During times of economic difficulties families often make decisions between what luxuries (like movies) they should continue to spend money on, and what to dump (like McMansions). However, despite the fact that the United States is in one of the longest economic downturns since the Great Depression, the federal and state budgets are perhaps over compartmentalized such that essential services are being cut while billions are spent on unneeded luxuries.
For example, the AIDS drug assistance programs offered by states are facing cutbacks and some HIV positive patients in need of life saving medications are on waiting lists. Moral outrage aside, this is fiscally shortsighted as HIV patients who delay starting antiretroviral medications get sicker in the later stages of their disease and cost Uncle Sam more in the long run. To achieve the best results for these patients, and for the government, new HIV research indicates that each person should be started on antiretroviral therapy as soon as they become HIV positive.
And while the House of Representatives recently approved a child nutrition bill which will help children eat healthier-by increasing servings of fruits, vegetables, whole grains, and low-fat dairy products-other programs which help children at need may be cut across the country due to budget cuts. In Westchester County in New York a small program which helps neglected and abused kids may experience a scaling back of services.
And though these changes may appear to be temporary, it is likely that it may take the economy at least a decade to recover back to pre-recession levels of employment. Last month the economy added just 39,000 jobs, which is especially bleak when you consider that to keep pace with population growth at least 125,000 jobs need to be added. If the economy added about 320,000 jobs a month, then it would take 5 years for the country to return to 5% unemployment from a current level of 9.8% unemployment.
And given how many states in the union are wrestling with massive institutional debt issues, it may be many years until funding for some critical social programs return to their pre-recession level. In fact, the debt situation is so bad among several states that many will continue to have budget shortfalls well after unemployment numbers have improved. And considering that federal stimulus dollars which propped up states budgets this years will run out next year, the budget situation in several states could become more dire in 2011.
As the effects of the recession on the American public is tallied in the future, it may be concluded that some of the most vulnerable people, including young children and those with severe chronic medical conditions, will pay the biggest price.
Though the United States is ostensibly winding down a war in Iraq, and another in Afghanistan, military spending increased by 3.0% from 2009 to 2010, which meant about an extra $20 billion was pumped into the military budget. Though the percentage of the American GDP spent on the military budget is historically moderate, at about 4%, the interest on this defense spending is at all time high. While it may have been difficult during the Cold War to scrutinize military spending, recent concerns about the ongoing wars, and the decreased likelihood that the United States will “win” in Afghanistan, may reignite opposition to the wars. Certainly it is a strange situation when a country has enough money to buy high-tech ordinance and fund big budget military projects while money for state and federal safety net programs dries up.