The United States is currently dealing with a fiscal showdown and is less than two weeks away from sequestration—a range of severe, across-the-board budget cuts to federal programs—along with tax increases that will automatically go into effect January 1, 2013, if lawmakers fail to reach a compromise on taxes and spending by the end of the year. But even with this deadline looming, negotiations appear to be stalled, as conservatives resist the call to increase tax rates for the wealthiest Americans.
Debates about the budget can sound opaque and irrelevant to our everyday lives, but the impact of these negotiations will directly affect the future of all Americans. Indeed, cuts to federal programs are especially relevant to faith communities, many of which rely on federal and state funding for their faith-based work. Catholic Charities, for instance, receives more than 60 percent of its budget from federal funds.
While debates continue over cuts, hikes, and compromises, faith groups are taking a stand for programs and policies that support all Americans—since the vast majority of America’s faithful, just like most of the overall population, opposes cuts to federal programs that help the poor. It’s at times such as these that we must ask: How do the policies being discussed by our elected officials match up with our morals? How would these policies affect houses of worship and the millions of people they serve?
Drawing upon values shared across religious lines—feeding the hungry, caring for the poor and less fortunate, giving to others, healing the sick, and caring for the elderly—here are five reasons why people of faith care about the fiscal showdown.
Feeding the hungry: Nutrition assistance
The Supplemental Nutrition Assistance Program helps the millions of Americans who are struggling with hunger afford food—an especially needed service in the midst of an economic recession. But as lawmakers rush to reach an agreement by December 31, the program—which is already unable to reach many affected by poverty—could end up being cut by billions of dollars by elected officials looking to find savings. This would force millions more American families to go hungry.
Various faith groups—including the Presbyterian Church (USA) and the United Methodist Church—have issued statements urging elected officials to remember the poor when addressing our nation’s fiscal concerns. Additionally, Galen Carey, vice president of government relations for the National Association of Evangelicals, has called upon fellow Christians to write letters to their representatives in Congress during the holidays, urging them to take the issue seriously. He said:
We encourage Christians to take time, as they prepare holiday baskets, visit nursing homes, and volunteer at shelters and rescue missions, to take five minutes to write a simple letter to their representative and senators, assuring them of their prayers, and asking them to maintain a circle of protection around poor and hungry people this Christmas and throughout the year.
Some lawmakers argue that charities, not government programs, should do the work of feeding the poor. But while thousands of churches and faith-based charities work tirelessly to feed the needy with effective programs, they are unable to keep up with demand. Indeed, faith leaders continue to insist that helping the needy should be “a joint effort between the government and the governed.”
Cutting nutrition assistance will not only hurt millions of people in poverty—it will leave already-overburdened churches and faith-based charities unable to provide for families struggling against hunger.
Caring for the struggling middle class and the poor: Tax credits that help working families
Tax provisions aimed at helping lower-income working families will vanish if a budget deal isn’t reached by the end of the year. The temporary payroll tax cut, which was extended last year and designed to help struggling middle-class families during the economic recovery, will disappear, as will expansions of the child tax credit, the earned income tax credit, and extended federal unemployment insurance.
Failure to extend these tax credits would also raise taxes on as many as 25 million families and leave many hardworking Americans and their families in dire straits. In response to this threat, faith groups are speaking out against policy decisions that could hurt working families. Among them is the Circle of Protection—an ecumenical consortium of faith groups that includes the United States Council of Catholic Bishops, the American Jewish World Service, and the Islamic Society of North America, among others. The group recently issued an open letter to President Barack Obama and Congress, urging them to remember the poor during their budget negotiations. The letter said:
As [religious groups] do all we can to help families and individuals living in poverty, we need our elected leaders in Washington to do the same. … we see effective programs that meet the needs of the poor and vulnerable and help keep others from slipping into poverty: those programs and tax credits—such as Medicaid, SNAP (formerly food stamps) and the Earned Income Tax Credit—should be maintained. As our nation approaches a “fiscal showdown,” there are difficult decisions to be made, but we believe this can be done without putting the burdens on those who can least afford it.
Faith groups, similar to most Americans, see infringements on programs and tax policies that help the less fortunate as unjust, especially in a period of economic recovery.
Generous giving: Charitable deductions for donations to faith-based charities
Under the current tax system, taxpayers get a deduction if they donate to charitable causes and itemize those deductions on their taxes. This deduction—which has been in the U.S. tax code since 1917—essentially incentivizes giving to charitable organizations. Faith-based institutions and charities often rely on contributions from major donors, and many say their donations are significantly bolstered by the incentive created by the charitable deduction.
In the midst of budget debates, however, negotiators have discussed lowering or even doing away with charitable deductions in order to raise more revenue. Among the more dramatic suggestions is a plan that was originally floated earlier this year by then-presidential candidate and former Massachusetts Gov. Mitt Romney. His plan would place a dollar cap on all itemized deductions—say, $25,000, $50,000, or even Gov. Romney’s original suggestion of $17,000—including the charitable deduction. The plan, which has resurfaced in recent budget talks, would essentially cause many Americans to reach their deduction “cap” before they even get to the charitable deduction, effectively eliminating the incentive to donate to charity for tax purposes. A new report by the National Economic Council indicates that this kind of dollar cap would likely cripple most charitable organizations, including faith-based charities, by significantly reducing the incentive for major donors to make large contributions. According to the report, the plan would reduce charitable giving by hundreds of billions of dollars over 10 years.
Several other plans are also being suggested. The Center for American Progress, for example, recently produced a tax plan that would effectively cap charitable tax credits—in this plan, all deductions are converted into tax credits—at 28 percent of an individual’s income, as opposed to a dollar cap. President Barack Obama also offered a 28 percent cap early in negotiations, but recently suggested sparing the charitable deduction from cuts by keeping it at its current rate—35 percent.
Regardless of disputes on Capitol Hill, faith-based and secular charities are working to educate the federal government about the need to protect charitable deductions. Earlier this month, the Charitable Giving Coalition—which includes members such as Catholic Charities USA, Jewish Federations of North America, and the Council for Christian Colleges & Universities—held a two-day event titled “Protect Giving – DC Days” aimed at convincing lawmakers about the need to preserve charitable deductions.
The heads of many major faith-based charities are becoming increasingly vocal about the issue. Father Larry Snyder, president of Catholic Charities USA, stated that “if tax deductions are capped, there will be a definite decrease in the philanthropy that charities will see.”
It is true that people often give to houses of worship and faith-based charities out of a sense of religious duty. Still, simply lessening the value of tax deductions could significantly reduce the amount of money faith-based charities get every year—money used, often with little overhead, to serve those most in need.
Healing the sick and caring for the elderly: Cuts to Medicare, Medicaid, and Social Security
Other important programs that faith groups worry will end up on the chopping block during negotiations include Medicaid, Medicaid, and Social Security—programs that offer vital support and life-saving health care to America’s poor and elderly.
Although there has been relatively little talk of cutting Medicaid so far during fiscal showdown, the same isn’t true for Medicare: Lawmakers are discussing billions of dollars’ worth of cuts to the health care program as part of a deal—as much as $400 billion over the next 10 years. True, these cuts can be targeted in ways that protect seniors, but some are still concerned about what will be lost at the negotiation table. Worse, Republicans continue to offer up a plan to raise the minimum eligibility age for Medicare from age 65 to age 67, a move that could raise the price of insurance for everyone and leave hundreds of thousands of seniors at risk of being uninsured.
Meanwhile, although Social Security was originally thought to be safe from negotiations, it has recently been slotted for cuts by both parties.
America’s faithful, however, are speaking out on behalf of the poor, sick, and elderly. Religious leaders from 16 states recently convened in Washington, D.C., to ask lawmakers “not to make cuts to Medicare, Medicaid or Social Security that place an additional burden on vulnerable Americans or those living in poverty or that cause more people to fall into poverty.”
Additionally, the Virginia Interfaith Center has joined secular organizations such as the AFL-CIO and the Virginia New Majority in asking Sens. Jim Webb (D-VA) and Mark Warner (D-VA) to prevent cuts to Medicaid, Medicare, and Social Security.
For many religious Americans, diminishing the quality of health care and cutting back on programs that help seniors don’t match up with their call to serve the needy; in fact, cutting programs such as Medicare, Social Security, and Medicaid can actually create more needy Americans—a price faith groups refuse to pay.
Values: How we spend our money reflects our beliefs
The debate over the fiscal showdown is more than political showmanship: How the federal government spends our money is a reflection of what we value as a nation.
These decisions matter. If the Supplemental Nutrition Assistance Program is cut, people will go hungry. If tax credits that help poor and struggling middle-class families disappear, millions might fall into poverty. If giving to charitable organizations is reduced, services for the needy will suffer. If funding for Medicare, Medicaid, and Social Security is slashed, America’s poor and elderly may end up with insufficient health care or even become uninsured.
With this in mind, people of faith—a community that has long fought for the underprivileged in the United States—are making their voices heard during this fiscal showdown. It remains to be seen whether Washington will listen, but in the midst of these budgetary discussions, the faithful are standing alongside their fellow citizens to remind our elected officials that society’s most vulnerable—the hungry, the elderly, the poor, the sick, and the needy—should be reflected in and protected by our national policies.
Jack Jenkins is a Writer and Researcher with the Faith and Progressive Policy Initiative at the Center for American Progress.