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LUNCH ON THE RIVER OR THE BALCONY BRUNCH ON SUNDAY! . . . and Sandwiches, Chili, Tacos, Chalupas, and restaurant baked desserts. Haagen Dazs Ice Cream and fresh yoghurt. Soup and salad bar. 11:30 am until 5:00 pm Monday thru Sunday. 224-4515 the greenhouse Above the Kangaroo Court Downtown Riverwalk 314 North Presa San Antonio, Texas Ju Steve Russell Travis County Court at Law Number Two Contributing Editor, The Texas Observer, 1977-1978 Pd. Pol. Adv., Steve Russell, 3511 Hollywood Ave., Austin, Texas 78722 Postmaster: If undeliverable, send Form 3579 to The Texas Observer, 600 W. 7th, Austin, Texas 78701 `New Federalism’ . from page 7 responsibility for a program that, for better or worse, has not cost Texas taxpayers much money. Simultaneously, Texans will be required to pay the total cost of the foodstamp program. But since foodstamp allowances in Texas have been comparatively generous, Texas will be swapping a relatively cheap program for a relatively expensive program. The terms of this trade, therefore, guarantee an unfavorable fiscal impact. Most probably, Texas can expect a net loss of at least $1.6 billion per year and probably much more once inflation is factored into the calculations. Obviously, David Stockman and President Reagan are aware of this. This is why they proposed the New Federalism in the first place. Both men have vowed to slash federal spending. By transferring the financial burden to the states, the New Federalism will certainly help them achieve that goal. Even more alluring from their perspective, the New Federalism shifts the political headache of financing safety-net programs to state officials. If that happens, Reagan and Stockman can simply sit back and watch as harried state officials try to cope with increased demands for social services and declining federal support that will more than eliminate most state surpluses. In most states, therefore, the New Federalism will leave officials with only two choices cut programs or raise taxes. In Texas, however, program cuts may be the only currently-legal option. The Texas Constitution declares that “the maximum amount paid out of state funds to, or on behalf of, any needy person . . . shall not exceed the amount of eighty million dollars during any fiscal year.” The constitution also stipulates that welfare appropriations must be supplemented by matching federal funds. Since the New Federalism withdraws all federal funding, there would be no matching funds and any state appropriations would probably be unconstitutional. But even if we solve the matching fund issue, state appropriations are limited to $80 million at a time when, even according to Reagan’s estimates, state spending on AFDC and foodstamps will have to rise to $726 million if the state intends to fund these programs fully. A constitutional amendment scheduled to be sent to the voters this November does little to alleviate the problem. It would restrict state appropriations for foodstamps and AFDC to one percent of all state-spending. Should it be approved, spending could rise to over $170 million a year still far short of the financial burden Reagan plans to dump in the legislature’s lap. For Texas, in other words, the New Federalism means only one thing no social services. DO IT TODAY! Send the Observer to name address city state zip this subscription is for myself gift subscription; send card in my name $20 enclosed for a one-year subscription bill me for $20 name address city state zip THE TEXAS OBSERVER 600 W. 7th, Austin, Texas 78701 32 APRIL 23, 1982