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With Poverty Still High, Food Stamps Should Be Expanded

Joseph Hines

The Census data released today reinforces that reducing poverty should be a national priority. The headline? From 2010 to 2011 official poverty rate remained flat at 15%. That's better than many analysts expected, but it's still a pressing problem. That's also just one measure. Dylan Matthews at Wonkblog rightly points out that the official metric misses the impact of government programs.

So how are we really doing? 

On the campaign trail, candidates have lambasted the administration, Obama particularly, for the expansion of food stamps, with Newt Gingrich famously mocking President Obama as the "food stamp President." But the evidence suggests that food stamps, or SNAP, have been one of the few bright spots in the administration's record on poverty.

We won't know for sure until November, when the Census will release its alternative measure of poverty that takes it into account, but several studies suggest that food stamps, officially known as SNAP, have been a resounding success in preventing more Americans from falling into poverty.

Between 2000 and 2009, the program reduced the poverty rate by an estimated 4.4 percent. Since the Great Recession, food stamps have kept a million formerly income stable Americans from falling into poverty. And, most staggering of all, the Census numbers suggest that food stamps have kept 2%, or 6 million, of Americans from falling into poverty.

That's huge. SNAP has been successful because it was countercyclical, responding to need with spending. While welfare remained flat during the Great Recession, SNAP enrollment nearly doubled, as it was supposed to. The American Reinvestment and Recovery Act added 13% to food stamp cards immediately

In addition to being humane, food stamps are a smart investment because they have a multiplicative effect. In fact, every dollar spent on food stamps has almost has double the impact on the economy at large. A USDA study found that for "every $5 in new SNAP benefits generates a total of $9.20 in community spending." Their growth bolsters private demand by injecting cash directly into the market.

It'€™s not as if the program is being overused. From 1995 to 2000, enrollment in the program dropped precipitously without a corresponding drop in the rate of poverty. Even during the current recession, in which enrollment doubled, only around 2/3 of eligible recipients took advantage of the program. A report by the Brookings Institution suggests that this is because former welfare recipient are seldom informed that they remain eligible for food stamps. 

Brookings estimates €œ"in a typical month in 2001, 17.3 million people in 7.5 million households received food stamps at an annual cost of $20 billion." With the program's expansion since the recession, it has cost around $75 billion annually. While that is nothing to scoff at, that price is worth paying for an effective social safety net. We spend $700 billion on defense annually.

Food stamps have a compelling purpose (preventing people from starving due to circumstances beyond their control) is narrowly tailored to working families (45% of the recipients are children), and meets need with muscle. The program's success, coupled with the remaining eligible Americans who haven't enrolled, call for the program to be expanded, not cut back. Food stamps were timely and targetted during the worst of the recession, but as long as poverty remains high, they shouldn't be temporary. We're better than that. 

For more context about the nature of poverty today, Demos' interactive visual of the past fifty years of poverty data.