Cutting food assistance is not just morally wrong — it’s bad economics

By William Spriggs

Guest Commentator

The U.S. Gross Domestic Product (the value of all goods and services in the economy) figures show GDP per person is $53,211. That’s per person, not per family. Those figures also show we annually spend $2,797 per person on food — that’s $233 per person a month. After netting out imports, we sell nearly $14 billion in food overseas. Clearly America is a wealthy nation that is fully food secure.

So the issue is not America’s resources of income and land, it is our choices in the distribution of our resources. Presumably, this value proposition was settled when President Lyndon B. Johnson signed the 1964 Food Stamp Act into law, with support from the labor movement.

To be eligible for the Supplemental Nutrition Assistance Program (SNAP), a family must have a total income (including any other federal assistance) that is less than 130 percent of the poverty line (except in six states with limits up to twice the poverty level). For a family of two adults and one child, that means income below $25,389 a year.

The maximum benefit for a family of three fell from $526 to $497 a month on Nov. 1. Low-income families tend to be either old or young. And young families happen to be where most of America’s children live. So, there are some 21 million children who currently are fed, in part, by SNAP benefits. That is almost one in four U.S. children.

In 2009, when Congress passed the American Recovery and Reinvestment Act, it boosted the maximum SNAP benefit to help families during the worst labor market since the Great Depression. But that boost was set to expire at the end of October 2013, in hopes the labor market would have recovered.

The labor market has not recovered. There are still 1.5 million fewer payroll positions in America today than in January 2008. This means that unemployment is real; it is not the result of people being lazy in looking for work.

And young people-in particular have been hit hardest. Among the key age groups for young parents, the share of 20- to 24-year-olds who are employed is at 61.8 percent, down from 69.3 percent in January 2008. For those 25 to 34, the share holding down jobs has fallen to 74.6 percent, down from 79.6 percent in January 2008.

House Republicans have voted to cut SNAP, shifting the blame for the weak economy onto young workers and the weight of the costs on our children by ignoring policymakers’ failures to get the economy running. In a nation so rich it can export food, this is morally wrong.

Rather than pass plans to hire teachers to restore our children’s classroom sizes, or hire construction workers to fix our broken roads and bridges, Republicans argue it is better to cut federal spending on things like SNAP to get the federal budget in order. Some Republicans think federal deficits are morally wrong because deficits leave bills for our children.

These same Republicans fought President Barack Obama hard to keep tax cuts in place for the wealthiest people on the planet, ignoring that those tax cuts make the federal deficit larger. And no moral calculus says we should starve our children of food and education today to save them as weaklings for the future.

This is more than morally wrong. It is bad economics. The Consumer Expenditure Survey gives a deep view of America’s consumption patterns. An interesting fact in that data is that among families in the income range to qualify for SNAP, they all consume on average $20,000 to $25,000 a year.

This makes sense, as it would be hard to imagine how someone could eat, be clothed and have shelter and not spend at least $20,000 a year. This means at that income level, they do not save, they spend every dollar. Cuts in their SNAP benefits mean they will have to cut something else to continue eating.

This is not a cut simply to families struggling with an economy that is not producing enough jobs and wages that are barely keeping pace with inflation. It means pulling millions of dollars out of the economy. This means less sales revenue for small businesses selling clothes or shoes or children’s books. And fewer buyers mean less need for sales clerks, meaning fewer jobs.

The current economic policies of lowering the deficit by half, boosting corporate profits to record highs, and breaking Dow Jones average records for stocks has not meant relief on Main Street, Martin Luther King Jr. Boulevard or César Chávez Way. We need to strengthen policies that help everyone.

William Spriggs serves as chief economist to the AFL-CIO. Follow him on Twitter: @WSpriggs.