Since President Obama assumed office, participation in SNAP, which was formerly referred to as food stamps, has increased from 32 million to 47.8 million people, and annual spending on SNAP has doubled to $80 billion in fiscal year 2012. Over the next 10 years, SNAP is projected to cost taxpayers almost $760 billion…
This explosive growth in both the SNAP enrollment and federal cost of the program is alarming and requires lawmakers to take cost-effective legislative control measures.
Not only does his bill, introduced jointly with Congressman Marlin Stutzman (R-Ind.), understate the expected growth of SNAP, he also overstated the impact his bill would have if it is passed. His bill would save $30 billion over ten years, compared to the program’s annual cost which now approaches $80 billion, and accelerating.
According to the U.S. Department of Agriculture (USDA), which administers the program, the cost in 2008 was $34.8 billion but exceeded $74.6 billion in 2012, an annual growth rate of 20%. If that growth rate continues, in ten years SNAP will cost $600 billion annually. Even if somehow SNAP growth is slowed to just 10% a year, taxpayers will still be paying $200 billion a year for a program that the USDA estimated back in 1964 would eventually cover just 4 million people and cost about $360 million annually.
As Thune noted, the number of SNAP participants is approaching 50 million Americans, and has been growing at 12% a year. At present that translates into one out of every five households receiving SNAP assistance, and if the present growth rate continues, two out of five households will be on SNAP by the end of the decade.
In some places in the country, entire towns are dependent upon the monthly insertion of federal assistance through Electronic Benefit Transfer (EBT) cards. For instance, in Woonsocket, Rhode Island, one-third of the town’s population – 13,752 out of 41,186 – is on SNAP assistance.
Such government dependency impacts peoples’ lives in Woonsocket enormously. In Miguel Pichardo’s International Meat Market, for example, the day before those 13,000 residents have their EBT cards recharged with $3.6 million of federal assistance (an average of $265 per card), Pichardo does very little business. On February 28th (EBT cards are recharged at midnight of the first day of each month), his store did $526 in business. On March 1st, he did $8,200 in business, nearly all of it on EBT cards.
The ripple effect is felt all across the town. As Eli Saslow of the Washington Post explained:
SNAP enrollment in Rhode Island had been rising for six years, up from 73,000 people to nearly 180,000, and now three-quarters of purchases at [Pichardo’s] International Meat Market are paid for with Electronic Benefit Transfer (EBT) cards.
Government money had in effect funded the truckloads of food at Pichardo’s dock . . . and the three part-time employees he had hired to unload it . . . and the walk-in freezer he had installed to store surplus product . . . and the electric bills he paid to run that freezer, at nearly $2,000 each month.
Families that are dependent upon that midnight insertion of taxpayer funds into their EBT cards have changed the way they shop. There were five customers waiting in Pichardo’s parking lot 30 minutes before he opened for business on March 1st. They shopped the first-of-the-month specials at nearby Shaw’s Market which now has a “dollar aisle” in order to compete with other local dollar stores. Walmart is open 24 hours a day and shoppers came in late Thursday night, filled up their carts, and waited for midnight March 1st to arrive so they could pay for their purchases with their EBT cards.
The city buses are so busy the first and last days of the month that taxi drivers wait by bus stations to handle the overflow traffic. The bus company has had to limit the number of shopping bags each customer can bring onto the bus to seven, and taxis are there to help those with more than the buses allow, for $4.75.
One of those shoppers whom Saslow followed spent more than half of her SNAP EBT card balance by noon on Friday and hadn’t completed even half of her shopping for her husband and two kids. She figured that she had enough to cover them for the next week or ten days, and then she would go back to counting pennies. She has the first of the month circled in red on her calendar.
The SNAP program has grown so rapidly over the last five years, partly because of the recession and partly because of the relative ease of qualifying for it, that Thune’s bill, even if passed, will have negligible impact on it. As dependence on it grows there is less and less incentive by politicians such as Thune or dependents such as Pichardo to change anything. At present growth rates, the only thing likely to slow down SNAP is the inevitable inability of the government to continue to pay for these programs. When that happens, dependents all across the country, including those living from EBT to EBT in Woonsocket, are going to have another major adjustment to make in their lives.