“The focus on cutting life-saving programs like SNAP as a method to reduce the government debt is disingenuous, at best, and self-serving and cynical at worst. Taxing the rich would be a far more effective way to address the debt.”
Editor’s Note: City Limits, in error, initially published an outdated version of this piece; it has since been updated to include the passage of McCarthy’s plan in the House on Wednesday.
As tensions around the debt ceiling continue to rise, we find ourselves in all too familiar territory where policymakers demonize the poor while claiming to prioritize tackling the issue.
Recently, in a letter to the president and subsequent speech to the New York Stock Exchange, House of Representatives Speaker Kevin McCarthy outlined a plan to address the debt by “limiting spending, saving tax payer money, and growing the economy.” His plan, which passed the house on Wednesday, includes the imposition of new work requirements for participants to access critical programs, such as the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps).
SNAP eligibility rules currently have additional work requirements for those aged 18-49 who are ‘able-bodied’ and do not have children. The bill proposes that those same work requirements apply to individuals aged 18-55, having the potential to take critical food assistance from thousands of New Yorkers. The Congressional Budget Office estimates that expanding the work requirements would cause about 275,000 people each month to lose SNAP benefits on average.
These new rules are being proposed despite research that shows the ineffectiveness of work requirements. Instead of bringing people out of poverty—which would reduce the nation’s debt—the speaker’s proposed changes would only further expound the debt by pushing people deeper into deprivation as they lose access to these critical supports.
As outlined in “Caught in the Gaps,” a report published by FPWA which outlines the pitfalls in New York State’s Cash Assistance program, these requirements are unresponsive to the unique needs or circumstances of individuals and families. Research shows that work requirements prioritize securing an immediate, often low-wage job, and do not improve recipients’ long-term economic stability.
This means that many people find themselves stuck in a destructive churn of poverty bouncing from job to welfare supports and back again. Further, many recipients face barriers to work, or are unable to meet burdensome reporting requirements, with the overall result being coverage loss among eligible recipients without an increase in employment.
Targeting SNAP is especially egregious because the benefits of the program to both participants and the wider economy are well documented.
SNAP is the nation’s most important anti-hunger program. It reduces the overall prevalence of food insecurity by as much as 30 percent, and has been shown to improve health outcomes and lower care costs. Beyond these immediate impacts, it also has a broader impact on the economy. Hunger in the U.S. has been conservatively estimated to cost $160 billion a year, contributing to mental health problems, suicide, poorer general health, and lost productivity. Any potential saving from cutting SNAP benefits to someone is eroded by the increase in food insecurity.
“When policymakers cut SNAP benefits to reduce the federal budget deficit, these ‘savings’ evaporate the first time a former SNAP recipient with diabetes ends up in the hospital after running out of the food needed to manage his condition,” Bread for the World Institute explains in a report on hunger.
Further, the question needs to be asked about the cost of enforcing these work requirements. Given the costly nature of verifying eligibility, processing applications and monitoring compliance, it is unclear whether introducing these new measures would indeed result in savings when a single SNAP recipient receives only $281 a month.
SNAP also has a cascading effect throughout the economy: a study from the USDA found that SNAP benefits are one of the most impactful ways to grow the economy because participants generally spend their benefits soon after receiving them. It found that every dollar in new SNAP benefits increases Gross Domestic Product (GDP) by about $1.50 in a weak economy. Based on this metric, during the peak of the pandemic (FY2020), increases in SNAP expenditures alone added about $27.8 billion to the national economy.
These economic benefits of SNAP during the pandemic were also evident at the individual level. According to a report from the National Grocers Association (NGA), in 2022 SNAP had positive impacts on people far beyond its immediate recipients. It:
- was responsible for nearly 200,000 U.S. grocery industry jobs, with wages totaling more than $6.7 billion;
- led to nearly 45,000 more jobs in agriculture, manufacturing, transportation, municipal services, and other industries; and
- generated more than $1 billion in federal tax receipts and $975 million in state and local tax receipts.
It is particularly important now to consider the economic impact of government spending and taxation decisions, with forecasts predicting lower economic growth, and some economists predicting the U.S. entering a recession in 2023. The important role of government in these times was seen during the worst of the pandemic, where government spending played a significant cushioning role, improving both GDP and lifting people out of poverty. Furthermore, as pointed out by McCarthy, ‘growing the economy’ is one of the primary ways in which debt can be addressed.
These benefits of SNAP are being realized in spite of, not because of, the burdensome eligibility criteria. Eligibility for SNAP is tied to the Federal Poverty Line—an outdated and inadequate measure for capturing how much it truly costs to live in the United States, as documented in FPWA’s brief.
It is based on a methodology developed in the 1960s and has not been adjusted to reflect the ways in which consumption patterns or the standard of living has changed in this time. This means that many people that could benefit from SNAP are currently struggling to make ends meet, often having to make heartbreaking decisions between food, housing, and medical expenses. If anything, access to SNAP needs to be improved, not made more difficult.
Despite these findings, calls to limit eligibility for welfare programs continue to rage. These debates are understandable on one level—tackling the federal debt is important and reducing the nation’s debt burden is vital for continued stability and prosperity over time. However, instead of the speaker trying to balance the federal budget on the backs of the poor by cutting vital and economically productive spending on programs such as SNAP, attention should be turned to the parts of the spending and taxation equation that contribute most to the national debt and are most inefficient for the economy.
At the same time that Speaker McCarthy is advocating to address the government debt, Republicans are also advocating for the extension of tax cuts. These tax cuts are economically inefficient, worsen inequality and are the main contributors to the debt. The tax cuts under the 2017 Tax Cuts and Jobs act passed during the Trump Administration alone are expected to cost approximately $2.3 trillion dollars.
Considering the scale of these tax cuts, the focus on cutting life-saving programs like SNAP as a method to reduce the government debt is disingenuous, at best, and self-serving and cynical at worst. Taxing the rich would be a far more effective way to address the debt.
Looking at the evidence, arguing to reduce the national debt while advocating for tax cuts does not add up, from either an economic, moral, or fiscal perspective. Targeting programs such as SNAP will only have negligible impacts on the government debt. These changes are largely politically motivated, as part of the continual demonization of people who are already constrained by economic hardship and struggling to find the dignity and freedom afforded to the rest of society, including the speaker and his political base.
We champion the calls to save taxpayer money, balance the budget, and grow the economy. But instead of letting flawed political calculations and bias against those struggling in our country hold sway, we urge that Washington base its decisions on the overwhelming economic evidence.
Brad Martin is a senior fiscal policy analyst for FPWA (Federation of Protestant Welfare Agencies), a leading New York anti-poverty nonprofit.