U.S. Representative Sandy Levin
12th District of Michigan

(Washington D.C.) - Today, House Republicans on the Budget Committee approved a partisan Republican budget reconciliation bill that would dramatically reduce federal support for child support collection, student loans, nutrition assistance, and health care for children, the elderly, and the disabled. Republicans claimed the "Deficit Reduction Act of 2005" would help to pay for Hurricanes Katrina and Rita, but in fact the bill would hurt those most affected by the Hurricanes by slashing key funding to programs designed to help them in their recovery. Rep. Sander Levin (D-Royal Oak) blasted its approval, calling Republican priorities "upside-down."

“This bill illustrates the mismanaged and upside-down priorities of the Republican controlled Congress,” said Rep. Sander Levin. “Generating savings by reducing health care for our children, the elderly, and the disabled makes no sense at all. This bill is Robin Hood backwards; it robs our children of vital child support, increases the cost of their student loans and puts their access to health care at risk just to fund more tax cuts for the very wealthy. It simply makes no sense.” 

Under the Republican budget reconciliation plan:

• Student Loan Programs: Federal student loan program would lose $14.3 billion.  Nearly 250,000 students in Michigan receiving student loan assistance will see their loan costs increase by an average of $5,800;
• Child Support: Federal funding for child support collections would be reduced by nearly 40 percent.  Because states collect an average of $4 in owed child support for every dollar invested in collections, the Congressional Budget Office estimates that the change would decrease child support collections by $24 billion over the next decade.  Michigan families would lose $1.2 billion in needed child support;
• Health Care for Children, the Elderly, and the Disabled: Nearly $12 billion would be cut from Medicaid over five years, and $48 billion over the next ten years. In Michigan, over 50 percent of Medicaid recipients are children. The Republican plan would immediately reduce federal Medicaid funding to Michigan by $280 million by disallowing a state managed care organization tax which helps fund physical and mental health services.  Without this funding, it is likely that the state will have to cut Medicaid health services or end Medicaid eligibility for some groups;
• Food Stamps: Funding would be cut by over $800 million, cutting off nutrition assistance to 300,000 working families across the country.  Over 25,500 Michiganders would be cut off.

“We have demonstrated since 1996 that increased investment in child support collections translates directly into money for our children,” continued Rep. Levin. “Now, Republicans want to turn back the clock on years of progress we’ve made. We should be focusing on how to improve these programs, not pushing them onto the cutting room floor.”

Although the bill’s original purpose was to rein in the deficit, it will actually increase it by billions of dollars. The $54 billion in mandatory cuts contained in this bill will go to offset in part the revenues lost due to $70 billion in new taxes. Nothing will go towards deficit reduction or paying for Katrina as long as there is a total of $70 billion in new tax cuts in the budget. 

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