The Trump administration aims to slash spending on the Supplemental Nutrition Assistance Program (SNAP), formerly known as food stamps, by US$193 billion over the next decade. The proposal would also overhaul how the nation’s main nutrition assistance program operates, potentially encouraging additional cuts by the states.
Curbing SNAP’s reach is only one way that Office of Management and Budget Director Mick Mulvaney and other officials are trying to trim the safety net to save taxpayer dollars – while simultaneously boosting military spending.
As an economist who studies nutrition policy, I don’t understand what good the administration thinks it can do by overhauling and paring back an effective and efficient program. By many measures, SNAP successfully satisfies an essential human need and fulfills its mandate to promote the general welfare.
To justify the SNAP cuts, Mulvaney argued that the government wastes money on aiding “able-bodied” people who ought to earn enough money to provide for themselves.
But nearly two-thirds of SNAP participants are children, elderly or disabled and thus are not expected to work. What’s more, 44 percent of the Americans who rely on SNAP benefits live in a household with at least one worker. Among SNAP households with children, 55 percent include at least one employed person. Furthermore, when able-bodied adults who aren’t caring for a dependent qualify for SNAP benefits, they lose them within three months if they aren’t working at least 20 hours a week.
What about saving tax dollars? SNAP uses little federal money. The U.S. is currently spending around $71 billion a year on the program. While this sounds like a lot, it accounts for only around 2 percent of this year’s federal budget. The cuts proposed for the next 10 years would scale the program back by more than a quarter, but even eliminating it entirely would barely make a dent in federal spending.
As for government inefficiency and waste, research indicates that SNAP’s benefits go where they are intended: to the poor. There are inevitable errors in all government programs that mean some people get paid who shouldn’t, and others who should get paid don’t. But the “error rate” for SNAP, at about 3 percent, is much lower than for Medicaid, Medicare, Unemployment Insurance and most other large-scale government programs. “Illegal trafficking,” when SNAP recipients sell their benefits for a reduced amount of cash to food retailers, amounts to only about 1 percent of the program’s total benefits, according to the USDA.
In short, SNAP is an efficient and effective program that helps millions of vulnerable Americans.
Changing SNAP’s structure
To accomplish the SNAP spending reductions, the Trump administration proposes dramatic structural changes, morphing SNAP from a federal program into a federal-state arrangement. Currently the federal government establishes basic eligibility and benefit level standards, but states have some power to alter them. The federal government funds 100 percent of SNAP benefits and shares administration costs with the states.
Under the new proposal, states would be able to change benefit and eligibility standards more. This means SNAP would no longer assure consistent levels of food assistance nationwide.
Of particular importance, the proposal would shift some of the responsibility for funding SNAP benefits to states, requiring them to shoulder 25 percent of the cost. Faced with this substantial new obligation and the requirement to balance their budgets, states would have an incentive to cut SNAP benefits even more.
In addition, the White House wants to cut back on waivers granted to states experiencing high unemployment. These waivers allow childless, able-bodied adults who have worked less than 20 hours per week to receive SNAP benefits beyond the current three-month limit.
What economists say
For example, food insecurity increases the risk of many ailments. Children who don’t get enough to eat are more likely to have anemia, asthma, cognitive problems and behavioral problems. Food-insecure working-age adults report more hypertension and sleeping problems. Seniors who don’t get appropriate nutrition are more likely to experience depression and lose the ability to do basic tasks, such as housework, for themselves. Food assistance for pregnant women is associated with reduced obesity, hypertension and diabetes for their children years after they’re born.
Cutting SNAP, therefore, would probably increase health problems among low-income Americans, and the harm to children can be long-lasting. This doesn’t bode well for national health care costs or for low-income Americans’ ability to support themselves now or in the years to come.
Because of SNAP’s income-based eligibility requirements, its caseloads track the unemployment and poverty rates. For example, the number of Americans qualifying for the program rose considerably during the Great Recession, but now that labor markets are recovering the caseload is declining.
And since SNAP automatically responds to the business cycle, it serves what economists call a countercyclical role. That means the program stimulates local economies and the national economy during economic downturns. Economists estimate that each $5 the government spends on SNAP triggers $9 of economic activity and that every $1 billion in benefits creates roughly 9,000 jobs.
The upshot is that if Congress approves the proposed changes, lots of people would have less to spend on food and thousands of Americans would lose their jobs – mostly people who work in food sales and farming. All Americans could eventually be harmed because the economy as a whole would be more vulnerable during the next downturn.
Some conservatives fear that SNAP may discourage work, but research indicates that SNAP benefits do little to discourage paid work. Most of the nondisabled, working-age adults who get these benefits – 58 percent – work, and even more – 80 percent – are employed the year prior or following receipt. Given that SNAP benefits average just $1.40 per meal per person, they offer a meager incentive to remain unemployed.
Most voters do not seem to share these concerns, as SNAP enjoys broad-based support. One poll found that about 80 percent of respondents – including about two-thirds of Republicans – favored raising benefit levels after being told that someone living alone receives an average of $140 a month and a single mother with one child gets just $253.
Another poll found that 61 percent opposed cutting SNAP by $39 billion over a decade – as Republican lawmakers tried and failed to do in 2013. The $193 billion cut President Donald Trump seeks would be much bigger.
Trump’s proposal only begins the long process of building the budget. Hopefully, Congress will reject these cuts to SNAP.