Record number in government anti-poverty programs

USA Today (Link) - Richard Wolf (August 30, 2010)

Government anti-poverty programs that have grown to meet the needs of recession victims now serve a record one in six Americans and are continuing to expand.

More than 50 million Americans are on Medicaid, the federal-state program aimed principally at the poor, a survey of state data by USA TODAY shows. That�s up at least 17% since the recession began in December 2007.

�Virtually every Medicaid director in the country would say that their current enrollment is the highest on record,� says Vernon Smith of Health Management Associates, which surveys states for Kaiser Family Foundation.

The program has grown even before the new health care law adds about 16 million people, beginning in 2014. That has strained doctors. �Private physicians are already indicating that they�re at their limit,� says Dan Hawkins of the National Association of Community Health Centers.

More than 40 million people get food stamps, an increase of nearly 50% during the economic downturn, according to government data through May. The program has grown steadily for three years.

Caseloads have risen as more people become eligible. The economic stimulus law signed by President Obama last year also boosted benefits.

�This program has proven to be incredibly responsive and effective,� says Ellin Vollinger of the Food Research and Action Center.

Close to 10 million receive unemployment insurance, nearly four times the number from 2007. Benefits have been extended by Congress eight times beyond the basic 26-week program, enabling the long-term unemployed to get up to 99 weeks of benefits. Caseloads peaked at nearly 12 million in January � �the highest numbers on record,� says Christine Riordan of the National Employment Law Project, which advocates for low-wage workers.

More than 4.4 million people are on welfare, an 18% increase during the recession. The program has grown slower than others, causing Brookings Institution expert Ron Haskins to question its effectiveness in the recession.

As caseloads for all the programs have soared, so have costs. The federal price tag for Medicaid has jumped 36% in two years, to $273 billion. Jobless benefits have soared from $43 billion to $160 billion. The food stamps program has risen 80%, to $70 billion. Welfare is up 24%, to $22 billion. Taken together, they cost more than Medicare.

The steady climb in safety-net program caseloads and costs has come as a result of two factors: The recession has boosted the number who qualify under existing rules. And the White House, Congress and states have expanded eligibility and benefits.

Conservatives fear expanded safety-net programs won�t contract after the economy recovers. �They�re much harder to unwind in the long term,� says Michael Tanner of the Cato Institute, a libertarian think tank.

Other anti-poverty experts say the record caseloads are a necessary response to economic hardship. �We should be there to support people when the economy can�t,� says LaDonna Pavetti of the Center on Budget and Policy Priorities, a liberal-leaning think tank.