Who is to blame for the unsustainable expansion of America’s welfare state? – a look at food stamps
Amid all the talk about whether or not President Obama won reelection on the votes of people who simply want handouts from the federal government it is worth paying attention to how America’s safety net actually works. In a fascinating report at National Affairs David J. Armor and Sonia Sousa provide an analysis of just how relief gets to the poor (and not-so-poor) and how it has grown in the past few years. In this post I want to focus in particular on what they say about food aid programs. The major programs in view here are the Supplemental Nutrition Assistance Program, or SNAP (formerly known as food stamps) ($68 billion in 2010), the school lunch and breakfast program ($14 billion) and the Women, Infants, and Children (WIC) program ($6.7 billion).
The baseline point to note is that food aid programs have in fact dramatically grown under President Obama. Armor and Sousa write:
Between 1992 and 2007, spending on food programs did not vary by more than a few billion dollars, after adjusting for inflation. But according to the Congressional Budget Office, spending on food programs rose from $57 billion in 2007 to $95 billion in 2010 (again, adjusted for inflation), an utterly unprecedented increase of 66%….
Between 2000 and 2010, the number of persons receiving food stamps more than doubled, increasing from 17 million to slightly more than 40 million. Real spending more than tripled during this period, rising from $22 billion to $68 billion.
Map: Percentage of People in each county who receive food stamps, June 2009
What are the reasons for the expansion? Obviously the recession has been a big part of it, but the growth of food aid programs outpaces the growth in the number of persons receiving food aid. The main reason for this is President Obama’s 2009 stimulus program, which purposely sought to increase the benefits received per person.
The expansion of the number of people receiving food aid also owes to factors other than simply the recession.
During the recession of the early 1990s, enrollment increased by several million — understandably, given that the poverty rate rose to 15%, roughly the same as the rate in this most recent recession. But between 2003 and 2007, when the economy was strong and poverty rates were relatively modest, SNAP enrollment nevertheless climbed to 26 million people. And after 2007, enrollment figures skyrocketed — climbing to 33 million people in 2009 and to 40 million in 2010.
Note that enrollment was climbing significantly already during the Bush administration, although the climb became steeper after 2007 owing to the recession. In part we might say that this latter climb simply demonstrates that the program is working. In hard times more poor people are receiving help.
Yet here’s the rub. Much of the increase in food aid programs reflects financial support that is not going to the poor. “Most of the increases in food-stamp participation in the past several years have instead resulted from an increase in benefits going to people above the poverty line” (emphasis added).
As early as 2004, nearly 40% of households receiving food stamps were above the poverty line… [I]n 2010 it reached 48% — nearly half of all households receiving food stamps. The increase in the number of households participating in the food-stamp program is thus being driven disproportionately by households above the poverty line.
Considered in terms of individuals more than half of all food aid recipients are above the poverty line. Most people who receive federal aid are not poor according to the government’s standard of poverty.
Just as striking is that most of the people above the poverty line who are receiving aid are well above the poverty line: “Another 7.2 million recipients have incomes between 130% and 200% of the poverty level, and an astonishing 8 million recipients have incomes that are greater than 200% of poverty.”
What’s going on here? In significant part it has to do with the relaxation of “categorical eligibility” rules under the Obama administration. “Categorical eligibility allows states to declare large numbers of families eligible for SNAP without actually going through the SNAP program’s own process for determining eligibility.”
Who are the culprits? It’s not necessarily who you would think and it bears little resemblance to the map of blue states and red states. The states that provide SNAP benefits to families with incomes up to 200% of the poverty line include Montana, North Carolina, and North Dakota, as well as Maryland, Massachusetts, and Washington. States that provide benefits to families earning up to 160% of the poverty line include deep red Texas and Arizona as well as Connecticut and New Mexico. Perhaps most interesting of all is that staunchly blue New York and California hold standards much stricter than many other states, keeping the eligibility line at 130%.
This makes a big difference. If all states awarded food stamps to individuals up to 200% of the poverty line – which is perfectly permissible under current federal rules, no less than 94.4 million Americans, nearly a third of the nation’s population, would receive food stamps from the federal government.
These numbers suggest that it is categorically wrong to blame the poor – or programs designed to help the poor – for America’s financial problems, or even for the recent growth of the welfare state. In fact, the vast majority of federal dollars redistributed in this country go to segments of the population above the poverty line and even to the middle class, including in particular seniors and veterans.
Republicans should abandon rhetoric critical of the safety net, or of programs designed to help the poor like Medicaid and focus instead on reforming these programs so that they actually help the people they were established to help. Too often Republicans are willing to criticize redistributive programs that benefit typical Democratic constituencies (think of Romney’s 47% comments) but not to criticize those programs that benefit their own favored constituencies (i.e., seniors). This suggests to many people – rightly or wrongly – that they don’t care about the poor. It also suggests that Republicans know how to be Santa Claus just as much as do the Democrats. The divide here is not as much about principle as many conservatives would like to imagine.
Democrats, for their part, need to ask themselves whether they really want America to be a country in which a third of the population is on food stamps. They also need to come to grips with the fact that raising taxes on the rich is not going to put America back on the path to welfare state sustainability. It’s all fine and good to talk about helping the poor and needy, but when it comes down to it it will be the benefits the federal government gives to the middle class that will wreck this country’s budget. It’s time for a serious conversation about what the American welfare state is actually accomplishing.
Posted on November 16, 2012, in Barack Obama, Welfare State and tagged food stamps, Medicaid, Mitt Romney, school lunch, SNAP, WIC. Bookmark the permalink. Comments Off on Who is to blame for the unsustainable expansion of America’s welfare state? – a look at food stamps.