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  • Cutting LIHEAP Doesn't Mean Poor Will Freeze

    At first glance, President Obama’s motion to kill a program that provides low-income families with energy sounds as politically attractive as legislation to drown puppies, but when you take a look at the Low-Income Home Energy Assistance Program (LIHEAP), it makes all the sense in the world.

    LIHEAP has become a rapidly expanding federal program meant to help America’s households with the lowest incomes pay their fuel bills. The funding for LIHEAP more than doubled in the past few years, increasing from about $2 billion in 2008 to $5.1 billion this fiscal year. President Obama’s fiscal year 2012 budget request cuts LIHEAP to $2.6 billion. Despite the noble intentions behind LIHEAP, it is a program beset by fraud and waste, and it fails to address the real issue of reducing high energy prices by increasing energy supplies.

    Nobody wants the heat shut off on low-income households in the middle of winter, which is why state laws prohibit utilities from doing so, making LIHEAP duplicative. In reality, that money just goes to utilities that would not have collected the money. In many cases the money is lost to fraud and abuse. A June 2010 Government Accountability Office report on LIHEAP found that:

    • The Department of Health and Human Services sent $3.9 million to 11,000 deceased people to pay heating and cooling costs out of the LIHEAP.

    • The state of Illinois “provided $840 in energy assistance to a U.S. Postal Service employee who fraudulently reported zero income to qualify for LIHEAP. Despite earning about $80,000 per year, the employee stated that she saw ‘long lines’ of individuals applying for LIHEAP benefits and wanted the ‘free money.’”

    • Claims processors did not practice due diligence. The report states, “Posing as low-income residents, landlords, and an energy company, GAO used bogus addresses and fabricated energy bills, pay stubs, and other documents to apply for energy assistance. All fraudulent claims were processed and the energy assistance payments were issued to our bogus landlords and company.”

    President Obama defended the cuts by saying that, because energy prices are lower than they were in 2008, the funding does not need to be nearly as high. He went on to say, “If it turns out that, once again, you see a huge energy spike, then we can revisit it, but let’s not just assume because it’s at a $5 billion level that each year we’re going to sustain it at a $5 billion level regardless of what’s happening on the energy front.”

    Instead of worrying about how to use taxpayer dollars to help Americans with high energy prices, the Administration and Congress should focus on a policy that makes energy affordable in the United States. Increasing access to our own energy reserves onshore and offshore and allowing access to easy imports from Canada would be a more prudent solution. President Obama should be applauded for his budget cut to LIHEAP. It is a step in the right direction; however, without the proper reforms to the energy market, it will do nothing to help Americans cope with higher energy prices.

    Posted in Energy [slideshow_deploy]

    15 Responses to Cutting LIHEAP Doesn't Mean Poor Will Freeze

    1. LibertyAtStake, Alex says:

      Catching my eye is Obama's quotation in the next to last paragraph – highlighting the false Progressive / Statist assumption that government is even capable of responding to market forces as they occur. It's just not, and that's the whole point of the grand national argument we are now having.

      "Because the Only Good Progressive is a Failed Progressive"

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    4. Bobbie says:

      There are solutions to make it affordable! The president looks the other way conjuring up another financial crisis. Obama wants it to look as if the poor will freeze. That's why he talks without explanation, so he can spin it to say he was forced by republicans.

    5. NoPolitician says:

      Do state laws force oil companies to deliver oil to households that do not have the ability to pay for it? Seems like a pretty big flaw in your argument that the poor won't freeze — oil companies are not public utilities. If you can't pay, you don't get oil, and your furnace turns off.

    6. Steve says:

      Why the apologetic tone, or need to explain? This is just one of thousands of federal programs that are unconstitutional, unaffordable and counterproductive.

      • Joe says:

        oil subsidies are unconstitutional, unaffordable, and counterproductive, as they actually create super concentrations of capital, and decrease competitiveness in the market. Private, for-profit corporations should not control the basic necessities of the poor, working class, or upper-middle class.

    7. Nicolas Loris Nicolas Loris says:

      State and local programs exist to provide that oil delivery, especially to the states that rely on oil for heat: Alaska, Connecticut, Delaware, Indiana, Maine, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, Virginia, Washington DC, Wisconsin

    8. Bobbie says:

      NoPolitician= that''s true. We live north and have our thermostat at 58 because we can't afford it. Yes, it is cold and uncomfortable but it's what we have to do to maintain our independence. You're right the poor do freeze because of the cost and the government's unwillingness to bring that cost down especially when there is no significant reason not to.

    9. Carol says:

      State laws prohibit turning off power ergo heat but the bill keeps rising for the person unable to pay! Yet power companies have been reaping profits (in this area Constellation Energy) unheard of before due to subsidies! Why squeeze the poor if the rich are being paid at both ends?

      People do have their power turned off and in a state or location where electricity is the means of heating, it is a double whammy…no lights and no heat!

    10. RHytonen says:

      This is simply a lie.

      If you can;t pay your bill, the gas company WILL shut you off in a heartbeat – at least here in WV.

      And seniors WILL die, make absolutely no mistake.

      We are on (one) SS only,m and will definitely freeze next winter!

      We still can't pay all of last year's, when LIHEAP was ALREADY cut in half.

      As for constitutionality and the "apologetic tone," I really couldn't care less about your tone, or your ignorance of the Contitution, the public good (and actually, "welfare;") very much including the unalienable right (of an adult, lifelong productive, now senior, citizen) to life – considered by most a necessity well before receiving liberty or the ability to pursue happiness. These are the promises spelled out as to be expected, in and of the richest country in the world – especially after working all one's life and finally being unable to do so, as we ALL will.

      Because you and I have a MUCH bigger problem, if you want me and mine to freeze to death.

    11. BSeeley says:

      My heat comes from heating oil. This year 2011, I was notified that I no longer qualified for liheap…even though I make exactly pay now that I was making last year (and I did qualify). I work full time, and I make nowhere near enough money to buy enough heating oil to last me a winter.

      Utilities do not control the flow of heating oil, and when I run out …that's it. So I'll remember what you said about no needy families are going to freeze as my children are shivering this winter, huddled around the kitchen stove with the oven door open to keep warm.

      His funding cut does NOTHING to stop fraud. It only hurts those who are honest with the application process.

    12. Abe says:

      My Grandmother put 50 quarters in social security. Because of "fiscal conservatives," though, she qualifies for almost every low income program out there, because the rules were changed on her. This includes LIHEAP. I do not understand how people can say that people like her, a 79 year old woman who put fifty quarters in Social security is a freeloader and needs to be more responsible, and not rely on "handouts". Now, she pays the price, even though she was part of a generation that built this nation to where it is today, was a working for more than 60 years, and therefore has the right, not the entitlement, to be treated fairly, which she is not.

    13. Abe says:

      If anyone has been taking handouts, it is the richest 1 percent and the richest corporations in this nation. Not to mention corn subsidies, given to huge conglomerate farms. There is a reason why this country is ranked 11th in terms of quality of life in the world, and its not because of social welfare programs.

    14. Claudia says:

      My neighbors and I depend on wood or propane to heat our houses. Don’t soothe yourself into thinking that people won’t die because of this cut, they will. There is no law that says that propane companies or the boy scouts must deliver wood to the poor regardless of ability to pay, it’s all pay as you go. No money, no heat.

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