Patterico's Pontifications

11/28/2009

Hard Times

Filed under: Economics,Obama — DRJ @ 8:12 pm



[Guest post by DRJ]

The New York Times reports one in every eight Americans, and one in every four children, is being fed with assistance from food stamps. This interactive map shows food stamp usage and changes by county.

Food stamps, now known as the Supplemental Nutrition Assistance Program or SNAP, are made available by the States on an ATM-like electonic card accepted at most grocery stores. The SNAP website says the program helps feed 35 million people each month. According to the New York Times article linked above, the number of people using food stamps has risen by approximately 10 million people over the last 2 years and is expanding at a rate of 20,000 per day.

Here is a link to current SNAP data released as of November 2, 2009. Food stamp usage was basically constant at 11.5M households (26M persons) in 2006, but increased to 12.3M households (27.3M persons) by December 2007 and 14.2M households (31.7M persons) by December 2008. The increase was especially noticeable from August 2008 to December 2008, although the footnotes indicate October 2008 included a substantial outlay for SNAP disaster assistance. I assume this was due to the impact of Hurricane Ike on Texas and resulting flooding in the Midwest.

What the New York Times article doesn’t do is show how dramatically the number of SNAP recipients increased since January 2009:

  • January 2009 — 14.5M households; 32.2M persons.
  • February 2009 — 14.6M households; 32.5M persons.
  • March 2009 — 14.9M households; 33.1M persons.
  • April 2009 — 15.2M households; 33.7M persons.
  • May 2009 — 15.5M households; 34.4M persons.
  • June 2009 — 15.9M households; 35.1M persons.
  • July 2009 — 16.2M households; 35.8M persons.
  • August 2009 — 16.5M households; 36.4M persons.
  • Numbers aren’t yet available for September 2009 and October 2009 but the trend is clear.

    Politics aside, this is very bad news for all Americans. I’m glad America provides food stamps to help hungry people but I’d much rather have American jobs so they can feed themselves. People need work, not giveaways, and jobs won’t come back if government’s answer is more regulations and taxes.

    — DRJ

    44 Responses to “Hard Times”

    1. I’m glad America provides food stamps to help hungry people, …

      I’m not so sure I can follow you down that path. It seems to me every time government horns in on charitible territory, the highly efficient private charities get hurt. And taxes and public debt increase, reducing the power of the economy to expand. I’m not sure I can accept the government doing anything in this arena.

      Other than that part of that sentence, I can agree.

      John Hitchcock (3fd153)

    2. Not to be a crank, but food stamps are pathetically easy to get, and are basically legal tender for all sorts of things, besides food. You can get your hair braided, buy drugs, buy fake IDs, etc. with food stamps, if you know where to go. And if childhood obesity is such a concern, why aren’t Food Stamps more heavily regulated?

      KateC (7f3e3d)

    3. I cannot get my head around these numbers. Even with the current 10-11% unemployment among working age people how can one in 4 American children and especially one in 8 adults possibly be on food stamps. Can these numbers be correct?

      elissa (0d7171)

    4. elissa, I made 34k last year, lost my job, couldn’t get unemployment so didn’t make the statistics, currently work for min wage (37.5 hours a week), will only show sub-10k this year. And, no, I never got food stamps this year.

      John Hitchcock (3fd153)

    5. It could be that requirements for the stamps have been lowered. Also, radio ads are blaring almost daily from the government about how they are easy to get, come on down. Just google “expanding food stamps” and you will see it’s a constant expansion of eligibility.

      I can’t believe 10 percent of us are “hungry.”

      Patricia (b05e7f)

    6. By the looks of the map, it’s hard to figure how the Indians ever were able to maintain their existence before the white man came along to provide them with food.

      You’d think the reservations would have learned how to raise cattle and all that. Give me that Indian land and I’ll put it to good use. The “Kelo” supporters should want to put that land in my hands since I can develop commerce with that land that can contribute increased taxes to the government.

      j curtis (5126e4)

    7. I won’t get into the whole “food-stamps used to be a shameful thing” argument, except, I will.

      Because the whole idea of food stamps, and government cheese and milk and all the other old FDR-JFK-LBJ “welfare” programs were designed to help lift people out of poverty while supporting American farmers.

      The key words there are “help lift people out of poverty” and “American farmers.”

      Of course, the original intent is long forgotten.

      The food stamp program has been enormously successful in the sense that everyone is fed. There may be “hungry” people in America, but it is not for wont of trying.

      It also has been successful in lifting people out of poverty and into a systemic reliance on government programs with no incentive to succeed on one’s own merits.

      Ag80 (3d1543)

    8. There is a problem that Obama and the Democrats will eventually run into. If everyone is working for the government, or living off it as with food stamps, they will run out of other people’s money. They could, conceivably, go to a 100% tax rate and that would work for a while but that doesn’t account for ACORN and other Obama stalwarts who will still have to get their graft.

      Tough problem.

      Mike K (addb13)

    9. Funny you should speak of farm programs. That’s where another expansion has been enacted: Hungry Seniors?.

      Patricia (b05e7f)

    10. The first time I saw someone using Food Stamps I saw them buying a cake.

      Alta Bob (e8af2b)

    11. I’m not so sure I can follow you down that path. It seems to me every time government horns in on charitible territory, the highly efficient private charities get hurt. And taxes and public debt increase, reducing the power of the economy to expand. I’m not sure I can accept the government doing anything in this arena.

      This is one area where most governments have decided that it’s better to be seen as the safety net in order to help maintain a semblance of order. People have to eat, and as the French found out, hungry people can cause major upheavals that don’t always turn out well. Yeah, it’s basically a bribe to keep the proles from creating instability, but it’s a relatively simple and pragmatic one to make (any politician who says it’s being done out of “compassion” is lying, plain and simple). Short of a complete societal collapse, it’s not ever going to go back to the days of just non-profits, neighborhood organizations, and private charities covering the bulk of food distribution needs for the poor; the government has too much at stake with it’s own survival to make sure photos of the Depression-era “soup lines” don’t crop up again.

      A real problem, which Kate brought up, is that food stamps can be basically used as scrip for good and services other than food. Perhaps getting rid of the ATM card (which makes the above fraud easier) and going back to paper would alleviate this a bit since the cashier would have physical contact with the stamps.

      The food stamp numbers are troubling, and if nothing else, they’re an indication that the economy is in fact NOT recovering despite a lot of the happytalk coming out of the MSM to keep the stock market soaring. What’s even more troubling, though, is the fact that Congress is having to make yet another extension of unemployment benefits; it shows that the jobs just aren’t there. This is basically welfare, even though it’s not being labeled as such.

      I don’t necessarily have a problem with UE bennies being extended because as I said, the jobs just aren’t there. An economy that’s 70% consumer-based, in a recession brought about by excessive debt across all economic sectors, simply won’t have the available jobs to hire everyone that’s lost work. That ends up putting strain on everyone else.

      It would be nice, with all of Obama’s rhetoric about “service,” if receiving unemployment was contingent on doing 10-20 hours a week doing community service of some type (cleaning a highway, working at a library or museum, helping at a soup kitchen, etc.), as opposed to sitting around, pumping out resumes, and waiting for someone to hire you.

      Another Chris (470967)

    12. I thought at the grocery store only some items were approved for food stamps, I’m not sure how they get used in beauty parlors, etc., unless it is that people trade their cards for something, and the receiver of the card uses it? It seems some of those items could be addressed without throwing the baby out with the bath water.

      I think we probably all agree we want people to be able to eat, but all share the concern of unintended consequences with big government programs.

      A few years ago I had a friend who had a full-time job as a Philly teacher whose family got foodstamps, in retrospect not only did they have several kids, but his wife was pregnant, that probably put them in a special category.

      MD in Philly (227f9c)

    13. MD in Philly,

      You need unscrupulous food sellers. For example, they ring up a $2.00 loaf of bread on the SNAP card, give you a dollar, and keep the bread. Same thing when the food stamps were paper. Street dealers would buy them off the recipients for fifty cents on the dollar but would still need to take them to food seller, in cahoots with them, who could redeem them from the USDA.

      It’s a cottage industry, some get audited and caught, but it’s very hard to police every food store in the country.

      nk (df76d4)

    14. Food Stamps and corresponding tax evasion in the NY Metropolitan Area has created more BODEGA millionaires than any Gov.t Program I have ever known ….. Dade County FL is filled with its beneficiary retirees.

      I remember thousands of Colt 45 and Newports bought on food stamps at $0.50 to the Dollar of Food Stamp.

      Great program$$$$ for Ghettopreneur.

      HeavenSent (01a566)

    15. They mostly get caught when they fool around with liquor and cigarettes because local authorities keep close track of them along the distributorship chain in order to collect their taxes — $1.50 per pack of cigarettes in Cook County for example.

      nk (df76d4)

    16. OT, but the distribution of ready-made cigarettes, worldwide, is a fascinating example of successful totalitarianism through cooperation between government and business.

      nk (df76d4)

    17. Because food stamps aren’t earned most recipients aren’t concerned about how far a dollar goes. Most of the time they opt for the choice cuts of meat and the name-brand stuff. The things that I can only afford on occasion. If there were a food stamp redemption center, one that stocked only generic items, the cost of this program would certainly decrease. But alas, thestigma that would go along with having to go to the “food stamp store” would be too much for second and third generation entitlement recipients.

      PatriotRider (1729de)

    18. I view the huge populations of vermin animals such as pigeons and rats as proof that there aren’t that many people in the US who are truly starving.

      There is even plenty of evidence that a subsistence diet is healthier than chronic over-abundance.

      Soronel Haetir (2b4c2b)

    19. “… government’s answer is more regulations and taxes.”

      Isn’t that always the answer to any problem?

      The Food Stamp Program was devised to deal with two problems: Urban riots (thought to be contributed to by poverty and malnourishment, though most of the upheaval of the sixties was due to some serious civil-rights abuses), and a need to lock-down the farm-vote. Ergo, the FSP was ensconced into the DeptAg budget to permanently wed the urban-ghetto and farm-community vote to the Dem Party. Each end of the pipeline gave political cover and support to the other.

      BTW, the “atm-like” card was devised as a solution for the problem of the scrip being used as currency. But, this being America and American’s are nothing if not ingenuous in the face of a problem, those in the community who could, soon figured out a work-around so that the gravy-train could continue. And so it shall always be.

      There is only one way to end the abuses that are enherent in the program, both at the provider (farm) end, and at the user (consumer) end:
      End The Program!

      But then, what would all of those bureaucrats do –
      and without the Food Stamp Program, there is no need for a DeptAg office in every county in America
      (Seen any farms in Manhattan County lately, or San Francisco County?).

      AD - RtR/OS! (27348e)

    20. Another Chris,
      Maybe the jobs would be “there” if the government stopped (1) sucking all the capital out of the economy so businesses could grow and (2) keeping people dumb by poor education or dependent with limitless benefits.

      Patricia (b05e7f)

    21. Great program$$$$ for Ghettopreneur
      Comment by PatriotRider — 11/29/2009 @ 6:52 am

      Did you read the entire NY Times story? The increases in numbers of recipients reflects the doubling of unemployment numbers. Several examples of people you would probably like to have as a neighbor in the article affected by the recession.

      http://www.google.com/hostednews/ap/article/ALeqM5ixfEq7v2AY7LvkVrjo6ZRwo08GZQD9C8D1V00

      is a similar story of seniors who can’t qualify for assistance but are increasingly dependent on food banks because their savings/investments have been hurt badly.

      Totally agree more jobs helps take these numbers down significantly but if we are to survive as a country people have to acknnowledge that they have some ownership and be willing to pay some taxes to get us out of this. Ditto entitlement recipients: Do mil vets and seniors have the will to accept some cap on their incomes (i.e. 5 year freeze on cola increases)? Do politicians have the will to cap unemployment bennies for 5 years and commit to zero deficit spending for 10 years?

      http://www.newsweek.com/id/224694/page/1 paints a gloomy scenario of where the country is headed.

      According to the CBO, a significant decline in the relative share of national security in the federal budget is already baked into the cake. On the Pentagon’s present plan, defense spending is set to fall from above 4 percent now to 3.2 percent of GDP in 2015 and to 2.6 percent of GDP by 2028.

      voiceofreason2 (2f73b8)

    22. vor2, I won’t be attaching mil vets to welfare recipients any time soon. Mil vets earned what they get. Welfare recipients, not so much.

      John Hitchcock (3fd153)

    23. Comment by John Hitchcock — 11/29/2009 @ 8:23 am

      the point is about shared sacrifice to see the country get better, not equating one group with another. To fix the economy long term you have to look at entitlement outlays. Exempting all entitlements speeds up the fiscal collapse.
      Freezes on colas are an example of how people share a sacrifice.

      voiceofreason2 (2f73b8)

    24. The best food stamp racket involves at least two stores. One in a food stamp area and one in a cash area. You send a truck from your Bodega Habanera to Halsted Street and fill it with fresh foods. You pay cash. Only the invoice comes back to your store. The truck goes to your brother-in-law’s Krakow Fresh Food Market. He pays cash at 80%. He does not want an invoice. He will sell it in his store for cash which will not be rung up on the cash register.

      When the USDA comes to your store you say, “I I bought a truckload of food, here’s my invoice, and sold a truckload of food. What’s the problem? High mark-up? This is a high risk area.”

      When the IRS goes to your brother-in-law’s he will say, “Here are my invoices, that’s what I bought and that’s what I sold. Thin margin? Well, that’s the nature of this business, in this neighborhood. My customers want bargains.”

      nk (df76d4)

    25. But my point being one group is rightly financed while the other group is unconstitutionally financed. Why should the one pay just to make the other pay?

      John Hitchcock (3fd153)

    26. John,
      There are numerous entitlement recipients. Not sure about the constitutionality point you raise but Americans collectively have to make a conscious choice that if the country is worth saving it may require sacrifice, whether it be in seeing current tax rates maintained with stipulation it applies x% to deficit reduction, a welfare recipient seeing the value of their stipend decrease (and increase incentive to get a better income through a job), medicare recipients seeing the relative value freeze for a few years, or a retired vet realizing that in order to collect the retirement pay they earned for the remainder of their life they may need to “take one with the team” as well.

      voiceofreason2 (2f73b8)

    27. My mother has spent 35 or 36 years working at Kroger, a large grocery chain. She has had stories of food stamps.

      “I’m sorry, you cannot buy dog food with food stamps.”
      “Then I’ll feed my dog steak.”

      Or, well-dressed, pays in food stamps, climbs in brand new caddy.

      Lots of years, lots of stories. And in a small town (15,000).

      John Hitchcock (3fd153)

    28. James Madison:

      “With respect to the two words ‘general welfare,’ I have always regarded them as qualified by the detail of powers connected with them. To take them in a literal and unlimited sense would be a metamorphosis of the Constitution into a character which there is a host of proofs was not contemplated by its creators.”

      And Davy Crockett’s words here.

      I’ll state again that reverting our government to the constitutional restrictions will fix the vast majority of what’s wrong with government.

      John Hitchcock (3fd153)

    29. the point is about shared sacrifice –
      Freezes on colas are an example of how people share a sacrifice.

      Comment by voiceofreason2 — 11/29/2009 @ 8:36 am

      Um, yea, how about a flat tax on everyone? That would be shared sacrifice. Your solution seems more like communism. If I work for a living I should be rewarded for my performance and not taxed at a higher rate because someone else didn’t graduate from a state run high school where the teachers are more concerned with praising the prez (Mmmm, mmmm, mmm) than getting little Jonnie to read and write.

      You want to solve all these problems? It’s easy. Get the government out of the charity biz. Get the government out of the insurance biz. Get the government to do what they are supposed to do. Secure the borders to start with. Then come talk shared sacrifice.

      PatriotRider (1729de)

    30. a reminder….
      The retired members of the Military receive Retirement Pay, not a pension, and it is fully taxed as pay.
      It is the deal we made with them when they committed to serve for 20+ years.
      Technically, they can be called back to active duty at any time, and sometimes are, voluntarily and non.

      AD - RtR/OS! (27348e)

    31. OT, but the distribution of ready-made cigarettes, worldwide, is a fascinating example of successful totalitarianism through cooperation between government and business.

      Sure is – for decades the Chinese Gov’t advertised how awesome smoking was for everyone, particularly since they owned most (and now all) of the tobacco companies operating in that country. And talk about the law of unintended consequences: now they’re among the leaders in lung cancer cases among the adult population, and their medical care expenses are becoming astronomical as a result.

      Dmac (a964d5)

    32. I got food stamps for a while in grad school. When I got a job I computed how much I had received and sent the government a check.

      Start the laugh track now.

      Simon Kenton (3d943d)

    33. Well done, Simon Kenton. You’re a man of character.

      DRJ (dee47d)

    34. Nah, Simon, you get cudos from me.

      John Hitchcock (3fd153)

    35. Actually, Simon Kenton, it’s always struck me as government negligence (and a bad economic decision) that a pay back schedule of some sort for when the person has made it off welfare, is not built into the system. Even if it’s a small percentage of the benefits paid, it would be some reimbursement…

      It’s as if the goal off getting off relief as quickly as possible, is no longer there. It’s okay to live your entire life dependent on other people’s hard earned money.

      That it isn’t makes me think several things: few get off of it, which we see as it’s certainly a multi-generational way of life for many. It would seem the dependency factor is passed down.

      Also, there is a lack of impetus for some to push the hard rock uphill and make it a goal to wean themselves from dependency, let alone *see the need* to do so (financial independence, self-respect) because they don’t see anything wrong or self-defeating about living off the government. There is no longer a loss of dignity about it or a blanching at finding oneself in a position of *needing* the help.

      Of course these are generalizations and not everyone is this way, but in the past decades it seems to have become more commonplace and many have been willing to settle and accept it. (This all of course does not pertain to those families who find themselves in the awful place of needing the help and are trying to find their way back to self-reliance).

      Dana (e9ba20)

    36. Artsy Dana, very well put. Go buy a pair of Sauconys with my blessing. It’s the government hand-out with the promise of “there’s more where that came from” vs private charity hand-ups with the idea “until you get back on your feet” that is key. The former provides a voting base and dependent class which erodes the nation while the latter provides assistance through rough times and an aim for self-sufficiency. The former is unconstitutional while the latter is ingrained in our traditional society, dating back 300 years or further.

      John Hitchcock (3fd153)

    37. Your solution seems more like communism.Comment by PatriotRider — 11/29/2009

      Not sure I agree with that – if I said the rich need to be taxed even more to make up for the “have nots” that would be one thing. What I am suggesting is that if everyone really wants to see us get out of the hole we are in it will require some sacrifice from all people. Or we can point fingers at one demographic or another and say that is the only viable fix. Tax them out of existence or provide nothing to the have nots.
      Not realistic and not going to save the country from ultimate bankruptcy.

      Comment by AD – RtR/OS! — 11/29/2009

      I am a vet and collect the retired pension. I used it as an example of how each person may need to examine what level of sacrifice they are willing to give in order to keep the country from going bankrupt. A freeze on cola payments is simply no cost of living increases. But if everyone else is sacrificing (tax cuts deferred until deficit reduced and social programs (food stamps, etc.) frozen at current rate with no cola involved I would be willing for that to be my part.

      voiceofreason2 (2f73b8)

    38. Re military retirement – we are not taxed for anything except state (if applicable) and federal tax. If we contribute to the survivor benefit plan that is exempt from either tax.

      voiceofreason2 (2f73b8)

    39. One problem with using the current tax code in this manner to solve economic problems is that almost half of the people in the country pay no income taxes,
      and don’t have any skin in the game.
      I don’t believe in penalizing the productive to benefit the unproductive since it appears it is the unproductive that are the major contributors to the problem
      (along with the political class – but that doesn’t seem solvable through the tax code).
      Penalizing the productive is the route the current political class seems to wish to follow, and it is resulting in a great many productive people “Going Galt”,
      which is not a solution, but is a survival tool.

      AD - RtR/OS! (27348e)

    40. @ voiceofreason2 11:10

      Your statement about shared sacrifice as a temporary and noble salve seems so simple and reasonable on its face. That is, until one points out that there is virtually no will in Washington, or in academia, or among the largest recipients of government pork to EVER reduce the deficit.

      elissa (5f95c4)

    41. Maybe the jobs would be “there” if the government stopped (1) sucking all the capital out of the economy so businesses could grow and (2) keeping people dumb by poor education or dependent with limitless benefits.

      Patricia, I’m not disputing that at all, but the fact remains that we are a service and consumer-based economy, and we are now seeing the result of that in the form of the current depression. Obama’s biggest blind spot (and there are many) in reaction to this has been to act as if the cost of healthcare is the reason the economy is in dumper, when in fact it has been the over-leveraging of debt and credit. That’s why he, Bernanke, and Geithner have no problem spending like there’s no tomorrow.

      Our economy just isn’t going to stabilize in the long-term and the government will continue to play extend and pretend until someone can figure out how to make this a manufacturing-based economy again, as opposed to a consumer-based economy. Everything they are doing right now is nothing more than can-kicking in the hopes that the economy will simply magically recover on its own, or the populace develops amnesia and spends itself into oblivion again. Killing the Fed and making sure Congress goes back to doing its Constitutionally-directed job at regulating the currency would help too.

      Another Chris (470967)

    42. DMac #31,

      The whole world. Phillip Morris, for example, sells its entire output to only eight distributors. Just eight. They have their own sub-distributors, who have their sub-sub-distributors, et cetera. Their “territories” seem to be determined by economy of transportation. Diverting is not allowed. Everybody must sell only within his territory and pay his taxes.

      There are “diverters”, who steal shipping containers off the docks, for the non-taxed trade (maybe 1% of all cigarette sales, if that much). They obey the same rules but violation of hierarchy or territory in their case does not result in loss of license, it results in their disappearance.

      nk (df76d4)

    43. The profits, especially for government, are astronomical. A pack of cigarettes off the first distributor goes for $0.80. By the time it reaches the Marathon at my street corner it sells for $7.40.

      nk (df76d4)

    44. That is, until one points out that there is virtually no will in Washington, or in academia, or among the largest recipients of government pork to EVER reduce the deficit.

      I would recommend taking a look at defense contracts and who supports them. No one equates jobs at Lockheed with welfare but congressmen helping out their districts for dubious value added mil purchases are doing the same thing. The pork that goes to some of the defense budgets makes what goes to acadmia seem like small potatoes.

      voiceofreason2 (4be1b3)


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