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May 20, 2005

 

WHY FOOD STAMPS MATTER: TALKING POINTS

There are millions of hungry Americans.

  • In 2003, the last year for which there are official USDA data, 36.2 million (or 11.2% of) Americans lived in households unable to purchase adequate food, up from 34.9 million hungry Americans in 2002.

  • Over one-third of those in hungry and food insecure households (13.3 million in 2003) are children. This is almost one-fifth of all American children.

  • Hunger has adverse consequences for all Americans, but particularly for children and mothers. It impedes growth and development, is a significant predictor of adverse health conditions, and is associated with behavior problems among preschoolers and school-age children.

  • The Food Stamp Program currently reaches only about one-half of eligible low-income working families.

Food Stamps are effective, efficient and closely monitored.

  • The Food Stamp Program is efficiently targeted to reach people who have the most difficulty affording an adequate diet. Over 95 percent of benefits go to households with incomes below the poverty level; nearly all of the remaining beneficiaries are elderly or disabled.

  • A full-time minimum wage worker earns the equivalent of just under half of the poverty level for a family of four. Even with the earned income tax credit (EITC), this family’s income is only about 70 percent of poverty. Food stamps make it possible for such working poor families to stretch their income so that it approaches the poverty level.

  • Food stamp benefits are provided in the form of an electronic benefit card that can be used in supermarket checkout lines only for the purchase of food.

  • Food stamp error rates (overpayments and underpayments) have declined for 6 consecutive years and are at an all-time low, which is an extraordinary accomplishment for a program administered by thousands of eligibility workers in state and local offices across the country.

  • Changes to the Food Stamp Program that reduce eligibility or benefits cannot be adequately replaced by food banks and other private charities, or by local communities suffering the loss of local jobs. These agencies are already struggling to meet growing demands driven by long-term unemployment, falling wages, and rising fuel prices.

Food Stamps benefit farmers, the food industry, and the economy.

  • USDA’s Economic Research Service (ERS) estimates that each $1 billion of retail demand by food stamps generates $340 million in farm production, $110 million in farm value-added, and 3,300 farm jobs; and each $5 of food stamps generates almost $10 in total economic activity.

  • Changes in food stamp policy have significant impacts on economic activity and household income across the economy, according to an ERS study finding that hypothetical cuts in food stamp benefits reduce food demand and farm production.

  • Food stamp participation closely follows the economic cycle. With few exceptions (notably 1981-1983 following substantial program cutbacks) food stamp caseloads have closely tracked the unemployment rate, rising as unemployment rises, and falling when it declines.

  • Paired with unemployment insurance, food stamps are a vital part of America’s front-line defense against recession. They help to prevent hunger in families with laid-off workers that fall into poverty, provide temporary support until these families can get back on their feet, and quickly get federal support into local communities when times are tough.

  • During the late 1990’s food stamp participation fell by 40 percent, largely because of a strong economy and declining unemployment. Participation rose with the economic downturn beginning in 2001 and the program now serves nearly 8 million more people.

The Food Stamp Program helps individuals and communities hit by disasters.

  • When natural or man-made disasters hit, the Food Stamp Program provides timely, critical resources to help people cope, and is an important ingredient for physical and economic recovery.

Food Stamps make work pay and help those seeking economic independence.

  • Food stamps help low-wage workers make ends meet and assure that families are financially better off working than on welfare. A typical person leaving the welfare rolls, working 35 hours per week at $6.50 per hour, is eligible for about $200 a month in food stamps for a family of three.

  • Food stamps promote self-sufficiency. For every additional dollar a food stamp recipient earns, his or her benefits decline by 24-36 cents, thus providing a strong incentive to work longer hours and search for better employment opportunities.

  • Over half of all food stamp recipients are children and another quarter are elderly or disabled persons. Of the remainder, close to half are working or participating in the Food Stamp Employment and Training program or are subject to other program work requirements (e.g., TANF). Of the 5 percent of all food stamp recipients neither working nor subject to a work requirement, half are caring for a young child.

Food Stamp provisions in the 2002 Farm Bill are working.

  • The 2002 farm bill food stamp provisions offered states an array of new options to simplify the program, make it more accessible, and better coordinate child care and Medicaid for eligible families. Program changes that add unwarranted complexity and excessive bureaucratic conditions on food stamp administrators and beneficiaries would undermine these advances.

  • In recent years, the Administration, Congress, states, and advocates have made reaching more food stamp eligibles a top program priority. Changes that reduce eligibility and benefits for low-income families or add unnecessary administrative burdens to the program will weaken such efforts.

  • The current farm bill Food Stamp Program authorization provided stable policies and predictable rules for the operation and administration of the program through 2007. Early reopening of these provisions risks undermining state plans and cost-effective operation of the program.

Source: America’s Second Harvest - The Nation’s Food Bank Network (www.secondharvest.org); Food Research Action Center (www.frac.org); Center on Budget and Policy Priorities (www.cbpp.org); 5/19/05.

 

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