The reduction in 2022 taxes for the poorest 20% of American households – those with about $11,400 in income under the tax changes that passed the U.S. House Ways and Means Committee as part of the Build Back Better plan (Source: Institute on Taxation and Economic Policy)