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Take From the Poor, Give to the Rich

Republicans plan more tax cuts for the wealthy, slashing of social programs
by Adam Price |
January 2, 2006
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San Jose, CA - Just before the holiday recess, Republicans in the House of Representatives and Senate agreed to cut social programs that serve the poor and working class, such as Medicaid (health care for low-income people), student loans for college, TANF (Temporary Assistance for Needy Families), and Medicare (health care for the elderly). At the same time Republicans in the House of Representatives passed a bill backed by President Bush to extend Bush’s tax cuts for the well to do and businesses.

Republicans claimed that the spending cuts were needed to reduce the federal government’s budget deficit, which is estimated to be about $400 billion this year. But with their proposed tax cuts cutting revenues almost twice as much as the spending cuts would save, there would actually be an increase in the budget deficit. Many right-wingers hope that larger deficits will lead to more cuts in social programs in the future.

The bill allows states to charge higher co-payments for Medicaid services and cut back on coverage. Republican Joe Barton, a congressman from Texas, said that the poor needed to pay more for their health care to, “encourage personal responsibility.” The spending cuts in Medicaid are not only unfair to the poor, but will also drive up health care costs for other working people. With businesses are cutting more and more health care benefits for workers, cuts in Medicaid will increase the number of people without any health insurance. These costs will be put on to county hospitals and lead to even higher health insurance premiums.

The proposed cuts in college financial aid, in the form of higher interest rates on student loans, will hurt working-class students. Students have had to borrow more to pay the steep increases in tuition and fees at public colleges and universities across the country. More and more students are coming out of college with thousands of dollars in debt. While big business once needed more college graduates, now they are shipping more and more and high technology and white-collar jobs to other countries, where they can pay one-sixth to one-tenth as much in wages and benefits.

Poor parents with children would face stiffer work requirement to obtain TANF benefits. This will make it harder for parents to try to go to school to get better jobs and force them to take whatever low-paying work is available. The bill also cuts funding for child support and Supplemental Security Income, which goes to disabled and elderly poor.

The tax cuts passed by Republicans in the House of Representatives would extend Bush’s tax cuts on stock dividends, capital gains and businesses - that are now set to expire in 2009 - for another two years. Bush would like to make these tax cuts permanent, since the richest 1% of the population, who own most of the country’s stocks, would reap the benefits.

While popular opposition, mobilization by middle-class interest groups such as the AARP (American Association of Retired People), and opposition by the Democrats was able to derail Bush and the Republicans plans to privatize Social Security, more needs to be done to fight the Republicans’ tax and spending cuts. Workers’ unions, oppressed nationality community organizations and student groups must mobilize their members and mass base against the Republicans war on the poor and working class.