Air Date: Week of February 18, 2011

President Barack Obama defends his 2012 budget proposal, including controversial cuts to a federal program that helps the poor pay their energy bills.

A federal energy assistance program that began in the Reagan administration could be cut in half by the Obama administration. The president has proposed a $2.5 billion dollar reduction to the budget of LIHEAP, or Low-Income Home Energy Assistance Program, which helps struggling families pay the bills that heat and cool their homes. LOE’s Washington correspondent Mitra Taj reports on the controversial budget item.

Transcript

GELLERMAN: Secretary Steven Chu is big on energy efficiency. The Department of Energy has been funneling funds into a program to help poor households weatherize their homes - creating jobs, lowering electricity bills, and cutting greenhouse gas emissions. But what could get cut next year is a federal program that helps low income households pay for their energy bills. That's another proposal in President Obama's 2012 budget. Living on Earth's Mitra Taj has our story.

TAJ: Leroy Canty says he knows how the President feels: planning a budget during tough times is a struggle. He’s 64 and retired, but works part-time at a grocery store called Giant Food in Washington.

[GROCERY CARTS CRASHING]

TAJ: He’s a courtesy driver - giving shoppers a ride home in his brown minivan.

[DOOR CLOSES, ENGINE STARTS, BEEPING]

TAJ: His social security check brings him just $900 a month.

CANTY: That’s not a lot of money, not a lot. If it wasn’t for my wife, you know, I’d be up the river without a paddle.

TAJ: As he drives through the city on a cold night, he points toward the convention center - an elegant structure he helped build during the decades he worked as a carpenter. Now, it’s where he goes to apply for help to pay his heating bills. He says in his neighborhood, he’s not the only one who gets in line for federal funding.

CANTY: Most everybody around here uses it. The two tall buildings right here, all these people around here…everybody uses it. So if they’re gonna cut it - oh my goodness that’s gonna be a thing.

TAJ: LIHEAP, or the Low-Income Home Energy Assistance Program, started under the Reagan administration. Now the Obama administration proposes cutting it in half from its current $5.1 billion dollars. If Congress approves the president’s proposal, Canty and his wife will have to pay $140 a month for their winter electricity bills instead of about $20.

But Obama says he’s just restoring LIHEAP’s budget to what it was in 2008, before Congress doubled it to cover a spike in energy prices.

OBAMA: Energy prices have now gone down, but the costs of the program have stayed the same. So what we've said is, "Let's go back to a more sustainable level. If it turns out that once again you see another huge energy spike, then we can revisit it."

TAJ: But Chad Stone, chief economist with the progressive Center on Budget and Policy Priorities, says energy costs are about to go up again.

STONE: The administration’s argument that energy prices are substantially lower than they were in 2008 - that’s true about what prices were in the summer. But it turns out that the prices that matter for LIHEAP for the most part are prices for the winter heating season. And the forecast is that this coming winter, prices are going to be about that same level.

TAJ: A lot depends on how you heat your home. While natural gas prices have gone down, heating oil and propane prices have gone up. Mark Wolfe is the executive director of the National Energy Assistance Director’s Association. He says, in 2008, the annual average cost to heat a home was 1,010 dollars. Now it’s 960 dollars.

WOLFE: So for those families, when you say prices have come down, they don’t know what you’re talking about. As far as they’re concerned, it’s as high as ever.

TAJ: No one in Congress has come out to enthusiastically embrace Obama’s LIHEAP budget cut for 2012. And Nick Loris, with the conservative Heritage Foundation, says he can understand why.

LORIS: When we’re spending, you know, billions of dollars a year and we’ve run a 14 trillion dollar deficit, a two billion dollar cut or five billion dollar program targeted towards low income energy assistance isn’t the most politically attractive one to remove.

TAJ: Like many Republicans, Loris thinks increasing domestic energy production is the answer to lowering energy prices for people in need.

Some suspect the President is trying to look tough on the deficit, while betting lawmakers will save the popular program. But if the cuts do go through, Mark Wolfe says three million people will be pushed off the program and toward risky decisions.

WOLFE: We know what they do – there’s plenty of research now. They turn the heat down to sometimes dangerously low levels. If you're an elderly person and your house is cold, your high blood pressure medicine doesn't work as well, we know that there are higher rates of stroke and other illnesses.

TAJ: Leroy Canty says he’d do what he did before he knew about LIHEAP - he’d turn off his heater, and turn on the stove, even though he knows he risks carbon monoxide poisoning.

CANTY: It is very dangerous, that's why you put it on for a little while, you know, like 2-3 hours, then you go and cut it back out, then wake up in about another 2-3 hours, go back, put it back on, but that’s still dangerous you know. But a lot of people just use theirs the whole night and that's not good.

TAJ: The ball is now in Congress’s court, and House Majority speaker John Boehner has said painful cuts, including those to LIHEAP, are needed because “we’re broke.” For Living on Earth, I’m Mitra Taj in Washington.

GELLERMAN: Well, balancing the budget is difficult, but it’s no easy task lifting it either. President Obama’s proposal makes for heavy reading. It’s two thousand four hundred and forty-eight pages, weighing in at a whopping 10 pounds. Thirty thousand copies are printed which adds up to nine million, two hundred and sixty-one thousand, one hundred and eight sheets of paper - or 1100 trees.

But the paper contains 30 percent recycled material, and the ink is vegetable oil based. If you want your own copy of all four volumes it will set you back a budget-busting two hundred and fourteen bucks. But shipping is free - and there is no tax.

 

Links

Click here for Chad Stone's analysis of energy prices and LIHEAP funding.

Recent stats on growing demand for LIHEAP.

Why Nicolas Loris supports cutting LIHEAP's budget.

NEADA looks at how many people could be cut out of assistance.