Hunger as an Incentive: The Shameful Assault on SNAP

The anticipated assault on the most vulnerable citizens in the wake of the tax cut bill is moving forward.

This week the administration ratcheted up the pressure on the Supplemental Nutritional Assistance Program (SNAP), colloquially referenced as “food stamps.”

The attention-grabbing dimension of the proposal – the idea of sending impoverished households “harvest boxes” rather than providing cards loaded with electronic cash to allow people to make their own food choices – would be laughable were it not so frightening in its disregard for human dignity. The proposal recalls passages from George Orwell’s The Road to Wigan Pier, his study of the unspeakable deprivation of working class Yorkshire and Lancashire during the Great Depression.

Toward the end of the book, Orwell details submissions to newspapers and magazines suggesting the ideal weekly budget for food, extracting the maximal nutritional value out of the most meager sum. A menu he cites “contains nothing for fuel,” which the writer cannot afford, consuming all his food raw. As Orwell observes, “When you are unemployed, which is to say when you are underfed, harassed, bored and miserable, you don’t want to eat dull wholesome food.” His point is that the notion that it is reasonable to impose on the poor a diet that squeezes the maximal nutritional value out of the minimal budget abstracts from the experience of poverty – and from humanity.

A century before Orwell’s book, the utilitarian era ushered in Victorian poor laws, reducing costs of aiding the poor by committing them to workhouses and shifting the blame for poverty to the poor themselves. Jeremy Bentham, the founder of the utilitarian movement, operated from the fundamental assumption that individuals, dominated by the pursuit of pleasure, will shirk to the extent they can. As Bentham put it in his Principles of the Civil Code, “The law which offers to poverty an assistance independent of industry, is, so to speak, a law against industry itself.”

Building on this theme, Nassau Senior, the British political economist, wrote in his 1834 Poor Law Commissioner’s Report that “The most pressing of the evils of which we have described are those connected with the relief of the Able-bodied.” As a corrective to this evil, aid could be afforded, but only “under strict regulations.” In short, there was a case for relieving indigence – that is, the state in which the individual falls below subsistence – but not for the relief of poverty. Assistance therefore could be administered sufficient to move the individual from starvation to poverty – but not above.

In short, “Every penny bestowed, that tends to render the condition of the pauper more eligible than that of the independent labourer, is a bounty on indolence and vice.” Since existing poor laws tended to lift living standards to those of the poorest laborers, they were wasteful and could be rendered less damaging by “the restoration of the pauper to a position below that of the independent labourer.”

But why are conservatives intent on taking us back two centuries in the development of social welfare policy? As the tax cut bill shows, the current administration and Congressional majority act on the assumption that there is a direct correlation between wealth and virtue. The benefit of such a philosophy is that it justifies measures such as tax cuts for the richest. Within this logic, taxes become a punishment imposed on the wealthy; social welfare benefits a reward for sloth.

The fact is that food stamp rolls and spending have been trending down (a reduction of more than 5 million people) during the past couple of years from the peak (of 47.6 million people) reached during and after the 2008-9 financial crisis. The rise in SNAP participants during the economic contraction and subsequent reduction in numbers shows the program functioning precisely as is designed to do.

Benefits are modest, averaging $254 per month per household, and make a huge marginal difference for the food security of 1 in 7 U.S. citizens. According to the Urban Institute, SNAP benefits moved more than 8 million people out of poverty in 2015, and reduced by half the number of children living in deep poverty (i.e., at less than half the federal poverty level).

Furthermore, the program is administratively efficient, with 93 percent of funds going directly to households for food spending.

The program supports families in urban and rural areas in every state, and it has a substantial economic multiplier effect, with every dollar of benefits generating $1.79 of economic activity.

Although most SNAP households have earnings from work, the administration proposes imposing stricter work requirements as part of a proposal to slash $213.5 billion from the program over the next decade. The cuts represent a policy in search of a problem, since only a tiny fraction — 6.8% — of Americans using food stamps are able bodied adults without dependents who are not employed.

The pending proposal from the US Department of Agriculture seeks to remove waivers from employment requirements previously established for higher unemployment localities. But there is little evidence of a deterrent effect of SNAP benefits on employment. In fact, by all accounts able-bodied recipients of SNAP benefits who do not work tend either to be looking for work and unable to find it, or face other barriers to employment, such as a lack of basic job skills. Not all areas served by SNAP have qualified education and training programs, precisely the sort of reality acknowledged by the current waiver program. As argued by the Center on Budget and Policy Priorities,able bodied individuals working less than 20 hours weekly receive about $5 per day in benefits, and likely would not lose these benefits even if they could find work for more hours – further evidence that there is little relationship between work requirements and benefit claims.

Finally, money invested in lifting people across the margins of poverty can preempt the costs of “diseases of despair,” including homelessness, depression and associated health problems. But as we saw in last week’s blog post the current administration and Congress will only invest in their own political fortunes.

spondi-restaurant-athens.jpgBy the way, my new restaurant is thriving. However, I’ve decided to suspend our program of donating leftover food to the local food pantry. I originally thought we might be helping to feed some of the many hungry people in the state of Oklahoma. I realize now that that donated food is simply pushing up the unemployment rate.  I’m sorry for my earlier confusion.

The Administration’s Investment in Social Division

We witnessed a stunning irony this past week: a rebellion against the Republican tax cut by its greatest beneficiaries. This came in the form of a stock selloff as evidence materialized that the tax cut and a budget agreement in Congress would together propel budget deficits past $1 trillion from fiscal year 2019 onwards.

Deficits of this magnitude represent a return to fiscal conditions during the 2008/9 financial crisis – except that the economy is now growing steadily rather than contracting and the spike in deficits comes on top of an accumulation of federal debt attributable to the financial crisis itself. Massive deficits were warranted in the aftermath of the financial crisis; they make no economic sense today. However, they may prove politically useful for the current administration and the Congressional majority.

In response to rising deficits of their own creation, Republicans are now primed to follow up their massively lopsided tax cuts with their well-rehearsed mantra: “we have a spending problem.”

This message is designed to lay the groundwork for cuts to social welfare spending. For anyone genuinely concerned with deficits and debt, the exclusive focus on one side of the budget ledger (spending) while ignoring the other (revenue) is entirely dishonest. Nonetheless, the catchphrase has also been deployed at the state level in places such as Kansas  and Montana.

Purveyors of this rhetorical trick turn their critical attention to growth in mandatory spending for Social Security, Medicare and such items as “food stamps” (the Supplemental Nutritional Assistance Program, or SNAP); we should fully expect an assault on these and other programs that benefit vulnerable populations.

Even before the tax cut, U.S. federal tax revenue relative to GDP was low both by historical standards and in international comparison. If 2017 tax revenue was simply equal to the average share of GDP for the past 40 years, there would have been an additional $62 billion of tax revenue. If we exclude the historically low revenue years of the financial crisis – 2009 and 2010 – the implied loss of federal revenue is $91 billion. By itself, this would pay for a full year of the Supplemental Nutritional Assistance Program, which assists about 43 million Americans living on the edge of poverty to stave off hunger.

Even more stark is the share of U.S. tax revenue in international comparison. In 2016, tax revenue from all levels of government was 26% of GDP in the U.S., versus an average of 34.3% for all 35 Organization for Economic Cooperation and Development (OECD) countries. Of these countries, the U.S. ranks 31st. Only Turkey, Ireland, Chile and Mexico raise smaller shares of revenue relative to GDP.

Why the higher tax revenue in most wealthy countries, especially European democracies? Do citizens in these countries simply enjoy paying taxes more than Americans?  Of course not. But these countries invest in social cohesion, which is why even center-right political parties, such as Germany’s Christian Democrats, have long supported sustained social welfare spending. U.S. governments do not make this investment. Instead, American society operates under the myth that social cohesion will emerge from the inclusiveness of the “American Dream.” That myth has been shattered, and American society is in desperate need of renewed investment in social cohesion.

That investment is not forthcoming. Instead, the deficits conjured by the current administration and the Republican Congress will serve as a pretext for an assault on social welfare spending. The most vulnerable will pay the price.

Worse, divisiveness has become a conscious political weapon of the current administration and congressional majority. In their hands, the U.S. government is no longer investing in the long-term future of American economy and society; it is investing in social division.