Continuing to screw the poor people.
Sure, the economy blows. It's awful. And the student loan bubble is about to burst and then the shit is really going to hit the fan. It's really tempting for the federal government to do what individual families do when they are facing a financial hardship - they cut out the good stuff. No meals out, no trips to amusement parks, no extra goodies in the stockings on Christmas morning. The non-essentials, essentially. It's bologna sandwiches and Hamburger Helper for a few months, and you gotta suck it up. 
When we move up the ranks to discuss the federal government, we seem them attempting to practice the same kind of logic. Cut out the non-essentials,  and reevaluate what we are spending too much of our money on. The only problem here is that the federal government doesn't really seem to comprehend what is actually essential. They keep increasing defense budgets, for example, but threaten to cut education and social service budgets. 
Maybe this is just me, but I think an individual is more likely to need food on their table every day than a fancy nuclear weapon a few decades down the road thrown at whatever country's throats we feel like shoving democracy down at that current moment.
Simply put, making poor people poorer does nothing but damage the economy further. A person who is supplied a small amount of food supplement money each month costs the state a lot less than a person whose children are taken into state custody when they can no longer be fed at home. A homeless person who makes use of a shelter once in awhile costs less money than a homeless person who has to be hospitalized for frostbite or hypothermia, or jailed for sleeping in public.
Whatever equations the federal government is doing to try to convince themselves that cutting social services will financially work for this country are being left unfinished, or the wrong variables are being used. While there is not much we can do to shape policy and what our legislators are determined to make law and mandate, we can reshape our own personal opinions about welfare and how it is used, and perhaps in the long run, the vicious circle won't be so vicious anymore.
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