Seven Reasons to Reform Food Stamps

T. Elliot Gaiser / July 04, 2013

Newscom

Food stamps were a popular topic of conversation last month as Congress debated the farm bill. This decades-old Great Society program is in much need of reform for at least seven reasons:

Food stamp spending has surged. Costs have been climbing since the program began in the 1960s, recession or not. Over roughly the past decade, food stamp spending jumped from $19.8 billion in 2000 to $84.6 billion in 2011.
Food stamp rolls have also been climbing for decades, regardless of the economic situation. Today, food stamp use is at an all-time high, with the most recent data showing that about one in seven people participate in the program. This is a 140 percent increase since 1990.
Government has vastly expanded food stamp eligibility. “Broad-based categorical eligibility,” put in place under the Clinton Administration and heavily pushed by the Obama Administration, loosens income and asset limits. That the number of households receiving food stamps has increased faster than households near the poverty line indicates that changes in food stamp policy helped boost the rolls.
States are spending taxpayer money to “recruit” food stamp participants who might not otherwise choose to use them. From advertisements, aggressive tactics, and enrollment quotas used by recruitment agents, it seems like Uncle Sam wants you on food stamps.
Despite what the left claims, food stamps don’t stimulate the economy. Every dollar spent on food stamps is a dollar that would otherwise be spent elsewhere. Therefore, it simply shuffles resources rather than adding economic growth.
Even in good economic times, many food stamp recipients don’t work. In 2010, among the roughly 10.5 million households receiving food stamps that contained an able-bodied, non-elderly adult, 5.5 million did not perform any work. Of those who did work, 1.5 million to 2 million worked less than 30 hours per week.
Food stamps discourage work and self-sufficiency. “The more income that a person receives when not working, the less is the reward to working,” University of Chicago Professor Casey Mulligan testified before Congress earlier this year. “In such cases, a person might have more resources available to use or save as a consequence of working less.” Because food stamp benefits are reduced by 30 cents for each dollar of net income a recipient earns, the program behaves like an income tax paid by recipients via reduced benefits. Thus, food stamps can often act as a disincentive to work. Mulligan estimates that this disincentive has actually prolonged the weak labor market recovery.

Policymakers should reform food stamps to promote self-sufficiency through work and roll back food stamp spending when employment rates improve. These changes would promote not only fiscal responsibility but, more importantly, personal responsibility and human dignity.