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What Does the Budget Deal Mean for Kids?

by Deirdre Byrne, Director of Policy, Children's Health Fund

After months of wrangling and posturing, Congress passed and President Obama is expected to sign a budget bill that allows the U.S. to meet debt obligations by raising the debt ceiling.  In exchange for lifting the debt ceiling, Congressional leaders agreed to a budget deal that aims to cut at least $2.1 and up to $2.4 trillion in federal government spending over the next ten years.  The deal would accomplish these savings in a series of steps:

  1. An initial $917 billion cut over 10 years through discretionary spending caps on defense and non-defense programs. It is not yet clear how safety net programs for kids will be impacted by this first wave of cuts, but since children's programs make up 20 percent of non-defense discretionary spending in the federal budget, kids will certainly not be held harmless.
  2. A bi-partisan Joint Committee made up of 12 Members of Congress is tasked with finding an additional $1.5 trillion in cuts by November 23, 2011.  Everything is on the table for the Joint Committee in terms of cuts, including Medicaid and CHIP in addition to Social Security, Medicare, defense and non-defense discretionary spending, and tax increases. 
  3. Congress must act on the Joint Committee’s recommendations by December 23, 2011.
  4. If Congress does not act by the deadline, an automatic $1.2 trillion in across-the-board cuts will go into effect.  In good news, Social Security, Medicaid, CHIP and certain other programs benefitting vulnerable children and their families are protected from automatic cuts. Unfortunately, other programs serving children may still be subject to cuts.

While this deal may be necessary to safeguard the economy and our country’s financial standing in the world, it doesn’t go far enough to protect children and families against painful cuts to critical programs.  In addition, these cuts come at a particularly tough time, with millions unemployed and increasing numbers of children facing poverty. 

We will continue to monitor the details to further see how these initial cuts impact kids and will continue to fight to ensure this new Joint Committee holds children harmless from painful cuts. 

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