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WESTON, Conn. Gov. Dannel P. Malloy predicts the recent debt ceiling deal will have a "devastating" long-term impact on the state's poorest and most vulnerable residents, including some of the elderly. For one Weston resident, however, government spending is the overriding issue. "There's got to be an end," says Joseph Spetly.
"It bothers me that U.S. debt goes up and up and up and up and up. The government is a big family, and it spends more than it is taking in. It has to stop," Spetly said as he attended a luncheon Wednesday at the Senior Center.
But Malloy, other top state officials and some of Connecticut's seven-member Congressional delegation -- which split its vote 4-3 in favor of the compromise plan to end the debt ceiling crisis -- are worried about the plan's impact, which they believe will be felt in the future.
It is an agreement being criticized by both liberals and conservatives alike but for opposite reasons Tea Party Republicans saying it doesn't cut enough, and Democrats insisting the cuts are too deep.
The deal includes $917 billion in immediate spending reductions, with a special bi-partisan commission yet to be established responsible for finding $1.5 trillion in savings or revenue enhancements, such as new taxes.
"It's going to be very important that we have a balanced approach to fiscal responsibility and meeting the needs of residents going forward," said Helen de Keizer, chairman of Weston's Commission on Aging.
U.S. Rep. Jim Himes said that while it wasn't the deal he wanted, he voted in favor to avoid a "catastrophic first-ever default by our government."
"The Republicans control the House of Representatives and Tea Party Republicans were willing to push this country over the financial cliff for political motives," the 4th District Democrat said. "But this fight is far from over," he said, adding he has requested being named to the Congressional panel that will decide where most of the cuts are made.
Connecticut officials say the long-term effect could close or reduce vital social services programs and significantly reduce aid and services to the poor and elderly.
Malloy said he is worried most about federal aid for Medicaid, the health insurance program for the poor that, with $9.3 billion budgeted over the next two years, is Connecticut's largest single expense.
While Malloy and other state officials said Connecticut will receive about the same amount of money for Medicaid over the next two years, he added that cuts could "be devastating in post-2013."
Officials in the state's Department of Social Services say they are worried too.
"Medicaid is the biggest expense in Connecticut and any measure that might cut Medicaid revenue is going to be a complex problem," said Kathleen Kabara, spokeswoman for the state Department of Social Services. "But until we get absolute dollar amounts it is not possible to begin the process of deciding where cuts will need to be made. ... The agency's first concern is always to best preserve core, direct services and to protect the most vulnerable populations."
Connecticut's Medicaid coverage includes health insurance for the disabled and nursing home costs for the elderly.
Though the deal will likely exempt Medicaid from rate increases, Medicare could be impacted as part of the commission's decisions, as well as Social Security and food stamps.
Connecticut State Comptroller Kevin Lembo said the state's finances could be hurt even sooner than 2013 if federal funding to states is cut because of the debt-ceiling bill.
Lembo states in his August report to Malloy that while Connecticut's projected General Fund surplus reached $158.9 million for Fiscal 2011, the surplus heavily depends on federal funds.
Last year's surplus, Lembo said, relied on $739.6 million in federal stimulus funds, which the state will not receive this year.
"We reached this surplus using a federal lifeline that has disappeared," said Lembo. "Dollars we depend on year after year could suddenly disappear if federal spending cutbacks result in drastic funding cuts to Connecticut. One year's federal stimulus money could become another year's devastating federal cutbacks."
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