Today, the Northwest Area Foundation released the findings from a national survey of 4,000 adults called "Struggling to Make Ends Meet." The findings are easily accessed using an interactive tool. Findings from Washington State include:
- 31% of respondents reported that they or a family member lost a job in the last 12 months.
- 35% had their hours (or those of a family member) cut at work in the last 12 months.
- 61% report cutting back on spending as a result of the recession.
Other topics include awareness of available services, ability to pay for basic needs, the scope of and explanations for hardship in local communities, and views about elected officials.
Today’s new revenue forecast from the Economic and Revenue Forecast Council widens the current state fiscal gap by $238 million.
The balance sheet included in the forecast shows the general fund deficit for the current biennium to be $430 million with a balance of $245 million in the rainy day fund. Those numbers do not include an adjustment for the most recent caseload forecast. Including the caseload forecast would increase the deficit by about $250 million.
While the sizable current deficit is a matter of concern, of greater concern are:
- The 2011-13 biennium, which could face a deficit reaching into the billions of dollars when federal recovery funds being used to support education, health care, and public safety are no longer available.
- The potential passage of I-1033, which could cost the state nearly $6 billion by 2015.
The $238 million in decreased revenue expectations breaks down as follows:
- $109.6 million is due to a weaker forecast for consumer spending.
- $46.1 million is due to a State Supreme Court case which will lower B&O collections.
- $82 million is due to lower-than expected revenue collections since the last forecast.
Thousands of low income families in Washington could face painful reductions in housing assistance if Congress fails to approve additional funding for a critical federal voucher program. The Housing Choice Voucher Program provides rental support for about two million low income families throughout the United States. The program, however, faces a large budget shortfall for the remainder of 2009. Left unfilled, this shortfall could force hundreds of state and local housing agencies, serving 500,000 families, to curtail or eliminate rental assistance administered through the voucher program. Here in Washington, as many as 11,550 families could see reductions in housing vouchers.
According to a new analysis from the Center on Budget and Policy Priorities (CBPP), the shortfall in the voucher program immediately threatens rental assistance in about 400 state and local housing agencies. Cumulatively, these agencies will need an additional $130 million in funding for vouchers in 2009 to avoid drastic cuts in rental assistance and to restore assistance where cuts have already been made.
As of May 2009, shortfalls among housing agencies in Washington totaled nearly $1.6 million, leaving vouchers for 404 families completely unfunded.
The CBPP report goes on to show that states will have few good options should congress fail to approve additional funds for the voucher program. These options include:
- Denying vouchers to eligible families on waiting lists, even when slots become available;
- raising rents on voucher families;
- reducing rents paid to property owners; and
- terminating vouchers for participating families.
The top one percent of wealthiest households in the U.S. saw almost unprecedented income growth between 2002 and 2007, with income rising ten times faster than it did for the bottom 90 percent of households. As a group, the richest one percent of households saw their incomes grow by 62 percent during this period, after adjusting for inflation. By comparison, the bottom 90 percent of Americans (those with annual incomes below $110,000) experienced income growth of only four percent.
According to a new analysis of IRS data by economists Thomas Piketty and Emmanuel Saez (summarized by CBPP), income growth skewed in favor of the wealthy during the 1920’s, but then turned towards the middle class during the post-WWII era. As the graph below shows, in the early 1980’s income growth again began to concentrate in the upper tiers of American households.
Income gains have been even more pronounced among those at the very top of the income scale. The CBPP report shows that incomes in the top one-tenth of one percent of U.S. households grew by about 94 percent ($3.5 million per household) from 2002 to 2007.
The report does not show the impact of the current economic recession. Even though it is expected that income concentration will fall in 2008-09, once the recovery begins economists predict income inequality trends will continue.
New Census data shows that while the overall share of Washingtonians who lacked health insurance went down between 2000-01 and 2007-08, employer-provided coverage weakened significantly over that time. Public coverage, that is Medicaid, increased during that time, offsetting the decreases in employer-based insurance.
National data shows that in 2000-01, 13.1 percent of Washingtonians lacked health insurance. This number dropped to 11.8 percent by 2007-08. Over that time, the table below shows that employer-sponsored health insurance fell from 67 percent of the population in 2000-01 to 64.6 percent in 2007-08. At the same time, the share of the population covered by Medicaid jumped from 12.1 percent to 13.6 percent.
Before the Census data was released, the Budget & Policy Center, Washington Kids Count, and others expected there would be a decrease in the share of Washingtonians with health insurance between 2000-01 and 2007-08. The news that the share of the population with health insurance actually went up, highlights the importance of publicly provided health care coverage.
During the last legislative session in Washington, lawmakers decided to cut funding for the state’s Basic Health Plan. This will result in a loss of coverage for Washingtonians who do not receive insurance through their employer. At the same time, the unemployment rate in the state has been rising, which means many people who did have employer-sponsored insurance will no longer have coverage. Because of these trends, we anticipate that a drop in the share of Washingtonians with health insurance will become evident in the near future.
Editor’s note: On September 22, 2009 the Census Bureau will release state-by-state estimates of poverty, median income, and health insurance coverage for 2008 from the American Community Survey (ACS). The ACS has a very large sample size, allowing for single-year estimates at the state and county levels. On the 22nd, the Budget & Policy Center and Washington Kids Count will jointly release an analysis of poverty, median income, and health coverage in Washington using the latest ACS data.
The Children's Alliance along with Washington Kids Count posted an analysis of the latest census data looking specifically health coverage among children in Washington. Consistent with the general population, they find that Washington's S-CHIP program (Apple Health for Kids) has kept number of children without health insurance from climbing in 2007-08.
New Census Health Insurance Data Likely to Show Declines in Health Coverage throughout Washington State
Tomorrow, the U.S. Census Bureau will release national and state health insurance data for 2007-2008. The data will provide a preliminary glimpse of the impact that the current recession has had on families in Washington and throughout the nation. The data will not however, capture the full impact of the current economic crisis which deepened dramatically in 2009.
The new Census data is expected to show significant increases in the share of the population that is uninsured since the early 2000’s to 2007-2008. The loss of employer-sponsored health insurance is likely to be the dominant driver behind this trend. During the current recession, the economy sunk rapidly in 2009 and many more people lost their jobs and their health insurance. So while tomorrow’s release will signal trouble, next year’s 2008-2009 health coverage data will undoubtedly be far worse.
For example, as the graph below shows here in Washington the unemployment rate jumped from an average of 5.3 percent in 2008 to 9.1 percent by July 2009. Since the start of 2009, over 64,000 jobs have been lost in the state. As a result, next year’s 2008-2009 data will show a large drop in the number of Washingtonians enrolled in employer-sponsored health coverage.
Stay tuned to schmudget tomorrow when the Budget & Policy Center in conjunction with Washington Kids Count will post an analysis of health coverage trends in Washington using the new Census data. Our analysis will highlight changes in the share of the population without health insurance over time and will detail changes in employer-sponsored coverage and public coverage in Washington State.
Editor’s note: Tomorrow’s release will also include updated data on poverty and median income. To obtain state-level estimates of these measures, however, the Census Bureau recommends using data from a different survey, the American Community Survey (ACS). The latest ACS data for 2008 will be released on September 22, 2009. That morning, the Budget & Policy Center and Washington Kids Count will post analysis of the ACS data on poverty, median income, and health coverage in Washington State.
Supporters of initiatives like I-1033 argue that rigid public spending limits can be a boon for state economies. In Colorado, however, TABOR had no positive impact on the state’s economy. In fact, after enacting TABOR, employment growth in Colorado slowed relative to other states in the region. Worse, following the last recession employment recovered much more slowly in Colorado compared to neighboring states.
The table below shows that employment in Colorado grew at an annual rate of only 0.2 percent between 2001 and 2006. At the same time, the median annual growth rate among the remaining seven states in the mountain region was 9.3 percent.
For more information on how TABOR adversely impacted core public services in Colorado, see our recent report, Toxic Twins: I-1033 Mirrors Colorado’s Corrosive TABOR, coauthored with the Colorado Fiscal Policy Institute.
Editor's note: This is the final post in series about TABOR's adverse effects on essential public services in Colorado. Previous posts in the series detail the sharp declines in education funding, health care services, and transportation infrastructure that ocurred in Colorado under TABOR.