Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Left is livid over budget safety net cuts

By Charles Riley, staff reporter


NEW YORK (CNNMoney) -- It doesn't come as a shock that Republicans aren't thrilled with President Obama's budget proposal. But Democrats aren't exactly jumping for joy either.

Obama's budget targets community block grants, a program that helps low-income people pay their energy bills, and the popular Pell grant program to aid college students. All are part of the social safety net Democrats often fight to protect.

And that has the left howling.

The Progressive Change Campaign Committee, a liberal organization that boasts 700,000 members, took Obama to task before the budget was even officially released.

"Proposing even more tax breaks for Wall Street banks while slashing and burning necessary government programs is right-wing radicalism, and no Democratic president should be part of it," the group said in a statement.

Obama -- who worked for years as a community organizer -- acknowledged that some of the programs facing cuts are personally important to him.

"This budget freeze will require some tough choices," the president said Monday. "It will mean cutting things that I care deeply about."

Obama went on to lament the loss in funding for community action programs in low-income neighborhoods and community development block grants.

Asked about the issue during a press conference on Tuesday, the president said he understands the frustration some feel over cuts to safety net programs.

"There are always more people who could use some help across the country," he said. "It's still a tough decision."

In a move that is sure to anger Democrats from cold-weather states, the administration proposed cutting $2.5 billion from a program that helps low-income people pay their energy bills during periods of extreme weather.

The administration argues that it is merely reducing funding to 2008 levels to account for lower energy prices. But the American Gas Association, an industry group that represents natural gas companies, predicts 3.2 million households, and 9 million individuals, would be affected by the cut.

Obama is also asking Congress to scale back a community service grant program and cut a community development program that funds projects such as housing, sewers and streets and economic development. The two reductions will save around $650 million.

Some parts of a popular education grant program are on the chopping block. The budget proposed eliminating Pell grants for summer school, and making interest on federal loans for graduate students build up during school; currently, the interest tab doesn't start running until after graduation.

The administration said that those cuts would help preserve the maximum Pell grant of $5,500.

Of course, all of Obama's proposed cuts will have to make it through an arduous budget process before becoming law. For some Democrats, that offers little solace.

"The budget proposal from President Obama is right from the Republican plan," Rep. Jesse Jackson, Jr., a Democrat from Obama's home state of Illinois said in a statement. "As the president, he should be the last line of defense for the most vulnerable Americans, instead of the first one to cut." To top of page

Index Last Change % Change
Dow 17,651.26 -99.65 -0.56%
Nasdaq 4,725.64 -37.59 -0.79%
S&P 500 2,051.12 -12.25 -0.59%
Treasuries 1.78 -0.02 -0.89%
Data as of 4:48am ET
Company Price Change % Change
Bank of America Corp... 14.13 -0.23 -1.60%
Freeport-McMoRan Inc... 11.80 -0.21 -1.75%
Apple Inc 93.62 0.57 0.61%
Micron Technology In... 10.00 -0.36 -3.47%
General Electric Co 30.07 -0.56 -1.83%
Data as of May 4
Sponsors

Sections

Tesla CEO Elon Musk had said previously that the automaker would become "cash-flow positive" this year. But in a letter to shareholders Wednesday, Musk signaled that won't be the case after all. More

The jobs market is near full employment with 14 million jobs added since early 2010. Gas prices are cheap. Home prices are rising. The stock market is near record highs. So why does everyone think the economy stinks? More

Oakland-based tech startup Clef hosts dinners for the local community in a bid to resist gentrification and unite all types of industries that make up the city. More

Visa says new software will allow consumers to check out with chip cards as fast as swiping a card with magnetic strip. More