The Heritage Foundation

The Morning Bell


WEDNESDAY, SEPT 16, 2009


What The Poverty Advocacy Complex Costs You



This Monday the Senate voted 83 to 7 to strip funding for the Association of Community Organizations for Reform Now (ACORN) from this year’s housing and transportation appropriation bill. The move came after upstart website BigGovernment.com posted videos showing ACORN employees in multiple cities across the country conspiring to help under cover reporters avoid taxes for criminal enterprises.
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Despite the swiftness with which the Senate acted, this is hardly the first time ACORN has been accused of illegality. Last fall when ACORN was investigated for vote fraud in a dozen states, the New York Times reported that an internal ACORN legal memo raised “questions about whether the web of relationships among its 174 affiliates may have led to violations of federal laws.”

The Times reporter who wrote that story, Stephanie Strom wanted to pursue the story further, but she was discouraged by her superiors at the Times and gave up after blistering phone conversation with then-candidate Barack Obama’s presidential campaign. Strom revealed in an email: “I’m calling a halt to my efforts. I just had two unpleasant calls with the Obama campaign, wherein the spokesman was screaming and yelling and cursing me, calling me a rightwing nut and a conspiracy theorist and everything else.” Explaining why she wanted to pursue the story further in another email Strom wrote:



The real story to all this is how these myriad entities allow them to shuffle money around so much that no one really knows what’s getting spent on what — and for the charities like the housing orgs, that’s a problem. Charitable money cannot be spent on political activities. It’s a big no-no that can cost charitable organizations their exemptions.



That “web of relationships” between poverty advocacy groups like ACORN is the real story here that impacts the American people. ACORN is by far not the only suspect community organizer group. Just last summer federal investigators raided a city-chartered nonprofit agency accused of abusing a federally financed program that was created to clean up houses damaged by Hurricane Katrina. Teachers unions have contributed over $1.3 million to ACORN and its affiliates, since 2005. And the Service Employees International Union (SEIU) has chipped in another $7.4 million. ACORN founder Wade Rathke even has a book out titled “Citizen Wealth” which “shows how to cut through government indifference and bureaucratic obstacles” to achieve “maximum eligible participation” in the “anti-poverty programs still out there.”

All of this community organizing for an expanded welfare state has real costs. Heritage Foundation Senior Research Fellow Robert Rector will release a new study this morning that crunches the numbers on what the poverty advocacy complex is costing Americans tax payers and the results are sobering:


Over the next decade (2009-2018), President Obama will spend $10.3 trillion on welfare programs. This includes cash, food, housing, medical care and targeted social services for poor and low income Americans. Of this spending $7.5 trillion will be federal spending and $2.8 trillion will be state government matching contributions to federal welfare programs.
President Obama will spend twice as much on welfare as Clinton did, after adjusting for inflation. Over the next decade welfare, spending will amount to around $300,000 for each person currently living in poverty, or, on average, $1.2 million for a poor family of four.
President Obama will spend more on welfare in a single year (FY2010) than Bush spent on the Iraq war during his entire presidency.
Total cost of the War on Poverty since its beginning in 1964 has been $15.9 trillion. By contrast the total cost of all other wars in our nation’s history has been $6.4 trillion.
If total welfare spending were divided equally among all poor persons, each would get, on average, $16,800 in welfare benefits.


That last point is key. Gallup has a new poll out today showing that on average, Americans believe 50 cents of every tax dollar that goes to the government in Washington, DC, today are wasted. The American people know that when the federal government funnels their money through groups like ACORN, that money ends up benefiting professional poverty advocates, not real Americans in need.

QUICK HITS

House Judiciary Committee ranking member Rep. Lamar Smith (R-TX) called on the FBI and the DoJ to open investigations into ACORN.

Also according to Gallup polling taken after President Obama’s speech, 38% say they would advise their member to vote for a bill, while 40% oppose.

Sen. Olympia Snowe (R-ME) said yesterday that she could not back Senate Finance Committee Chairman Max Baucus’ (D-MT) health care bill.

Sen. Jay Rockefeller (D-WV) also said yesterday he would vote against the Baucus bill.

According to the Washington Post and Wall Street Journal, the individual mandates in Obamacare will force middle-class families and young adults to bear the brunt of the costs of reform.