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Blogger/Editor/Founder: Bill Smith, Ph.D. [aka: OzarkGuru & 2010 AFP National Blogger of the Year]
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One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors. -- Plato (429-347 BC)

Thursday, June 14, 2012

Five Facts About Food Stamps and the Welfare Budget

With the Senate considering the Farm Bill today, the office of Sen. Jeff Sessions (R-AL), Ranking Member of the Senate Budget Committee, released the following list of facts on food stamps and the Welfare Budget:
Since President Obama has entered office the food stamp budget has doubled and is projected to remain at permanently elevated levels (pictured below) for the next ten years.
It now comprises 80 percent of the farm bill.  Ranking Member Sessions responded yesterday to the suggestion that continual increases in food stamp registration should be a central policy objective.  Senator Gillibrand, for instance, described surging the number of people on food stamps as an “extraordinary investment.” Sessions countered that the better, more compassionate, investment was to improve both the food stamp program, and economic opportunity, so that a greater number of Americans “achieve financial independence.”  Sessions asked: “Is it our national goal to place as many people on welfare, food stamp support, as we can possibly put on that program? Is that our goal? Is that a moral vision for the United States of America” [Video here].

With those questions in mind, here are five important facts about the food stamp program:

1) Enrollment in the food stamp program has risen from 1 in 50 Americans to 1 in 7. When the program was first expanded nationally in the 1970’s, approximately two percent of Americans received the benefit.  Today, it’s closer to fifteen percent.  Over the next ten years, following the current plan, no less than 11% of Americans will receive the benefit at any one time.

2) Food stamps are not a sole source of federal income support, but part of a patchwork of federal welfare that includes almost 80 means-tested welfare programs, including 17 for nutrition. Together, these means-tested programs result in $900 billion in annual spending ($700 billion in federal dollars and $200 billion in corresponding state contributions or obligations).  An individual enrolled in the food stamp program may receive, cumulatively, as much as $25,000 a year in federal income supplements for their household in the form of means-tested welfare.

3) 39 states have completely waived the statutory asset test for food stamps. Under categorical eligibility, a state can increase its food stamp allotment by providing food stamps to individuals whose assets exceed the statutory limit as long as that individual receives some other type of federal benefit (in one state, federal brochures were mailed to people whom, as a virtue of receiving those brochures, were then deemed eligible).  One of the four amendments filed by Senator Sessions would, in effect, require individuals receiving food stamps to meet the eligibility requirements.  That modest reform, along with the other three filed by Sessions, has so far been blocked by Reid from consideration.

4) Under the farm bill food stamp spending will remain permanently elevated at more than double pre-recession levels. Food stamp spending ($82 billion in FY13) has quadrupled since 2001 ($20 billion).  It doubled between 2001 and 2006 and again from 2008 ($40 bil) to 2012 ($80 bil) and is now 80% of the farm bill. Yet, under the current proposal, CBO estimates food stamp spending will remain permanently elevated  -- averaging $77 billion a year for the next decade. To illustrate the size of the increases at issue, were food stamp authorizations set to pre-recession levels from 2007, and grown at the inflation rate each year thereafter, it would result in a 10-year savings of $340 billion.

5) States receive bonus pay to increase food stamp enrollment. Senator Sessions has discussed the “perverse incentive” states have to constantly increase food stamp enrollment rather than to allocate each dollar as wisely as possible: the money is provided by the federal government but administered by the states. The bonus pay for expanding registration highlights the policy problems with this dynamic. One of the amendments filed by Sessions (also blocked, for now, from consideration) would remove the bonus pay so that the emphasis is placed upon targeting resources to those in need. Another reform would close a well-known loophole that allows some states to dramatically increase their federal allotment on the basis of home energy expenses regardless of what expenses are actually paid, and another would put in place an e-verify style system known as SAVE.  Read more here.

Tags: Food Stamps, Welfare Budget, Farm Bill To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. Thanks!
Posted by Bill Smith at 2:09 PM - Post Link


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