Trump Budget and Health Care Cuts are Devastating for People with Disabilities, Including Soojung’s Family

WASHINGTON, DC – Today the Trump Administration released its first ten year budget proposal, and the numbers are devastating for people with intellectual and developmental disabilities (I/DD) and their families. On top of the more than $800 billion in Medicaid cuts already approved by the House of Representatives, the Trump Administration is planning for $610 billion in cuts to Medicaid; $72.4 billion in cuts to Social Security’s disability programs; and hundreds of billions more in cuts to other effective federal programs that are vital to people with I/DD.

“Where we invest our federal dollars is a measure of our values as a nation. Today the Trump Administration showed its cards, and coupled with the devastating Medicaid cuts already approved by the House of Representatives in the health care bill, the deck is stacked against people with disabilities.

“In the last few weeks, I’ve traveled to chapters of The Arc in Maryland, North Carolina, Wisconsin, and even Alaska. Chapters of The Arc sprang up in these communities and across the country decades ago because people with disabilities and their families were appalled by the segregation of people with disabilities in inhumane institutions, and they were determined to make progress. And we have fought for rights, closed institutions, opened up the community and classroom, and paved the way to employment. Two effective programs built on bipartisan policy over the years – Medicaid and Social Security – have been essential to this progress. Medicaid provides health care and long term supports that help make a life in the community possible for many people with disabilities, and Social Security is far too often the only thing keeping the lights on and food on the table for a person with a disability.

“That these proposed cuts come in the very same package that is proposing the largest tax cuts in our nation’s history is simply obscene. Giving $5 trillion in tax cuts that primarily benefit wealthy individuals and corporations while simultaneously threatening the lives of everyday people defies comprehension.

“This budget – this Trump card – along with the health care cards being played in Congress as we speak, will dismantle decades of progress for people with disabilities and their families. So I’m calling on all advocates to do what they have done for decades, band together to put a face on these cuts. Share your story in your community and with your elected officials, and tell them to reject these cuts, before we go back in time to an era of discrimination and isolation,” said Peter Berns, CEO, The Arc.

In tandem with this budget news, The Arc is releasing a video which shares the story of a Maryland family which risks losing access to critical care for one of their children due to impending cuts to federal Medicaid funding. The video features Soojung, whose 11-year old daughter Alice, has Rett Syndrome and relies on overnight nursing services to be able to live at home with her family. Soojung speaks about the challenges she and her husband faced accessing these services, including having their requests turned down by private insurers. After years of waiting and uncertainty, Alice was finally accepted to a Medicaid program that provides her with nightly nursing services. These services have led to a great improvement in Alice’s health, making 2016 the first year of her life without a hospital stay.

For many families like Soojung’s, their health and lives could dramatically worsen if the Trump Administration’s proposed Medicaid cuts became a reality or if the over $800 billion in cuts over 10 years to federal Medicaid funding, proposed in the House-approved American Health Care Act (AHCA), go into effect. These cuts would not only force states to cut eligibility for their Medicaid programs, but would also diminish the quality and quantity of services that are provided to people who are already enrolled in these programs.

This video is the fifth in a series of videos The Arc is releasing, sharing the personal stories of people with disabilities and their families, and the impact of the Affordable Care Act (ACA) and Medicaid on their lives.

o   Meet Bryan

o   Meet Thelma

o   Calvin’s Story

o   If I could say one thing

 

The Arc advocates for and serves people with intellectual and developmental disabilities (I/DD), including Down syndrome, autism, Fetal Alcohol Spectrum Disorders, cerebral palsy and other diagnoses. The Arc has a network of over 650 chapters across the country promoting and protecting the human rights of people with I/DD and actively supporting their full inclusion and participation in the community throughout their lifetimes and without regard to diagnosis.

The Arc@School Releases Report on Special Education Advocacy and The Arc’s Chapter Network

School may be almost out for the summer, but The Arc@School is still in session.  Now in its second year, The Arc@School continues its mission to build the capacity of The Arc’s nationwide network of chapters to provide individual advocacy that helps students with intellectual and developmental disabilities (I/DD) navigate the special education system.  Equal access to education is a fundamental right for all citizens and an important building block for a strong society.  For students with I/DD, a high-quality education can make an enormous difference in the quality of life and degree of independence they enjoy in adulthood. Special education advocacy is instrumental in ensuring that students’ rights are respected and that they receive the services and supports necessary to graduate from high school and pursue post-secondary education and employment.

With these ideals in mind, The Arc@School conducted an investigation of existing special education advocacy practices and published a report entitled Special Education Advocacy and The Arc’s Chapter Network: Findings from The Arc@School.  Students with I/DD, parents, educators, and advocates can find:

  • A brief overview of the Individuals with Disabilities Education Act (IDEA) and the growth of non-attorney lay advocacy in special education;
  • A description of the curriculum, length, and cost of current advocacy training programs, such as Wrightslaw and the Council of Parent Attorneys and Advocates (COPAA);
  • A description of The Arc networks’ current capacity for providing individual special education advocacy;
  • A summary of the current limited academic research on best practices in special education advocacy; and
  • A list of program recommendations that The Arc@School intends to implement in the coming years, such as a suggestion that The Arc@School collaborate with the COPAA, PTI Center, and protection and advocacy networks to ensure that scarce special education advocacy resources reach as many families as possible.

To read the report, please see Special Education Advocacy and The Arc’s Chapter Network.

What Do Moms Need?

Last week, The Arc was excited to join nearly 50 national organizations that co-sponsored the #MomsDontNeed / #LasMamásNoNecesitan Tweet storm. On Twitter, we called attention to recent actions and policies that threaten mothers and families, and highlighted the kind of supports they and all people truly need to protect and advance their economic security, health, and more.

Moms with disabilities, and moms of children with disabilities, do so much. And across the nation, moms are working harder than ever. With Congress considering legislation to devastate our health care system, and with new reports of major cuts in the works to Medicaid, Social Security disability benefits, and other effective federal programs, so much is at stake – for moms, and for all of us. As The Arc celebrates Mother’s Day, here are three things that we know are vital to supporting mothers and their many contributions.

1. Access to Health Care and Long-Term Supports and Services. Health insurance under the Affordable Care Act can make all the difference in the world. Just listen to Lindsay, mother of toddler Calvin, if you’re not sure why. In addition, for many people with intellectual and developmental disabilities, Medicaid provides a range of essential medical and long-term supports and services that make community living a reality and for many, can be the difference between life and death. Unfortunately, the American Health Care Act (AHCA) – passed recently by the House of Representatives and now before the Senate – shows callous and dangerous disregard for the wellbeing of people with disabilities and their families. Among the bill’s many harmful provisions, the AHCA would decimate Medicaid, erase health insurance cost protections for people with pre-existing conditions, and cause people to lose essential health benefits under state waivers. The AHCA is one bill that #MomsDontNeed.

2. Economic Security. For most moms and families of children and adults with intellectual and developmental disabilities, every penny counts. For example, raising a child with disabilities can be tremendously expensive due to major out of pocket medical and related costs, like adaptive equipment and therapies. For many families, earnings from work aren’t enough to maintain a basic standard of living and cover these often-extraordinary disability-related costs. It’s only possible because of income from Social Security’s disability programs, including Supplemental Security Income (SSI). Unfortunately, recent news reports suggest that President Trump’s 2018 budget will propose major cuts to Social Security disability benefits, as well as Medicaid and a host of other programs – totaling $800 billion in cuts. That’s another devastating idea that #MomsDontNeed.

3. Paid Family and Medical Leave. Moms with disabilities, and moms of children with disabilities, know better than most that time is a precious resource. At The Arc, we hear often from moms and dads struggling to get enough paid time off work: to be with a new baby in the Neonatal Intensive Care Unit; to care for a new baby with disabilities when they first come home; to take their son or daughter to medical appointments, therapies, and after school programs; to attend IEP meetings and other school appointments – and so much more. And while we all love Wonder Woman, let’s face it, moms get sick, too. Moms shouldn’t have to choose between a pay check and a child’s health, or a pay check and their own health. Not moms, not anyone. That’s why The Arc is joining the call for a robust federal paid family and medical leave program. We hope you’ll #JoinOurFight!

The Arc Promotes Workforce Development for Egyptians with Disabilities through U.S. Department of State Exchange Program


[WASHINGTON, DC] The Arc will host Michael Mikhael, Executive Director and founding member at the Farah Foundation for Development in Alexandria, Egypt as a fellow in the U.S. Department of State’s Professional Fellows Program (PFP). This two-way exchange embraces the power of individual citizens to find creative solutions to challenges they face in both the United States and around the world. During the month-long fellowship program, mid-level foreign leaders and their U.S. counterparts build sustainable partnerships while enhancing their leadership and professional skills.

While in Washington, D.C., Michael will be exposed to innovative strategies of workforce development for people with disabilities. He will also have the opportunity to gain hands-on exposure to the different advocacy efforts that nonprofit organizations utilize in the struggle for disability rights. This parallels the PFP’s objective of broadening the professional expertise of individuals from around the world working to address common challenges, all while building enduring partnerships among American and foreign participants.

Michael comes to the U.S. with a strong background of supporting persons with disabilities. As early as 1993, he saw the need for economic empowerment programs that catered to individuals with disabilities while engaged in a church-led disability program, Faith and Light. Subsequently, in 2010, he established the Farah Foundation that has developed partnerships with the United Nations’ International Labor Organization (ILO) and the U.N. Development Programme (UNDP) to implement a labor market access and entrepreneurship program for people with disabilities. The foundation also created a database where individuals may seek disability-friendly employment. Additionally, the agency developed an artisan-craft program through which women and people with disabilities are taught marketable craft skills. In addition to these workforce activities, the Farah Foundation supports an orphanage for children with disabilities in Alexandria, Egypt. Upon returning home, Michael believes this new knowledge will help his organization incorporate more sustainable, comprehensive programs for people with disabilities in Egypt.

“The Professional Fellows Program (PFP) is an extraordinary opportunity, and The Arc is thrilled to participate. During Michael’s month-long fellowship, not only will he gain invaluable advocacy and technical skills he can use when he returns to the Farah Foundation, but The Arc will simultaneously also deepen its cultural competency knowledge and understanding. It’s a win for both of us,” commented Jonathan Lucus, Managing Director, The Arc@Work.

The Arc is one of hundreds of U.S. organizations chosen to host Professional Fellows participants from more than 40 countries and territories this spring. At the conclusion of the program, May 30-June 1, more than 270 fellows will gather in Washington, D.C., for the Professional Fellows Congress, a three-day concluding event aimed at preparing fellows to implement follow-on projects upon their return home.

Since 2010, more than 2,000 participants from more than 77 countries have taken part in the PFP in cities across the U.S., and approximately 1,000 American hosts have participated in reciprocal exchanges overseas.

The Arc advocates for and serves people with intellectual and developmental disabilities (I/DD), including Down syndrome, autism, Fetal Alcohol Spectrum Disorders, cerebral palsy and other diagnoses. The Arc has a network of over 650 chapters across the country promoting and protecting the human rights of people with I/DD and actively supporting their full inclusion and participation in the community throughout their lifetimes and without regard to diagnosis.

Follow @ProFellows on Twitter and join the conversation using #ProFellows.

For press inquiries please contact:

Kristen McKiernan, Senior Executive Officer, Communications (mckiernan@thearc.org)

U.S. Department of State, Bureau of Educational and Cultural Affairs: eca-press@state.gov

The Passage of the AHCA: The Real Life Consequences for People with Disabilities

By: Julie Ward, Director of Health Policy and Nicole Jorwic, Director of Rights Policy

They say that if you want to know about a person, look at how they spend their money; to know the values of a nation, the same is true. The current Affordable Care Act and Medicaid fight is showing a side of the political system that is disheartening and shameful. The American Health Care Act, passed by the U. S. House of Representatives, lowers taxes on wealthy individuals and corporations and pays for it by taking over $800 billion from the Medicaid program which serves low income children, seniors, people with disabilities, parents, and other adults.

The fundamental injustice of transferring wealth from low income people to businesses and wealthy people is compounded by the fact that these deep cuts in Medicaid will not make private health insurance more affordable or available, the stated goals of supporters of the AHCA. Instead the AHCA dismantles the main source of funding for long term supports and services (LTSS) for seniors and people with disabilities. The demand for these services, such as help to stay in a person’s own home, will grow as the population ages. Instead of addressing the need for an LTSS policy in a positive way, it makes devastating cuts and places a per capita cap on the Medicaid program.

An estimated 24 million people will lose their insurance coverage and millions are at risk of losing the supports and services that help them live in the community. Every one of those numbers represents a person. A person who will no longer be able to feel the peace of mind of health coverage, a person who now will worry that their guarantee to services under Medicaid is irreparably changed, a person whose supports to assist them to work are at risk, and a person who now has to fear that their son or daughter will end up in an institution, when they have fought their whole lives to keep him/her in the community.

Medicaid is the main source of funding for over 77% of the supports and services that individuals with intellectual and/or developmental disabilities (I/DD) use to live in the community and has been able to grow because of the widespread bipartisan support. They have had bipartisan support because disability knows no political, or geographical, ethnic, or socioeconomic boundaries. These supports and services provide dignity to people with I/DD by providing help with meals, bathing and dressing, toileting, in-home skilled nursing, and communication support, to name but a few. These supports are critical to people with disabilities to be able to live their lives in the community. In many cases, they can be the difference between life and death.

We fear that because home and community based services are not mandatory services, they will be cut first. States will return to outdated modes of serving people with disabilities, congregating large numbers of individuals in facilities with inadequate staffing and no real-life opportunities. The per capita cap proposal will pave a path backwards to institutional care and segregated services.

The AHCA has many other troubling provisions and The Arc has developed a summary of how the bill impacts people with disabilities.

As the Senate develops its health care reform proposals, we must be constant reminders that the services and supports to people with disabilities and their families CANNOT be what pays for health care reform and tax cuts. Lives depend on it.

“Don’t Take Away Our Independence”: Watch Thelma as The Arc Denounces Massive Cut to Medicaid

WASHINGTON, DC – Today, The Arc released a video which highlights how the House-passed cut to Medicaid funding (which exceeds $800 billion) will negatively impact people with disabilities’ capacity to live independently. The video features a conversation with Thelma, a long-time Washington, DC resident who relies on Medicaid to employ a health aid who helps her perform daily household tasks that she can no longer perform by herself. She, like many others in the disability community, fears that reduced federal funding for Medicaid will limit her ability to hire attendants or access other services she needs to live independently, in the community in which she has lived since her youth.

The video comes on the heels of the House of Representatives passing the American Health Care Act, which included over $800 billion in cuts over 10 years to federal funding for Medicaid programs. This cut would not only force states to cut eligibility for state Medicaid programs, but will also diminish the quality and quantity of services that are provided to people who are already enrolled in these programs. For many people with intellectual and developmental disabilities, Medicaid generally is the only source of funds for them to live and work in the community with friends and families and avoid costly, harmful, and segregated institutions.

“Thelma is part of her community because of Medicaid. And her community is Washington, DC, right in the backyard of where Congress is considering dismantling the program that provides services and supports to Thelma and millions of other people across the country. Every member of the U.S. Senate needs to hear Thelma’s plea, and listen to the thousands of people they represent who have a disability, or have a family member with a disability, or provide services. This is about peoples’ lives – nearly a trillion dollars in cuts will drastically impact the ability of people with disabilities to be a part of their communities. It is unacceptable and The Arc and our network won’t stand for it,” said Marty Ford, Senior Executive Officer, The Arc.

This video is the third in a series of videos The Arc will be releasing in the coming weeks, sharing the personal stories of people with disabilities and their families, and the impact of the Affordable Care Act (ACA) and Medicaid on their lives. The first video featured nine people who rely on the ACA and/or Medicaid, and each one has a personal message for Members of Congress and the Trump Administration. The second video illustrates how Congress’ proposed changes to the ACA and Medicaid would negatively impact Americans with disabilities and their families. The video features an interview with Toby, Lindsay, and Calvin from Fairfax, VA. Calvin has Bilateral Fronto-Parietal Polymicrogyria and Cerebral Palsy and relies on multiple insurance plans to cover his medical and therapeutic treatments.

The Arc advocates for and serves people with intellectual and developmental disabilities (I/DD), including Down syndrome, autism, Fetal Alcohol Spectrum Disorders, cerebral palsy and other diagnoses. The Arc has a network of over 650 chapters across the country promoting and protecting the human rights of people with I/DD and actively supporting their full inclusion and participation in the community throughout their lifetimes and without regard to diagnosis.

The Arc Responds to House Passage of The American Health Care Act: “Shows callous and dangerous disregard for the wellbeing of people with disabilities”

Washington, DC – The Arc released the following statement following the House of Representatives passage of the American Health Care Act (AHCA), with the addition of amendments that take the bill from bad to worse for people with intellectual and developmental disabilities (I/DD) and their families:

“Members of the House of Representatives who supported the American Health Care Act voted against their constituents with intellectual and developmental disabilities. We won’t soon forget those who so willingly ignored the pleas of their constituents who rely on the Affordable Care Act and Medicaid for comprehensive health care coverage and long term services and supports that enable them to live full lives in the community. We must call this what it is – an attack on the rights and lives of people with disabilities.

“The federal government will be walking away from a more than 50 year partnership with states when it comes to Medicaid. Deep cuts and radical restructuring will decimate the Medicaid program. With an over $800 billion cut to Medicaid, states will face difficult choices about what people to cut from the program or what services to roll back. Optional services like home and community based services are likely to be cut. Lives will be lost when people are unable to access the health care and community supports they need.

“The plan that passed the House today is insufficient to keep people with disabilities insured or to support anyone with complex medical needs. If signed into law as currently written, this bill will result in people with disabilities and their family members losing health coverage in the private insurance market and in Medicaid. Coverage also becomes unaffordable as people with pre-existing conditions lose protections against higher premiums.   Those lucky enough to retain their coverage will find that some of the services they need – Essential Health Benefits – are no longer available.  And Medicaid funded long term supports and services, which help people live independently and be included in their communities, will be even scarcer as waiting lists for services will grow all across the country.  Some may end up living in nursing homes and institutions because community services are no longer available.

“The American Health Care Act shows callous and dangerous disregard for the wellbeing of people with disabilities and their families and erases decades of progress.  Now we turn to the Senate, our last line of defense. We intend to work with Senators on both sides of the aisle to oppose this harmful legislation. We continue to encourage disability advocates across the country to reach out to their Senators to voice their concern about this bill,” said Peter Berns, CEO, The Arc.

This week, The Arc released another video illustrating how Congress’ proposed changes to the ACA and Medicaid would negatively impact Americans with disabilities and their families. The video features an interview with Toby, Lindsay, and Calvin from Fairfax, VA. Calvin has Bilateral Fronto-Parietal Polymicrogyria and Cerebral Palsy and relies on multiple insurance plans to cover his medical and therapeutic treatments.

This video is the second in a series of videos The Arc will be releasing in the coming weeks, sharing the personal stories of people with disabilities and their families, and the impact of the ACA and Medicaid on their lives. The first video featured nine people who rely on the ACA and/or Medicaid, and each one has a personal message for Members of Congress and the Trump Administration.

A New Series Starts Off by Getting Disability Wrong

Over the years, we’ve seen flawed, misleading reporting on Social Security’s disability programs from National Public Radio, 60 Minutes, and the New York Times. Unfortunately, with the recent launch of a new, widely-criticized series, “Disabled America,” The Washington Post has joined the ranks of news media leaving the public with false impressions about Social Security disability benefits — and even, getting the facts plain wrong.

The Post’s new series will focus on how disability “…is shaping the culture, economy and politics…” of rural communities. The first article featured Desmond Spencer of Beaverton, Alabama as he made the difficult decision to call the Social Security Administration to ask about applying for disability benefits. The article relates that Mr. Spencer acquired painful, ongoing injuries during many years working as a roofer, welder, ranch hand, and garbage collector – including falling off a roof and being unable to get treatment due to his lack of health insurance. Readers do not learn whether Mr. Spencer ever applies for benefits, and do not know if he will qualify.

The Center for American Progress (CAP) summed up the first article’s many flaws:

“…the article cherry-picks one of the counties with the highest rates of disability benefit receipt, to create a dystopian portrait where Social Security disability benefits represent out-of-control government spending riddled with rampant abuse.

Reality looks quite a bit different.”

After digging in, CAP researchers revealed that the Post’s numbers are “flat-out wrong,” including its assertion that up to one-third of working-age adults in many rural counties receive disability benefits. CAP explained in detail the errors in the Post’s analysis and why that conclusion simply cannot be substantiated. The Post issued a correction – and CAP and others quickly pointed out ongoing major problems with the Post’s data, even after the correction.

Thirty-one national disability organizations subsequently called on the Post to correct and clarify the skewed and misleading numbers that remain in the article. Numerous groups have called out a host of additional problems with the story and data. And the Huffington Post and Des Moines Gazette have reported on the article’s flaws.

With the President’s budget director signaling that cuts to Social Security disability benefits may be under consideration, it’s vital that reporters get the facts right. Here’s a round-up of analyses and responses.

The Arc Video Offers Disability & Family Perspective on Looming Healthcare Reforms

Washington, DC – Today, The Arc is releasing another video illustrating how Congress’ proposed changes to the Affordable Care Act (ACA) and Medicaid would negatively impact Americans with disabilities and their families. The video features an interview with Toby, Lindsay, and Calvin from Fairfax, VA. Calvin has Bilateral Fronto-Parietal Polymicrogyria and Cerebral Palsy and relies on multiple insurance plans to cover his medical and therapeutic treatments.

This family’s story is shared by thousands of families across the country who are imploring Congress to keep the ACA and leave Medicaid untouched to allow their loved ones to continue to receive the supports they need to live full and independent lives. Here are some of the key ways in which the passage of the American Health Care Act (AHCA) will impact Toby, Lindsay and Calvin, and others in the intellectual and developmental disability community:

  • Proposes a more than $800 billion cut to Medicaid over the next decade, the program which provides funding for essential services for people with intellectual and developmental disabilities to live independent and healthy lives;
  • Allows for insurance companies to discriminate against people with disabilities by using pre-existing conditions as a pretext for higher and often unaffordable health care premiums;
  • Places more pressure on states to support an already under-funded program, which will result in smaller budgets, less coverage and fewer services for people with intellectual and developmental disabilities.

“The Arc opposes the AHCA and the proposed changes to the bill, as both will have widespread and terrible consequences for people with intellectual and developmental disabilities and their families. Congress needs to realize that a vote for the proposed health care reform is a vote against the health and wellbeing of their constituents, which include people with disabilities,” said Marty Ford, Senior Executive Officer, The Arc.

This video is the second in a series of videos The Arc will be releasing in the coming weeks, sharing the personal stories of people with disabilities and their families, and the impact of the ACA and Medicaid on their lives. The first video featured nine people who rely on the ACA and/or Medicaid, and each one has a personal message for Members of Congress and the Trump Administration.

The Arc advocates for and serves people with intellectual and developmental disabilities (I/DD), including Down syndrome, autism, Fetal Alcohol Spectrum Disorders, cerebral palsy and other diagnoses. The Arc has a network of over 650 chapters across the country promoting and protecting the human rights of people with I/DD and actively supporting their full inclusion and participation in the community throughout their lifetimes and without regard to diagnosis.

Can People with Disabilities Afford this Tax Cut?

By Annie Acosta, Director of Fiscal and Family Support Policy

May 1, 2017 – Washington, D.C. President Donald Trump released an outline of his tax reform proposal on April 26. In what he calls “the biggest individual and business tax cut in American History,” the President offers a plan than would disproportionately benefit the wealthiest of citizens and substantially add to federal deficits and the debt. Low income Americans, including the disproportionate number with disabilities, would eventually be faced with even greater cuts to critical federal programs to make up for the resulting budget shortfall.

President Trump’s 2017 Tax Reform for Economic Growth and American Jobs

“The Biggest Individual and Business Tax Cut in American History”

Goals for Tax Reform

  • Grow the economy and create millions of jobs
  • Simplify our burdensome tax code
  • Provide tax relief to American families—especially middle-income families
  • Lower the business tax rate from one of the highest in the world to one of the lowest

Individual Reform

  • Tax relief for American families, especially middle-income families:
    1. Reducing the 7 tax brackets to 3 tax brackets for 10%, 25% and 35%
    2. Doubling the standard deduction
    3. Providing tax relief for families with child and dependent care expenses
  • Simplification:
    1. Eliminate targeted tax breaks that mainly benefit the wealthiest taxpayers.
    2. Protect the home ownership and charitable gift tax deductions.
    3. Repeal the Alternative Minimum Tax.
    4. Repeal the death tax.
  • Repeal the 3.8% Obamacare tax that hits small businesses and investment income.

Business Reform

  • 15% business tax rate
  • Territorial tax system to level the playing field for American companies
  • One-time tax on trillions of dollars held overseas
  • Eliminate tax breaks for special interests

Process:
Throughout the month of May, the Trump administration will hold listening sessions with stakeholders to receive their input and will continue working with the House and Senate to develop the details of a plan that provides massive tax relief, creates jobs, and makes America more competitive – and can pass both chambers.

To understand the impact of this tax plan on people with intellectual and developmental disabilities (I/DD) and their families, it is also necessary to look at some of the basic facts about current tax policy. As the leading charitable organization advocating on behalf of people with intellectual and developmental disabilities, The Arc seeks to ensure that federal funding for programs that help our constituents to live meaningful lives in the community is preserved.

Essential federal programs like Medicaid, Social Security, Supplemental Security Income, and the many discretionary programs – like education, housing, and employment – are all funded through tax dollars, whether through individual, corporate, payroll, excise, estate, or other taxes. As stated by former Supreme Court Justice Oliver Wendell Holmes, Jr., “taxes are the price we pay for a civilized society.”

In addressing the impact of the plan, it is necessary to look at the assumptions in the plan’s goals, along with some of the details of the proposed changes:

  • Grow the economy and create millions of jobs is a basic goal and assumption of this plan. However, the argument that tax cuts will be made up for by increased economic activity has long been discredited by leading economists. At most, a small percentage can be recouped. Read more on this from the Committee for a Responsible Federal Budget.
  • Simplify our burdensome tax code. Reducing the current 7 tax brackets to 3 tax brackets (for 10%, 25% and 35%) does little to make taxes any easier to complete. It would simply lower the amount of revenue generated.
  • Provide tax relief to American families—especially middle-income families. The implication that America is a high tax country is only true if the United States is compared to all nations, including the majority that are developing. When compared to other developed nations, the U.S. tax burden is below average. Learn more on comparative income taxes from the Pew Charitable Trusts.
    On average, Americans pay an effective income tax rate of 9.5 percent, according to research by the Tax Policy Center. As shown below, however, the federal tax system is progressive with middle income Americans paying a much lower rate. Those with incomes between $30,000 and $50,000 pay almost no federal taxes, and consequently, would stand to gain very little with the Trump tax cut plan.
  • Lower the business tax rate from one of the highest in the world to one of the lowest. While the top statutory corporate tax rate of 35% in the U.S. (shown right) is, in fact, among the highest, the effective tax rate is much lower. The average effective tax rate – the actual rate paid after deductions and credits – is slightly lower than other developed countries (27.1% versus 27.7%). See Congressional Research Service (CRS) report for more information.

Further, it is important to note that corporate tax contributions have been steadily declining for decades. As shown below, the corporate share of federal tax revenue now only accounts for 11% of federal revenue, down by two-thirds in 60 years.

One of the reasons for this drop is changes in how corporations are operating and being taxed. An increasing number of corporations’ profits are subject to no taxation (foreign profits that stay abroad) or different taxes (income tax in the case of S corporations). S corporations are structured as “pass through” entities. They do not pay the corporate income tax, but rather pass profits through to owners who pay tax under the individual income tax at a lower rate. Over 90% of U.S. businesses do not pay the corporate tax rate.

 

 

President Trump’s plan to allow S corporations to pay the proposed top business rate of 15% instead of the rate they pay under their current individual tax rate (see brackets below) would disproportionately benefit the very wealthy while draining public revenues. Currently, only individual income below $37,950 a year is taxed at 15 percent or less. Under the Trump plan, anyone who makes their income via a pass-through entity would pay the 15% rate no matter how much they made. President Trump owns over 500 such business entities, according to the Trump Organization’s tax counsel.

Not explained in the President’s plan is that it will increase deficits by an additional $3 to 7 trillion over 10 years, according to the nonpartisan Committee for a Responsible Federal Budget . The proposed 60% cut in the corporate tax rate alone would lose $2.4 trillion over 10 years. Such massive cuts to revenues could have substantial impact on all human services funding, including services and supports for people with I/DD.

House and Senate leadership have consistently required that legislation be “paid for” in order to move through the legislative process and the President’s plan does not include viable pay-fors, therefore creating a major conflict if there is any interest in moving it forward. The Arc will remain vigilant in monitoring the impact of the plan if it begins to move legislatively.

For additional resources on federal taxes and the President’s plan see: