Reagan policies and children -- what effect?

One woman's tale of woe had much of Massachusetts astir recently. The situation pointed up what critics find wrong with present trends in social programs for the poor - especially since President Reagan came to office.

The Massachusetts woman testified at a state legislative hearing that she, her mother, and her two children lived in a car on Cape Cod for two years because she didn't qualify for AFDC (aid to families with dependent children) benefits. Reason: She had no address.

Social activists contend that the nation's needy children have not received adequate attention from Washington since the Kennedy and Johnson administrations. Hardest hit, they say, are programs for children whose parents continue to work but are below the poverty line of $7,412 for a family of four. And their criticism has intensified since Mr. Reagan submitted his fiscal 1984 budget to Congress.

The criticism is unjustified, argues Edwin Dale Jr., a spokesman for the White House Office of Management and Budget. ''I don't think the case is very strong that this budget has any significant cuts in it for children's programs, '' he says.

It remains a sore point with the critics that the administration, in its first budget, combined key social programs into generalized block grants to the states.

This has cut most of the federal strings over distribution of the money and - in cases like the Massachusetts woman and her family - allowed some needy people to fall through the cracks as eligibility requirements have been tightened by states. It also has led to the rise of workfare programs in some states. Indeed, Mr. Reagan's budget proposes to make workfare a requirement for AFDC recipients who are able to work.

''What is your definition of common decency?'' asks Virginia Bannerjee, formerly of the Child Welfare League, who now heads her own consulting business in New York. ''It is almost axiomatic that in difficult economic times you're going to need morem services rather than less.''

But take the two main props helping to support the poor and disadvantaged - food stamps and AFDC. If Congress goes along with Reagan proposals, actual spending for the two categories will be cut from $12 billion to $10.9 billion and from $10 billion to $7.1 billion, respectively, compared with the fiscal 1983 budget.

''What we pay in AFDC and food stamps is less than we pay military retirees, '' notes Michael Petit, commissioner of the Maine Department of Human Services. He is studying the problems of disadvantaged children for the National Governors' Association. Indeed, the budget for military pensions calls for $16.8 billion in 1984 - a $1.3 billion increase over the current year.

Counters Mr. Dale: ''That comparison has no meaning. We pay more interest on the national debt, too.''

There are as many people receiving food stamps now as there were when Reagan assumed office, according to Dale. Moreover, the critics' argument ignores the $ 13 billion increase (to $36.9 billion) budgeted for unemployment compensation in fiscal '83 - much of it going to persons with children, he adds. Anticipating a drop in the jobless rate, the administration is seeking $28.8 billion in unemployment compensation for 1984.

Other cuts protested by the critics: Spending for child nutrition programs would be reduced by 8 percent, to $2.9 billion. The program that subsidizes fuel purchases for low-income families would be funded at $1.3 billion, as opposed to the nearly $2 billion Congress authorized for it in the current fiscal year.

On the other hand, the administration would hike spending on the Head Start program - aimed at preschool children from poor families - by 6 percent, to $1. 05 billion. And the number of children covered by the program would increase by almost 30,000. Foster care also would receive a hefty boost - from $395 million to $440 million.

But at the same time, elementary, secondary, and higher education aid would be cut by twice that percentage - a drop to $13.2 billion.

The President also budgeted $22 million for fiscal 1983 for child welfare, child abuse, social services, and adoption opportunities research programs. But in 1984 they would be combined and funded at just $9 million. The package would be labeled human-resources research and development.

Combined with budget cuts approved by Congress over Reagan's first two years, the new budget proposals would mean a $12.5 billion slash in federal spending on poor and disadvantaged children over what would have been the case under previous law, according to the Children's Defense Fund in Washington. Some 20 programs would be affected, the group said.

Children's Defense Fund director Marian Wright Edelman claims the level of federal spending actually has dropped from what would have been $67.4 billion for fiscal 1984 without administration and congressional intervention to $55 billion.

''Part of what is little understood is that Reagan is only doing far more effectively what was starting under Jimmy Carter,'' says Pat Langley of the Washington office of the Family Service Association of America (FSAA).

''Generally, I think the impact is nothing short of what's been going on - only worse,'' agrees Carol Stark, director of the Center for the Study of Family and State at Duke University in Durham, N.C.

The assumption that families do best when left alone - even in times of stress - is consistent with Reagan's view, says Ms. Langley's colleague, Bob Rice, of the FSAA's New York office. ''And there's some merit to that,'' he adds.

But the problem with this theory is that piling more problems on top of those the family already has can drive it to the breaking point, Mr. Rice says. This is especially true of the working poor.

Working women with children who have lost such benefits as subsidized day care ''are among the most alone in our society,'' Rice says. ''Plus, their number is growing.''

Ms. Stark puts it even more bluntly. The trend in federal spending, she says, ''pits the welfare poor against the working poor for scarce resources, with the result that the competition becomes even fiercer.''

States where wages are lowest also have the most working women, she adds. But women who earn the minimum wage - $3.35 an hour - still are forced to spend as much as one-third of their income on day care.

''Cutting day care, it really is amazing that women stay in the labor force, '' Ms. Stark says.

Under Reagan, ''services are down, welfare is down, and all the while poverty is growing,'' laments Rice.

Ms. Bannerjee says the administration deserves high marks for efforts to involve volunteers in the child-welfare effort. ''But it's naive to think that that can pick up the slack,'' she adds.

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