Looming Block Grant Cuts May Stun Community

For years, the start of every new congressional session has sparked cries of alarm from Jewish health and human service providers about the possibility that campaign talk about taming the runaway budget deficit would produce slashed appropriations and decimated programs.

And for years those fears proved largely baseless as lawmakers gave in to the political reality that for all their talk about the deficit monster, voters hate cuts to programs that serve their own communities.

But William Rapfogel, executive director of the Metropolitan Council on Jewish Poverty in New York, is pretty sure things will be different this time around. That’s because federal block grant funding — crucial to some Jewish service providers, especially those in big cities — are likely in peril.

“In the past we’ve talked about a perfect storm affecting federal, state and local funding,” Rapfogel said. “It’s different now; it’s a perfect storm on top of a tsunami on top of an earthquake.”

New York agencies serving vulnerable populations — including the swelling population of the Jewish poor and elderly — have in the past seen the impact of local and state budget cuts ameliorated to a degree by federal programs.

“But that’s not going to happen this time around,” Rapfogel said. “I’m not using scare tactics when I say people will die because of what’s happening.”

As the new Congress tries to pass a continuing resolution keeping funds flowing for the current fiscal year and starts jousting over next year’s budget, numerous Capitol Hill observers agree that last year’s electoral upheaval and this year’s opening skirmishes in the budget battle portend a war that will be different from anything the nation has seen in the past.

“It’s absolutely different,” said Mark Pelavin, associate director of the Religious Action Center of Reform Judaism, a group with a strong social justice focus. “The new House leadership means what they have said; they are very serious about reducing the size of government almost everywhere.”

Note the word “almost.” Neither lawmakers in both parties nor the Democratic president are calling for substantial cuts in the immense defense budget or serious entitlement reforms. That, Pelavin said, means that there’s more anti-government ideology at work here than a real desire to shrink the deficit.

The unfolding battle is “the most dramatic display yet of differences over the role of the government,” he said.

Adding immeasurably to the likelihood of painful cuts is a Democratic president who seems to be using domestic budget cutting to veer to the political center in advance of next year’s elections.

Shadowing the budget debate and driving much of the agenda for congressional Republicans is a Tea Party movement that wants to see solid evidence of change on the budget front, not just the usual huffing and puffing.

“Everybody is looking over their shoulders and wondering just how far this will go,” said a congressional staffer involved in the budget debate. “The Republicans are scared the Tea Partiers will make them irrelevant if there isn’t blood on the floor; the Democrats are afraid voters will turn them out for Republicans next year if there aren’t really big cuts. The question is, are people here more afraid of the Tea Parties — or more afraid of the backlash when constituents realize the programs getting cut are ones that help their neighbors, maybe even themselves?”

Last week the Republican- controlled U.S. House passed a stopgap spending measure to fund federal programs for the rest of the year that cuts some $61 billion from current spending levels, with the biggest cuts to social, health, education and environmental programs.

The Senate, where the Democrats retain a thin majority, is unlikely to go along, setting the stage for a possible government shutdown after the March 4 deadline for approval of the continuing resolution — although this week there were whispers of yet another temporary extension.

But with the Obama administration signaling a strong willingness to cut even programs dear to the hearts of the Democratic base, Congressional Republicans are likely to get much of what they want, most analysts say.

That signal came in the form of President Obama’s $3.73 trillion budget proposal for the next fiscal year — a proposal that includes big cuts in a popular home heating assistance program for the poor and the Community Service Block Grants program which, if the administration has its way, would be cut in half.

That’s a $350 million reduction — the cost of only two F-22 Raptor stealth fighters — but it is a critical element in community-based human service programs, according to Met Council’s Rapfogel.

“Block grant funding plays a major role for the Jewish Community Councils, and provides money for a variety of the services,” he said. “Any sizable reduction will have a huge impact on their ability to provide services economically and effectively. There’s no doubt that if these cuts are implemented, we’ll see the results.”

William Daroff, vice president for public policy of The Jewish Federations of North America, is the point person for the Jewish Federation system as the budget wars begin in earnest on Capitol Hill.

He agreed that even more modest cuts in the block grant programs will be a big problem for Jewish service providers across the country, especially those in big cities.

So will the administration’s proposed big cut in the Emergency Food and Shelter Program, created in 1983 in a partnership between the federal government and what was then the Council of Jewish Federations (CJF).

“That’s one of our signature programs, and it’s on the cutting block in the administration’s budget plan,” Daroff said.

B’nai B’rith International, a pioneering provider of senior housing, expressed concern that the administration’s proposed five-year spending freeze “could eventually jeopardize a range of aging services programs, especially as the baby boomers begin to retire, and older Americans continue to have a difficult time finding work.”

Compounding the problem Jewish agencies could face is the administration’s proposal to raise revenues through changes to the tax code — and in particular to cut itemized deductions.

According to JFNA, that would “definitively reduce tax incentives for charitable giving’” in an environment in which religious charities and other nonprofits will be called on to pick up the slack for reduced government services.

“Our institutions are extremely active in trying to address the needs of the community, but we can do so only in partnership with the government,” said Rabbi Abba Cohen, vice president for federal affairs of Agudath Israel of America. “That framework has worked; if it doesn’t stay in place, you’re going to see a whole new set of problems.”

Cutting charitable deductions “would make it harder for faith based and non-faith based charities to address these issues,” he said.

Jewish leaders who have become accustomed to perennial threats of big budget cuts say the political and fiscal environments really are different this year, leading to the prospect their most dire predictions could finally come true.

“The overwhelming message that came out of that election is that the electorate really is concerned about government spending,” said the JFNA’s Daroff. “Part of the change we’re seeing is that President Obama is trying not to be tone deaf to that message; there’s some triangulating going on as the president talks about budget cuts to show his ear is to the ground.”

While the fact the Republican-led House seems driven by the Tea Party movement to move for unprecedented cuts in human service, environmental and regulatory programs, what really worries some Jewish leaders is the fact the Obama administration, gearing up for 2012, has abandoned traditional Democratic positions on human service spending.

Met Council’s Rapfogel cited President Obama’s State of the Union promise to veto any spending bill that includes earmarks.

“Instead of standing up and saying, ‘there are good earmarks and bad earmarks,’ he just caved in to the Tea Parties and said ‘no earmarks,’ ” he said. “The reality is that earmarks are perhaps the most efficient way to help local, community-based organizations to develop basic services, from food pantries to job counseling.”

In private, several Jewish activists expressed concern that the unprecedented pressure on federal spending, while almost certain to produce drastic funding cuts this year, is still more a matter of politics than serious deficit reduction. So far, both Congressional Republicans and the Democratic administration are talking only about cuts in discretionary spending — mostly leaving the much bigger defense and entitlements budgets alone.

Without substantial cuts in a bloated Pentagon budget and serious entitlement reform, there is suspicion in some Jewish quarters that the looming cuts are still more about politics than sound budgeting.

“There are very Draconian cuts being discussed,” said Jane Ramsey, executive director of the Jewish Council on Urban Affairs, a Chicago social action group that works closely with other community organizations. “They’re putting out some pretty daunting numbers, and if they come to pass cities across the country will be very hard pressed to deal with the results. Right now it’s a game of chicken.”