Ryan Budget: Giving States Flexibility Works…But Only to Justify Shredding the Social Safety Net

House Budget Committee Chairman Paul Ryan. (Wikimedia Commons)

House Budget Committee Chairman Paul Ryan. (Wikimedia Commons)

The Ryan Budget makes enormous cuts to critical safety net programs that help low-income families access health care and put food on the table. Its author, Rep. Paul Ryan (R-WI), claims that these programs will become more efficient, by transferring control over them from the federal government to the states. This belief in the power of giving states flexibility is central to the Ryan Budget. If the states fail to dramatically improve program efficiency, then the Ryan Budget would shred the social safety net.

Given the stakes, one would expect the Ryan Budget to be deeply committed to the idea of giving states flexibility. However, the budget only supports that concept when it is being used to justify deep spending cuts. The Ryan Budget actually takes a dim view towards programs where states already have flexibility, and is especially critical of decisions by the Obama Administration to delegate more authority to  the states.

The Ryan Budget would cut Medicaid by over $1.4 trillion over the next ten years. Medicaid provides health coverage to over 50 million Americans, and the expansion of the program under Health Care Reform has the potential to cover over 21 million more. The Ryan Budget repeals this Medicaid expansion, which is a $636 billion cut, and then makes an additional cut of $810 billion.

How will Medicaid continue to function after such a drastic cut? Here’s the Ryan Budget’s explanation (p. 80):

Provide State Flexibility on Medicaid. One way to secure the Medicaid benefit is by converting the federal share of Medicaid spending into an allotment tailored to meet each state’s needs, indexed for inflation and population growth. Such a reform would end the misguided one-size-fits-all approach that has tied the hands of state governments. States would no longer be shackled by federally determined program requirements and enrollment criteria. Instead, each state would have the freedom and flexibility to tailor a Medicaid program that fit the needs of its unique population.

The Ryan Budget handles the Supplemental Nutrition Assistance Program (SNAP) in a similar manner. SNAP, also known as “food stamps,” alleviated hunger for almost 47 million Americans in 2012. The Ryan Budget endorses endorses a $125 billion cut in SNAP over the next ten years, which is larger than it sounds since the cut only starts to take effect in 2019. This cut is similarly justified as savings from giving states flexibility (p. 88).

The Community Development Block Grant was created by legislation signed into law by Republican President Gerald Ford. (Wikimedia Commons)

The Community Development Block Grant was created by legislation signed into law by Republican President Gerald Ford. (Wikimedia Commons)

The Ryan Budget proposes converting both Medicaid and SNAP into “block grants,” where states would determine the best way to spend federal funds from these programs. Given its enormous faith in block grants to sustain the social safety net with far less federal investment, one would expect the Ryan Budget to hold up existing block grants as paragons of good government.

It does not. Instead, it proposes eliminating two major federal block grants. The Ryan Budget terminates the Community Development Block Grant (p. 69), which supports affordable housing, job creation, and services for at-risk populations. It also abolishes the Social Services Block Grant (p. 78), which gives states flexibility to meet the needs of their residents through locally-delivered programs, such as substance abuse treatment, foster care, and assistance for persons with disabilities.

The Ryan Budget reserves some of its harshest criticism for President Obama’s implementation of block grants for Temporary Assistance to Needy Families (TANF), which funds state welfare programs (p. 88):

Reinstitute Welfare Work Requirements: The Obama administration, in contravention of current law, has claimed authority to waive the work requirements of the Temporary Assistance to Needy Families program. This budget rescinds any authority the Obama administration thinks it has to provide for waivers of the work requirement of the TANF program. It assumes that President Clinton and the Republican majority at the time were correct in requiring robust work requirements for the TANF program—which led to the largest sustained reduction in child poverty since the onset of the ‘‘Great Society.’’ This would save $61 million over ten years.

Putting aside the mention of Lyndon Johnson’s Great Society, which the Ryan Budget basically repeals, is the Obama Administration really eliminating TANF work requirements? Here’s Dylan Matthews:

…the Obama administration is not removing the bill’s work requirements at all. He’s changing them to allow states more flexibility. But the principle that welfare programs must require recipients to move toward employment isn’t going anywhere.

So President Obama is letting states decide the best way to structure and enforce the welfare to work requirements. One might say he is seeking to “end the misguided one-size-fits-all approach that has tied the hands of state governments,” in the same way the Ryan Budget justified its plans to cut Medicaid.

Congressional Budgets are a statement of principles. We have identified two important principles in the Ryan Budget:

  1. Investment in safety net programs should be dramatically reduced.
  2. Giving states flexibility is good.

The problem is that #2 only applies when it is being used to justify #1. When government programs already give states flexibility – with the same block grants Rep. Ryan advocates for Medicaid and SNAP – the Ryan Budget eliminates them anyway. When President Obama offers states more flexibility, he is ruining welfare reform.

So is the Ryan Budget about finding a more efficient way to provide a safety net for the American people? Or is it a carefully crafted justification for shredding that safety net?


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