Does slicing $8 billion from food stamps cut to bone or just trim some flab (+video)

Congress's newly approved farm bill cuts $8 billion from food stamps over a decade, barely 1 percent a year. Low-income households in 16 states will feel the effect the most. Why is that (and answers to other FAQs)?

By , Staff writer

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    Michael Adams, 13, (r.) hands off a buddy pack to volunteer Allyssa Morse as he and other members of the Shaw-Harg 4-H club fill the bags, which help feed school children, Saturday, Jan. 25, 2014, at The Food Bank for Central & Northeast Missouri. The farm bill that Congress approved on Tuesday contains a controversial $8 billion cut in the food stamp program that millions of Americans rely on as a defense against hunger.
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The farm bill that Congress approved on Tuesday contains a controversial $8 billion cut in the food stamp program that millions of Americans rely on as a defense against hunger.

Many Democrats oppose the measure, arguing the cut is too steep and will hurt about 1.7 million of the neediest Americans.

Republicans have the opposite concern: Many say the bill doesn't make large enough cuts to an entitlement program that needs reform after doubling in size since 2007.

Recommended: How much do you know about US entitlement programs? Take our quiz.

What’s the reality?

A considerable weight of economic evidence contradicts the notion that the Supplemental Nutrition Assistance Program, or SNAP (long known as food stamps), is a runaway entitlement that’s wasting vast taxpayer dollars.

At the same time, the idea that $8 billion in cuts are an anti-poor travesty, or that other conservative reform ideas should be dismissed out of hand, also appears to be a partisan stretch.

Within this huge program, which currently costs about $80 billion a year, is some fraud to be rooted out. And with a record 1 in 6 Americans receiving food stamp benefits, there’s room for healthy debate about whether eligibility standards should be reframed to ensure that only the truly needy are enrolled.

The large majority of SNAP dollars, however, are meeting their intended goal of alleviating hunger and malnutrition, many policy experts say.

Here are answers to some frequently asked questions regarding food stamps and the new farm bill:

How big is this cut, and who will it affect?

The reduction in overall food stamp spending is relatively small, and it won't cut anyone entirely off from aid. The $8 billion cut is to be spread over 10 years, which means it’s not much more than 1 percent of projected food stamp spending over that time.

Still, the shift falls heavily on a narrow pool of recipients – some 850,000 households, or about 1.7 million people.

The farm bill removes a provision that allows recipients to qualify for stepped-up food aid if they also get federally funded home heating assistance. Some 16 states plus the District of Columbia have used this "heat and eat" option – often granting a token $1 per year in heating assistance so that a household can receive a higher food-stamp payment each month.

By removing "heat and eat," the farm bill reduces food budgets for affected households by about $90 per month on average. That's a significant hit to low-income families.

Proponents of the shift say it will put recipients in various circumstances and locales on a more level playing field for benefits, without breaking the program's intended safety net. Even some antihunger advocates say they aren't arguing with the premise behind the change.

"We understand that there has to be reform to the system," says Kevin Hagan, CEO of the nonprofit group Feed the Children, a national food-aid charity based in Oklahoma City.

He isn't happy about food stamp budget cuts, but he says the $8 billion paring is a small price compared with some $40 billion in 10-year cuts that many House Republicans backed – and that passage of the farm bill will provide some certainty in the food-aid landscape for several years and election cycles ahead. 

Why do proponents say this cut is needed?

The $8 billion cut, like other proposed reforms, is backed by lawmakers who want to curb the federal budget deficit, eliminate what they see as unfair or wasteful practices within the food stamp program, and wean Americans from what they see as a dependency culture rooted in liberal policies.

How fast has the growth of food stamps been?

Spending and enrollment surged after 2007 as the United States entered recession, but they weren't growing unusually fast before then.

From 1980 through 2007, the compound annual growth of food stamp spending was about 1.35 percent per year (after adjusting for inflation), not much above population growth of 1.06 percent a year during that time.

Some other entitlement programs, notably Medicaid, have been growing faster.

Food-stamp benefits are modest on a per-person basis, but they’ve been expanding. The average recipient got $97 a month in 1980 and $133 in 2013 (after adjusting for inflation).

The biggest change is that, since 2007, food stamp enrollment has surged from about 26.3 million people to 47.6 million last year, according to Agriculture Department figures. Spending on the program has more than doubled during that time.

Moreover, enrollment has kept rising during the past few years, even as a slowly recovering economy has seen unemployment fall substantially from its 2009 peak.

Why the enrollment surge? Are millions more Americans mooching off Uncle Sam?

The overriding explanation is the recession and its aftermath, mainstream policy experts say. Enrollment should fall as the job market improves, they add.

The nonpartisan Congressional Budget Office, for instance, concluded that the enrollment “increase was driven primarily by the weak economy.” Enrollment will decline to near prerecession levels by 2022 (to about 11 percent of the population, versus 15 percent today and 9 percent before the recession), the CBO projects.

It’s not unheard of for food-stamps enrollment to keep rising for several years after a recession ends. That happened in the early 1990s, for example, and the latest recession was a severe one.

The economic dip also affected SNAP’s spending per beneficiary, by the way, not just the number of recipients. Lower incomes and rising food costs have pushed benefits upward, the CBO analysis notes, and Congress included a temporary boost in SNAP benefits (which expired near the end of 2013) in its broader policies to revive the economy.

Some conservative economists say the economy isn’t the whole story behind surging food stamp enrollment. The surge also is a result of changed state and federal guidelines that make it easier for people to quality for benefits, and of outreach efforts that include federal "performance bonuses" for state agencies that sign up more people.

To many on the political right, those trends represent a baneful expansion of the welfare state. Many liberals, meanwhile, view these changes as justifiable efforts to extend the safety net to more Americans whom the recovery has left behind.

Are food stamps a federal budget buster?

Food stamps amount to about 2.2 percent of some $3.6 trillion in total federal spending in the 2014 fiscal year now under way. That makes the program less meaningful to federal deficits than, say, the larger entitlements (Medicare, Medicaid, Social Security) or tax policy.

But as federal programs go, food stamps, with its projected $764 billion in spending over 10 years, is still pretty big. The CBO says some Republican-backed reforms might shave another $40 billion or so in costs from the program over 10 years. That’s not peanuts. But, for a sobering comparison, federal deficits are projected to total $6.3 trillion over that time.

Does the new farm bill represent meaningful reform?

Supporters of the $8 billion cut say it saves money and makes the program more fair. But they'd like to see bigger steps.

Food stamp critics say tighter eligibility could stop states from enrolling some people without confirming that they meet a test for income and assets at or near poverty level. Some conservatives would like to see food stamps removed from the farm bill, arguing that the more logical home for social-welfare programs is under the Department of Health and Human Services.

Mr. Hagan of Feed the Children says the need for reform shouldn’t be overplayed. He says most of the unemployed recipients he talks to “desperately want to get back to work.”

Hagan says a middle-ground goal could best help the many Americans, including children, who don’t have enough food: Maintain a strong safety net, but focus legislation on how to build "ladders out of poverty instead of lines to a food bank."

That’s not an easy task. But it’s one he hopes that conservatives and liberals alike can agree to pursue, and that his nonprofit organization can work toward, too.

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