SNAP & Poverty
By Eric Gray, Executive Director
According to the USDA, the average American household spends $909 per
month on groceries. After the recent shutdown and President Trumps
mention of food stamps in his state of the union address, we’re
getting many questions from local media, schools and concerned
citizens about what furloughed federal employees do during a partial
government shut down. With Supplemental Nutrition Assistance Program
(SNAP) benefits having been distributed on January 20 and with no
certainty on whether another distribution will happen, many more
families (1 in 7) receiving assistance are concerned too. About 18%
of the fees paid at our Orlando & Treasure Coast grocery programs come
from SNAP benefits so I thought we should take some time to learn a
little about the program and its relation to poverty.
Fifty-five years ago, had the Federal Government been shut down, a
woman named Isabelle Kelley, of Simsbury, Connecticut would have been
staying home as a furloughed worker. Instead, Kelley played a central
role in shaping food assistance and nutrition programs in the United
States. She helped administer the Special Milk Program for
schoolchildren following the passage of the Agricultural Act of 1954.
Her role grew as the government became more involved in social welfare
policy under President John F. Kennedy’s “New Frontier” efforts in the
early 1960s. Kennedy’s first executive order, the day after his
inauguration, expanded the existing food distribution programs for
families in need. The Agriculture Department named Kelley to a
four-person task force to design and carry out a food stamp program.
What started as a pilot program in eight regions eventually formed the
basis of the Food Stamp Act of 1964. It was signed into law that year,
with President Lyndon B. Johnson calling it “a realistic and
responsible step toward the fuller and wiser use of our agricultural
abundance.” Earlier that year (fifty five years ago last month)
President Johnson launched the War on Poverty at his January 8 State
of the Union address.
Isabelle Kelley was later appointed the first director of the Food
Stamp Division in 1965. She said, “We had a mandate to run a small,
cautious program that would be expanded only slowly, on an absolutely
voluntary basis.” Within five years, the program was serving six
million Americans, with a budget in the hundreds of millions of
dollars. Today the program, now called SNAP (Supplumental Nutrition
Assistance) supports roughly 44.2 million Americans at a cost of $70.9
This past month, the one in seven Floridians receiving an electronic
benefits transfer for use in purchasing grocery food, received their
benefits 11 days early. This distribution will need to last them
through February 28 regardless of whether the Federal Government stays
open. Of greater concern is the possibility of no solution before
March 1 when the next transfer would be scheduled.
In part because net income for American farmers declined 12% from the
previous year (lowest levels since 2002), Congress once again passed
the Farm Bill in December. Eighty percent of the Farm Bill spending
is used for nutritional programs, the largest of which is SNAP.
However, since the bill passed around the same time as the shutdown,
the actions expected from passage have stalled.
For example, USDA publishes a number of reports that are key to
farmers’ marketing and production efforts. USDA recently cancelled
release of both the annual Crop Production report and the most recent
monthly World Supply and Demand Estimates, which contains information
key to understanding world agricultural markets. In addition to
cancelling release of information key to agricultural markets, USDA
has halted the important preliminary work required to implement the
new Farm Bill and has stopped the processing of loan and grant
programs, including the program to help farmers hurt by current trade
policy decisions. Further, the shut-down, if it happens again, could
potentially halt benefits going to millions of people currently
receiving benefits from SNAP, including the food stamp program.
SNAP provides assistance to low-income individuals and families so
they may afford vegetables, fruits, dairy products, meat, poultry,
fish, bread and cereals. Nutritional programs were the most
contentious topic in the Farm Bill. Republicans, with support from
President Trump, wanted to change rules so that able-bodied adults
with no dependents would be required to work, participate in work
training or enroll in educational classes to receive nutritional
assistance. Democrats opposed such changes, preferring current rules.
The federal government already has requirements on food benefits;
namely, that “able-bodied adults without dependents” between 18 and 49
work at least 20 hours a week or engage with a job-training or
volunteer program in order to stay on benefits for longer than three
months over a three-year period. Dozens of adults visit our program
in downtown Orlando to verify their employment with a CareerSource
staff member in an effort to continue their SNAP benefits.
Policy makers concerned about benefit programs prefer work
requirements because they believe that receiving money from the
federal government incentivizes people to avoid work altogether. An
analysis by the Center for Budget Policy and Priorities found that 82
percent of all SNAP households and 87 percent of families with
children that receive SNAP benefits were employed in the same year
they received benefits.
SNAP benefits, if broken down, provide $1.40 per meal assuming three
meals daily for the average recipient. Some organizations have
encouraged people to try the SNAP Challenge and go one full week
spending no more than $29.40 on food.
Forty-nine percent of all SNAP households have children and 20% have a
non-elderly disabled person in the home.
Many of the sharpest criticisms of the SNAP program are related to
fraud. The USDA does have 100 inspectors throughout the country just
monitoring for trafficking or misappropriation of SNAP Fuds.
Trafficking is the selling or converting of SNAP benefits into cash
payments of some type. According to the USDA, 4 cents of every SNAP
dollar issued was misused in the 1990’s. Today that figure is 1 cent
of every dollar with 8 percent of retailers nationwide being cited for
abuse. These are usually smaller establishments as opposed to larger
SNAP benefits were said to be a significant part of the American
Reinvestment and Recovery Act from 2008 to 2013. The USDA reported in
2002 and in 2010 that for every dollar spent on SNAP benefits there
was a positive correlation to economic activity measured through Gross
Domestic Product. In 2002, their estimate was $1.84 in positive
economic activity for each dollar spent and in 2010 their estimate was
$1.79. Mark Zandi at Moody’s Analytics, in a 2008 study, reported
this figure to be $1.73.
There has been robust debate about additional restrictions being
placed on SNAP benefit uses. Currently the funds can only be used for
the purchase of consumable product excluding hot prepared foods or
restaurants. SNAP can also not be used for the purchase of some
household necessities like toilet paper or feminine hygiene products.
While studies do not indicate any differences in consumption patterns
among SNAP beneficiaries and non-beneficiaries, the funds can be used
to purchase items such as soda, candy or high sugar cereals. Funds
cannot be used to purchase Tobacco, Pet Food or Alcohol among other
items. Changes to the restrictions have not occurred because of the
difficulty in monitoring and determining what constitutes healthy food
as well as issues of personal freedoms.
SNAP benefits help complement an individual or family’s budget to buy
nutritious food. An individual receives on average $125 per month,
while a family of four gets $500. Additionally, typical households
receiving SNAP benefits can have no more than $2,250 in the bank to
meet requirements. Average monthly income for a person receiving SNAP
is currently $731 gross.
Poverty levels are the strongest possible correlate for participation
in the SNAP program. Participants must earn 130% of the US Poverty
rate or lower. This would be $1,245 gross per month for an
individual. For comparison, in Florida, an adult qualifies for
Medicaid insurance if they are in a household earning 65% of the US
Poverty level or below.
The ‘poverty line’ is the threshold below which families or
individuals are considered to be lacking the resources to meet the
basic needs for healthy living; having insufficient income to provide
the food, shelter and clothing needed to preserve health. Poverty
among Americans between ages 18–64 has fallen only marginally since
1966, from 10.5% then to 10.1% today. Poverty has significantly fallen
among Americans under 18 years old from 23% in 1964 down to less than
17%, although in Orlando that figure is 28% according to the 2018 US
Census data. The most dramatic decrease in poverty has been among
Americans over 65, falling from 28.5% in 1966 to 10.1% today.
Today, more than 39.7 million (12%) Americans, 2.8 million Floridians
(14%) and 353,000 (15%) Metro Orlando residents, including 168,000
children, are considered to be living in poverty.
No matter your feelings about the SNAP/Food Stamp Program, it is a
large enough program effecting enough people that a little knowledge
can go a long way in forming important decisions.