Yesterday the Senate held a much-publicized vote on the “Buffett Rule,” a basic measure of fairness that would ensure millionaires don’t pay a lower tax rate than their secretaries. Conservatives dismiss this proposal as a distraction, scoffing at the fact that it would raise only $47 billion in new revenue over 10 years.
That’s actually a lowball estimate. The Buffett Rule legislation authored by Sen. Sheldon Whitehouse (D-RI) is expected to raise more than three times that amount, or at least $160 billion, because the number that Buffett Rule opponents cite assumes that all the Bush tax cuts expire, which would result in more than $800 billion in revenue over the next decade from high-income households. Rep. Tammy Baldwin (D-WI) introduced companion legislation and is pressing for a House vote on it.
But even more telling is the fact that conservatives dismiss these sums as paltry while they are taking a knife to nutrition assistance in the name of reducing the deficit. Even as the Senate was debating the Buffett Rule, the House Committee on Agriculture released its own proposal to find budget savings. Rather than focus on subsidies to large agribusiness under their jurisdiction at a time of high farm profits, the committee decided that kids, the elderly, the working poor, and people with disabilities should bear the brunt of deficit reduction.
The House Agriculture Committee found nearly all of its savings ($33.2 billion over 10 years and less than what the Buffett Rule would raise even under the low scenario) from the Supplemental Nutrition Assistance Program. This translates into an 11 percent cut in the monthly benefit for an average family of four. The proposal would also change the rules of the program to make it more difficult for families who fall on hard times to access benefits, reduce coordination with other forms of assistance, and force families who lose a job to spend nearly all their savings to get temporary help.
Here are the specifics:
These cuts would truly affect the most vulnerable in our society and the working poor. Three out of four households receiving nutrition assistance have a child, and 25 percent have an elderly person or a person with disabilities in them. Additionally, three times as many program households have income from work than from welfare.
But these cuts do more than hurt those struggling against hunger. They harm our overall economy. The Supplemental Nutrition Assistance Program provides the biggest “bang for the buck” in terms of job creation, creating $1.73 in economic activity for every dollar spent on the program. Similarly, a $1 billion cut from the program results in more than 13,700 lost jobs. In contrast, tax cuts for the wealthy are one of the weakest options for job growth because those households tend to save the extra cash from a tax cut rather than spending it in the economy.
Conservatives claim we need to cut nutrition assistance for struggling families to cut the deficit. But in the same week, they are rejecting the Buffett Rule proposal that would cut the deficit by an even greater amount by asking millionaires to pay the same tax rate as middle-class families. Their priorities are crystal clear.
Melissa Boteach is Director of Half in Ten at the Center for American Progress Action Fund. Seth Hanlon is Director of Fiscal Reform for the Doing What Works program at the Center for American Progress.
Senior Vice President, Poverty to Prosperity Program