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Taking Stock of the Safety Net, Part 4: Helping Families Afford an Adequate Diet

As other posts in this series have shown, 2011 was another tough year for low- and moderate -income families.  One indicator is that over 2 million new people joined the Supplemental Nutrition Assistance Program — SNAP, formerly known as food stamps — between January and September (the latest month available).

SNAP now helps 46 million low-income Americans afford a nutritionally adequate diet, and it has been one of our most effective weapons against rising hardship and unemployment in the recession.  Indeed, the 46 million low-income Americans who now receive SNAP benefits include 19 million people who have come on the rolls since the recession started.  SNAP lifted 5 million people, including 2 million children, out of poverty in 2010, under the Census Bureau’s new Supplemental Poverty Measure, which counts the value of families’ SNAP benefits as income.

Every SNAP dollar that a low-income family receives to buy food increases the resources the family has available for food or other necessities, such as shelter.  (Low-income people generally need to spend, rather than save, nearly all of their income to meet daily needs like food and shelter.)  That, in turn, helps the broader economy because the added spending helps maintain jobs and boost other families’ incomes.  Economists estimate that a $1 increase in SNAP benefits when the economy is weak generates $1.72 to $1.79 in economic activity.

SNAP is due for renewal as a part of next year’s Farm Bill.  While the program is one of the safety net’s strongest, it can get even stronger.  In assessing the program, policymakers should (among other things):

  • Do no harm. A number of policymakers, most notably House Budget Committee Chairman Paul Ryan, claim that SNAP is growing out of control and must be cut.  This claim is false.  As we have explained, SNAP has done exactly what it is supposed to do:  respond to growing need during a severe economic downturn.  Congressional Budget Office figures show that, as the economy recovers, SNAP spending will fall nearly to pre-recession levels as a share of the economy.
  • Examine whether benefit levels are adequate. SNAP benefits are based on the Agriculture Department’s (USDA) estimate of the cost of a bare-bones monthly grocery bill, the “Thrifty Food Plan.”  Observers have long held that the plan underestimates poor families’ actual food costs and, as a result, that SNAP benefits are too low.  USDA is examining how the temporary boost in SNAP benefits enacted in 2009 has affected program participants; this research should help to inform a debate about how best to improve benefit levels permanently.
  • Reevaluate SNAP’s harsh treatment of childless adults. SNAP requires most unemployed childless adults to participate in at least 20 hours per week in a limited set of work activities or else lose SNAP benefits after just three months.  States, however, are not required to provide these individuals with a qualifying work slot.  As a result, the work requirement is a de facto time-limit on food assistance for unemployed people.

    Congress wisely suspended this requirement during the recession, and states have the flexibility to waive it for areas of high unemployment.  Soon, however, this harsh rule will return in large parts of the country.  Congress should reevaluate it and ensure that poor unemployed workers who are willing to work can obtain needed food assistance.

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  • Examine ways to further reduce errors and fraud. SNAP error rates have fallen steadily in recent years and are now at all-time lows.  Only 3 percent of all SNAP benefits represent overpayments, meaning they either went to ineligible households or went to eligible households but in excessive amounts (see graph).  USDA has also cut “trafficking” — the sale of SNAP benefits for cash, which violates federal law — by three-quarters over the past 15 years.  Still, policymakers should look for ways to make further improvements, such as new investments in technology and business practices that can reduce waste without compromising eligible people’s access to benefits. 
Stacy Dean

Vice President for Food Assistance Policy