Editor’s Note: Conservatives love to beat up on food stamps. It happened again last week, when Paul Ryan called overhauling the program and converting it into a “block grant.” How does the program actually work? Does it actually need reform? What would happen if conservatives got their way? As part of the QEDecide series, we put those questions to a pair of the nation’s most trusted researchers on the subject: Kathryn Edin from Johns Hopkins University and Luke Shaefer from the University of Michigan. Here’s what they said:
What is the food stamp program and why is it actually called SNAP?
The Supplemental Nutrition Assistance Program, or “SNAP,” the new name for the Food Stamp Program, is America’s largest and most important nutrition assistance program. It provides low-income people with money they must use to purchase food. The modern program was established as part of the War on Poverty in the 1960s, but it has undergone a ton of changes since then. For example, the government now gives recipients electronic debit cards, rather than stamps, for buying food. Those changes are one reason Congress decided in 2008 to rename the program—to signal a fresh start.
If I were eligible for SNAP, how would I get it—and how would I use it?
These days an individual on SNAP with zero net income would get a maximum monthly benefit of $189 per month; for a family of four it’d be $632. The more money you make, the less food assistance you get. But the decline isn’t one-to-one—you lose only about 30 cents for every extra net dollar you earn. If you were on SNAP, you would take your benefits card with you to the grocery store and fill your shopping cart with food just like you always do. When you check out, you’d slide your card through a machine just like a credit or ATM card, enter your pin, and the store would deduct your grocery total from your balance. The only complication is that SNAP doesn’t cover non-food purchases, like diapers or toothpaste. To pay for those, you have to check out a second time and pay cash.
How many people are on SNAP—and how does that compare to the past?
As of March 2014, there were about 46.1 million people in households receiving SNAP. That’s roughly one in every seven people living in the United States. The single largest sub-group of recipients is households with children, although the program also serves working-age adults with no children, as well as the elderly.
Today’s SNAP caseload is quite a bit larger than the rolls have ever been before. The previous peak, of 27 million, was in the early 1990s. The SNAP caseload fell after that, thanks to the booming economy and some new restrictions on eligibility introduced by welfare reform. As of 2000, the total caseload was down to 17.2 million. Do the math and you’ll see that, since that time, the caseload has risen almost 170 percent.
The primary reason SNAP caseloads have swelled is the economy. Recent research has shown that with so many people out of work for so long, many more people needed the help. Of course, the economy has started to improve recently, ever so slowly. Sure enough, SNAP rolls are starting to come back down a little.
Another, albeit less significant factor that’s contributed to the rising SNAP caseload is a set of relatively recent changes to the program, some that made it easier for the working poor in particular to qualify for benefits. Most of these changes didn’t take place under President Obama, they took place under George W. Bush. Among the changes: encouraging states to allow people to stay on the program for longer periods of time, without submitting new evidence of their eligibility. The Bush Administration also encouraged states to conduct outreach campaigns to sign people up, and rolled back some restrictions, on benefits for legal immigrants that were enacted in the 1990s.
How much does the program cost today? And how has that changed over the years?
In 2013, the federal government, which finances every dollar in benefits, paid $76.1 billion in benefits. The feds also split the cost of program administration with the states, and their part came to $3.9 billion that year. In all, then, the federal government spent about $80 billion on the program, with the states chipping in a few billion more.
Wow, that sounds like a lot of people—and a lot of money.
Eighty billion dollars ain’t nothing, that’s for sure. But it’s still a tiny portion of the annual federal budget. In 2013, out of every $100 the federal government spent, a little over $2 went to SNAP. In contrast, about $22 dollars in every $100 went to our major health insurance programs for the poor and elderly (Medicaid, CHIP, and Medicare), and $19 went to defense and international security assistance spending. SNAP’s expensive, but it isn’t busting the federal budget.
What's the evidence that the program is actually helping people?
Assessing SNAP’s effects is actually pretty difficult, because the people getting benefits aren’t just a random portion of the population. It’s people who have opted to be part of it—and, as you can imagine, it’s the group of people having the most trouble getting food. Thus, if you just to compare poor families on SNAP to similarly poor families not on SNAP, you would find that those getting benefits have worse outcomes. That’s the sort of finding that keeps policy researchers like us up all night.
But over the past few years, social scientists have found some solid ways to address these "selection" issues. A number of recent studies using those methods find that SNAP benefits have a big and positive effect on the food security of recipients, making it easier for them to get the food they need. There’s also evidence (by Shaefer) that SNAP allows families to redirect some of the dollars they previously spent on food to other essential household expenses, which can keep them from falling behind on their rent and utilities. Perhaps the most exciting recent study finds that program benefits improve the long-term health outcomes of children.
Our own research finds that SNAP gets to many of the families who need it most. We find that the program reduces the number of households with children in the U.S. living in extreme poverty (at $2 per person, per day or less) by about half. SNAP is a lifeline for families with virtually nothing else. We see this especially in the administrative SNAP data. Starting in 2001, more and more families with children who were receiving SNAP (food stamps) began to report that they had no other source of income to live on—not from work, not from public assistance. By 2006, the number of such families had grown 143 percent from a decade before. By 2011, 1.2 million families on SNAP told eligibility workers they had no other income. The big question is, how are they paying their rent? How are they getting to job interviews?
I've heard there is a lot of waste—is there?
SNAP is actually a pretty efficient program. About 95 percent of all federal dollars spent on the program goes directly into benefits. Even adding in what the states spend, SNAP remains pretty efficient. Imagine if America’s health care system spent that little on administration and overhead! Also, the U.S. Department of Agriculture (USDA), which oversees the program and the states that administer it are very serious about making sure only people who are eligible for the program get it—and that they only get the amount for which they are eligible.
Yeah, but what about fraud? I keep hearing stories about people misuing it. Are they?
As you might imagine, it is hard to get good estimates of fraud. It certainly exists, and can take a lot if different forms. But USDA and the states also take fraud very, very seriously. Families can face big fines and jail time if they are found to have intentionally engaged in fraud. Even if there was an honest mistake (by a state, or an applicant) in determining how much they should be awarded, they can be forced to pay back the overage.
Every few years, USDA conducts audits to try to estimate the prevalence of “trafficking.” This is a kind of fraud where the merchants would ring up, say, $100 in fake groceries, and give the purchaser, say, $60 in cash. Thus, the SNP recipient gets unrestricted cash, while the merchant pockets $40. Over the years, according to the USDA audits, the prevalence of SNAP trafficking has fallen, so that now only about 1.3 percent of benefits are trafficked. This is down from about 3.8 percent in the early 1990s and is likely the result of the switch over to electronic debit cards from paper stamps, as well as USDA’s focus on anti-fraud efforts.
Conservatives and Republicans want to change the program. What do they have in mind?
There have been some efforts in recent years to roll back some of the changes made by President Bush and others that make it easier for families to get SNAP benefits. Other proposals would allow states to drug test SNAP recipients, deny anyone convicted of a violent crime at any point in their life access to the program, impose a work requirement on all working age adult SNAP recipients, and strengthen the one that already exists for able-bodied adults without children. Recently, Paul Ryan suggested a change that would consolidate SNAP with some other programs into a block grant to states, giving them more flexibility on how to spent the money, but at the same time cap federal spending. This would be a radical change that would end SNAP in its current form.
What would happen if they succeeded?
If existing research is correct, then imposing more restrictions on the program will cause people to drop off the rolls, and would increase rates of food insecurity and other material hardship. This increased hardship would be concentrated among families with children, although would affect childless working-age adults and the elderly as well. In a lot of ways, SNAP is the only game in town when a family hits a hard spell of unemployment or experiences a big crisis. Also, historical evidence suggests that when you block grant a program and cap its funding, it can lose its responsiveness to changes in the economy. The funding stays the same unless Congress acts, which sometimes can take awhile. So a program might not be able to serve everyone who applies and is eligible when, say, the unemployment rate spikes and a lot of people need help.
I'm sure the program isn't perfect. What could we do to improve it?
Some exciting programs implemented by some states do things like increase benefits if they are spent at local farmer’s markets or otherwise used for fresh local foods. It would be great to expand these even further, across states, and invest in the infrastructure needed to make them successful. These are good for families, and good for local farmers and local economies.
With so many families surviving on no other income but SNAP, it would be nice somehow to give these families some more flexibility to buy some other essential household goods, like diapers or toothpaste and toothbrushes.
But, in the end, SNAP is a critical foundation of the safety net. It's the closest thing we’ve ever had to a guaranteed minimum income. We have solid evidence that it reduces food insecurity, and improves child health outcomes. It is run efficiently. And for a lot of people, it’s all they’ve got.
So while the economy is still experiencing sluggish growth, perhaps the best thing to do is just not mess with it. SNAP’s not perfect, but on the whole it works, in fact quite well. For the time being, maybe we should just let it do its job.