Download Making it all make sense

Globalization, Program Financing &
Budgeting, and How Services are Delivered
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Everything (policy, economic behavior, poverty,
immigration etc) is inter-connected.
Economic activity and control of international
organizations contribute to migration and poverty in
others.
Industrialized countries purchase raw materials
(lumber, minerals, agricultural products from others)
and products from others. Workers can be exploited
by large corporations and growers. Have few
economic opportunities in home country.
U.S. and other industrialized nations need immigrant
labor in order to produce products at low costs.
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Often trade agreements such as the North American Free Trade
Agreement NAFTA permit industrialized countries to operate
unregulated (wages and safety) industries in countries such as
Mexico. This allows U.S. corporations to make the products they
need because they can pay people less in these countries. In
addition, there are fewer jobs for U.S. manufacturing and service
industry workers because these jobs have been relocated.
U.S. corporations may purchase products made in countries such
as China and El Salvador and then look the other way when
workers are mistreated. Some political candidates, unions, and
other advocacy groups have proposed that NAFTA be amended to
provide worker protections in other countries.
Large corporations may flood foreign market with products or
agricultural goods that drive prices in those countries down and
limit economic opportunities.
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The Federal Reserve bank sets the amount it costs individuals and
corporations to borrow money.
When interest rates are low, more people can borrow and corporations are
more likely to borrow money to expand their businesses. When some
businesses expand, they hire more people. However, businesses can
choose to use this money for more technology or to relocate overseas.
When interest rates are higher, people who save rather than spend money
are better off. Some economists think that saving is better for the country
than spending because it creates a pool of money that the government can
borrow to cover deficits.
Rationale for the economic stimulus package is that people will use the
money to purchase products and therefore businesses will be able to
expand and hire more people. Some economists argue that instead of an
economic stimulus package should focus on infrastructure development
(such as building roads and bridges). This would contribute to more people
being hired for good paying jobs in the U.S.
Mortgage crisis is happening because large lenders such as banks and
mortgage brokerage firms sold home mortgages to people who might not
have qualified for large loans or offered loans with no down payments in
which the interest rates were adjustable. This means that the interest rates
were set higher the longer the person had the loan. As house values
decreased, many people owed more money than the value of their house.
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U.S. Government typically runs at a deficit, they don’t take in enough income
to cover all yearly expenses.
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The Federal government “borrows” funds from the Social Security System
and also borrows money at low interest rates from countries such as China
and Germany unless there is enough money at low interest rates for them to
borrow in the U.S.
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The accumulated deficit from year to year is called the debt. The U.S. must
repay the debt and pay interest on it. The money comes from the yearly
income of the Federal government. Consequently, payment on the deficit
takes money away from other social programs.
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Because of relationships among U.S. and foreign businesses and debt repayments, financial instability in the U.S. contributes to financial instability
in counties that the U.S. owes money to such as China and some of the
European countries. However, some analysts argue that China has contributed
to the current problems in the U.S. because the trade deficit with China is so
big, that China has been able to invest some of the surplus funds in the U.S.
and destabilized some aspects of the financial market place.
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Economic Policy is based on a mix of political and economic philosophy and
research on the economy.
Some of the guiding principles of a conservative approach to the economy are in
the book “Wealth of Nations” written in the 18th century by Adam Smith. Smith’s
argument was that under capitalism, “market forces,” the act of selling and buying
automatically creates the best economic conditions. Government should not
interfere with the market – some very conservative economists believe that
interference includes regulation of the financial sector (including banks) and the
provision of welfare services.
One alternative approach, Keynesian economics, views government efforts to
stimulate the economy (through building roads and other types of improvements)
as essential for a healthy economy.
Some critics of government policy have argued that government typically will
intervene in the economy to assist large corporations rather than middle and low
income people. Some types of government programs are believed to offer
subsides to businesses even when they have been established to help the poor.
For example, in the Central Valley, the availability of welfare and Medi-cal benefits
for eligible farmworkers (citizens and legal immigrants) permits ranchers to offer
only seasonal employment to farm laborers. The food stamp program and other
government food programs also benefit agriculture.
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U.S. and other western industrialized nations
control large funds that provide development
assistance to 3rd World Nations – International
Monetary Fund and the World Bank.
In order to qualify for loans, the non-industrial
countries, must reduce government expenditures.
However, many of these nations are so
impoverished that what they really need to do is
spend money on roads, education, and other
improvements that will aid economic development.
The World Bank and IMF policies are beneficial for
the U.S. and other industrialized nations.
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Industrialized countries hire immigrants to work in jobs
that require skills or for low wage work.
Therefore the economy is dependent on a supply of labor
for this source.
However, industrialized countries differ in terms of
policies on legal immigration and access to benefits such
as welfare and health care. Legal immigrants (such as
skilled workers and refugees) are treated differently that
people with few job skills or undocumented immigrants.
Often immigration controls are implemented when people
become fearful of people who are different from them.
Recent immigration reform proposals in the U.S. (i.e.
mass deportation or enforcement of immigration laws)
has failed because employers have a vested interest in
maintaining a low wage, unregulated work force.
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Programs for the poor (means-tested programs)
constitute a small proportion of the federal budget.
Government entitlement programs constitute a large
proportion of state budgets because of the
“matching” requirements in federal legislation (TANF,
Medi-Cal). States also spend a large proportion of
their budgets on education and prisons.
President/Governor proposes budget. Legislative
branch may change and must approve the budget.
President/Governor may veto the budget. Usually
detailed negotiations take place.
Fiscal budget year starts October 1 for the federal
government and July 1 for the state.
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Immigrants – tightening immigration requirements
– refusing services to undocumented people;
limiting services to permanent residents who are
not citizens.
Women – requiring work for single mothers on
welfare. Limiting benefits to welfare mothers who
have more children. Funding programs to promote
marriage.
People with disabilities – Supreme Court decisions
have limited the ability of people to sue for
reasonable accommodation. Some cuts in Federal
and state services for children and adults with
disabilities have been made or are proposed.
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Look at the percentage of funds allocated by program
type and for whom these services are intended.
Look at whether allocations for specific expenditures
increase or decrease from previous years.
Remember that because inflation affects the value of
a dollar’s purchasing power, no increase or a small
increase may actually represent a decrease in funds
allocated for a specific program.
No tax pledges mean that funding must come from
exiting revenue sources, an increase in fees for some
services, and cuts in some government programs and
services. No spending curbs with tax cuts may
increase yearly deficits and the national debt.
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Privatization – using nonprofit and for-profit
contractors to deliver some services.
Using faith-based organizations to deliver
government services.
De-emphasizing the role of professional service
providers in the delivery of some services.
Requiring that all government funded
organizations use performance based measures in
assessing whether private contractors are doing
their job. Reimbursement is based on
performance– sometimes this leads to the
exclusion of people with severe problems from the
service system (creaming).
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Where does the money come from (funding
categories; is it distributed equitably).
What is the amount of funding (how much
money is spent; is it adequate to meet
needs)?
What approaches are used to fund
programs?
How is the money appropriated/allocated or
reimburse?
Is the funding mechanism efficient or
effective?
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Private Market Place (selling and buying services)
Private Giving (Individuals, Bequests, Service
Clubs, Corporations/Unions, Foundations,
Federated/Consolidated Funding [example
United Way].
Benefits paid to workers (health insurance,
pension, other fringe benefits)
Social Insurance (Social Security; Medicare,
Unemployment Benefits). Sources: tax on
employees and employers.
Public/Government funding
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Federal income taxes on individuals and
corporations.
State income taxes on individuals and
corporations.
Local income taxes in some states.
Real estate taxes (local government; school
funding)**
Fees and other revenues
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Whether the Social Security and Medicare
systems can continue to pay for themselves.
Whether employers will continue to cover the
cost of employees’ health insurance.
Whether employers will continue to cover the
costs of employees’ pensions – shift to 401k
plans – this puts risks on employees.
Equity of reliance on property taxes for local
schools.
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Organizations must have decision-making
structures.
Designated Executive Director, CEO, or
management team.
Most organizations have centralized decisionmaking structures – decisions made by one or a
handful of people.
Administrators are the point of the
organization’s contact with external
environment.
Consequently, most organizations are
hierarchies.
Director
Supervisor
Staff
Staff
Supervisor
Staff
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Administrators Control Decisions
Limited Staff/client participation in
management decisions
Emphasis in social service organizations on
professional staff; some organizations,
however, may prefer non-professional staff,
volunteers, or a mix of all three.
Organizations may be client-centered
(responsive; oriented toward client advocacy)
or client/consumer controlled.
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Funding source
Ideology
Who founded the organization and the
organization’s purpose
Nature of the service provided
Auspice (public, nonprofit, for-profit, etc).
Strategies
Advocacy
Professional
Case Advocacy
Citizen Participation
Give decision-making
authority only to board
members and experts
Coordinate efforts with
other agencies
Coordination
Consumer
Self-Help Advocacy
and/or Political
Participation of
Constituents
Give decision-making
authority to consumers
Eligibility Requirements
Income-testing
Limited communication
and resource sharing with
other agencies
No income-testing
Staffing
Hire only professionals
Hire consumers of service
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Fragmented vs. Integrated or Continuous
System (does applicant need to obtain
services from more than one program or
reapply)
Degree of access to services
Degree of program accountability
Procedures that preserve due process
(procedural rights)
Degree of citizen participation in service
decisions
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Do the eligibility rules make sense in terms of targeting a
specific population group for inclusion in the program.
Is there ideological consistency between how the social
problem is defined and the eligibility rule. (For example,
emphasis on individual versus social responsibility).
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Will social stigma affect utilization?
Coverage – can people receive benefits if they are not
members of the target group?
Trade-offs associated with the rule. For example, do we
have to spend more to cover everyone or can we accept
that some people will be excluded if we keep costs down.
Potential for under and over utilization of services.