Food Stamps: More Benefit to Big Food Than to the Poor?

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The federal government is spending millions to encourage more Americans to apply for food stamps, or rather the Supplemental Nutrition Assistance Program (SNAP), which replaced food stamps. Ads paid for with tax dollars are asking more people to enroll in SNAP even though the program has dramatically expanded in recent years: Roughly 46 million Americans now get SNAP benefits, up from just 17 million in 2000, and the costs associated with the program have risen from $17 billion in 2000, to $30 billion in 2007, way up to $78 billion last year. While those receiving benefits must be happy with the program’s growth, there’s another group that might even be more pleased: corporations that make or sell junk food.

Sure, poor Americans who get food on the table for dinner, partly with the assistance of SNAP, must appreciate the program. But major corporations and food groups, including Pepsi, Kraft Foods, Kroger, Coca-Cola, and the Corn Refiners of America, also warmly embrace SNAP. All, in fact, have lobbied Congress and/or various states to expand SNAP and make sure that recipients have the most freedom possible in deciding how to use their allowances, including the unlimited purchase of soda and junk food.

Could it be that these powerful interest groups are supporting SNAP simply because they want to end hunger and help the poor? Or is Big Food supporting SNAP because it benefits the food industry just as much as it does those individuals who directly receive SNAP assistance?

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The idea that the food stamp program is essentially a corporate subsidy sounds like it could have been cooked up by the Tea Party or a libertarian, anti-tax group. But this argument has lately coming from very different quarters.

Michele Simon, a public health expert in Oakland, Calif., doesn’t want SNAP funding cut, nor does she want to snip societal safety nets for the poor. But she does want taxpayers to consider the possibility that, as she puts it, “SNAP represents the largest, most overlooked corporate subsidy” in the 2012 Farm Bill now being considered by Congress. Simon, who runs the watchdog group Eat Drink Politics, published a report last month entitled “Food Stamps: Follow the Money,” which demonstrated that not only do the likes of Walmart, Mars, Kroger, and Coca-Cola benefit from SNAP, but so do large banks such as J.P. Morgan Chase, which receives tens of millions annually from states in exchange for operating SNAP Electronic Benefits Transfer cards given to recipients. Among the findings in the report are that:

Companies such as Cargill, PepsiCo, and Kroger lobbied Congress on SNAP, while also donating money to America’s top antihunger organizations.

And:

J.P. Morgan Chase has contracts for Electronic Benefits Transfer (EBT) in half the states, indicating a lack of competition and significant market power.

Despite her problems with SNAP, Simon argues that funding should be maintained at its current level. But, at the very least, her recommendations include that the “USDA should grant states waivers to experiment with health-oriented improvements to SNAP” (several proposed bills to improve the health of beneficiaries by restricting what they can buy have been shot down), and that “Congress should require USDA to collect data on SNAP product purchases” (surprisingly, this data isn’t gathered already).

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Simon is not alone in proposing that we’re overdue to reexamine how food stamps and SNAP are administered, who is truly benefiting, and who may be getting hurt. In a San Francisco Chronicle story featuring Simon’s point of view, another expert, Marion Nestle, NYU professor of nutrition, notes that it is “time to consider the idea of limits”:

“Obesity was not a problem when food stamps started. Now it is. The WIC program limits purchases that can be made with vouchers.” Food stamp recipients, she said, “could still buy what they like — just not with taxpayer dollars.”

Another mainstream putdown of SNAP was recently issued by USA Today’s editorial board. The growth of SNAP, the editorial maintains “is being driven by politics as usual,” rather than any humanitarian mission to put an end to hunger in America. The methods by which the program has expanded have sometimes been alarming, the piece states:

Large families have been able to get higher amounts of assistance. States have been given greater flexibility to manage the program, which often means ignoring federal guidelines limiting the assistance based on recipient income or assets. States also have been given cash bonuses from Washington for signing up more people.

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In order to “save taxpayers a lot of money while restoring faith in the mission,” the editorial suggests, now is the time to start nudging the number of beneficiaries and amount of money spent on SNAP “back toward where they were in the mid-’90s.” But again, in recent months, the USDA is openly encouraging the opposite to happen. As CNN Money reported, “the federal government wants even more people to sign up for the safety net program,” and the USDA has been spending millions of dollars on radio ads to meet its goal. The nation’s largest grocers and food manufacturers must be pleased.

Brad Tuttle is a reporter at TIME. Find him on Twitter at @bradrtuttle. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.

20 comments
f_galton
f_galton

Instead of SNAP just give them some turnips, a pot, and some pictures illustrating how to boil.

Starshiprarity
Starshiprarity

We can complain all day about how people are abusing SNAP but still millions in america are starving because they don't have access to these funds. Its not a sign against government intervention- its a sign for more. If american welfare was properly funded so that it could afford to pay real attention to its benafactors, we'd experience a net savings by making sure the funds got to the right people.

In France, for instance, social case workers have fewer households assigned to them and are placed with the intent of building a positive relationship with their charges which helps to develop a stable support network while preventing those under support from feeling discouraged.

mkelter2011
mkelter2011

SNAP is one of the worst-run and corrupt government programs in the history of the world. 

It's sad that a bunch of a$$hole$ would abuse and loot the system so that it might not be available to people who REALLY need the program in the future.

This program is a definite candidate for some adult-supervision.

gorak
gorak

Any product the poor need must be "produced". You could pass a law requiring God to feed the poor with manna, but if you want to get it done you have to buy it from someone. 

Kalendrix
Kalendrix

So basically the government want more people to be deemed quote "poverty" so they can say they need to raise taxes secretly to fund such an expansion. As money doesnt grow on trees, someone is making cash rather it be companies or the paid politicians helping the expansion

taxedmore
taxedmore

Free food, free rent, free health care, free heat, free cell phones, don't have to pay income taxes - what's next?  Free cars?

Tommy3134
Tommy3134

Stop allowing retailers to accept food stamps.  Open up warehouses that have all or most of that stuff for 4 to 6 hours per day to recipients and let them come and get it.

sangell
sangell

My girlfriend refuses to give up her SNAP EBT even though I provide all the food we need. She is eligible so she uses her SNAP EBT as a sort of government allowance, letting her sister use it at a discount. I'm all for feeding the hungry but we need to make sure recipients of food aid are buying low cost, nutritious food not using Food Stamps as supplemental income or to buy expensive cuts of meat or Sarah Lee desserts.

failureofreality
failureofreality

Why is this news?  The Food Stamp Act states that a reason for the assistance is to aid the agriculture industry.  Without the support of the agriculture industry, there would be no Food Stamps.

El MAdster
El MAdster

Why do you call the food industry "Big Food" but do not call the poverty industry "Big Poor?"

By every measurable standard, Big Poor is bigger than Big Food - population, aggregate income, disposable income, government subsidies.

Talendria
Talendria

Lobbyists are destroying this country.

Toothy Grins
Toothy Grins

I heard that 15% of the US population is utilizing programs like this one?  Is that true?  

jrwells5
jrwells5

The National Park Service posts signs in parks warning people not to feed the animals because it deprives them of their natural instinct to find food on their own.   Wonder if the multi-generational use of SNAP doesn't show a similar effect? 

kbho425
kbho425

I  disagree...  Food  stamps,  snap.  people can still get  fresh  food   just  cold  not hot   walmart  sell fresh  cooked that   day  fried  8  pc  ckn   rot  cook  3  hours earler same  day they can get salads   fruits  whole grain bread  fresh  milk  and such.  it helps stretch our tax dollars some people are layed off in this area.  Sure... some people take advantage of system  always have.  some people are lazy  some not able to work,  age,  psychical trouble,  lack of drive  or education.  consider your self  very luck to be able to put in days work for a days pay

Talendria
Talendria

If the goal of the program is Supplemental Nutrition, obviously there are some foods that should be ineligible:  soda, candy, chips.  You'd like to think that people would be smart enough to make healthy, economical food choices on their own, but that doesn't seem to be the case.  You can't eliminate processed or prepared foods, however.  Many people don't know how to cook (or don't have time), and their children would go hungry if not for the boxed dinners.

PrinceHall
PrinceHall

^^^...obviously a misunderstanding of what SNAP is intended for and of the people who benefit from it.

PrinceHall
PrinceHall

Once again. A misunderstanding of the individuals who benefit from SNAP.

MikeTime
MikeTime

I think it's a valid concern.  If you know for sure that your food bill will be covered forever, what incentive does that give a person to try and earn more, thus becoming ineligible for SNAP, and buy food that they've been accustomed to eating on their own?

A family of 4 is allowed $668/mo for food.  I don't know about you, but that's pretty generous for "staple food".  What do I count as staples?  Whole grain breads, pasta, milk, fruits and vegetables, eggs, peanut butter, and SOME meat.  Not premium ice cream, not DiGornio pizza, not steak and lobster, and certainly not restaurants.

Sorry, but I get annoyed when I'm trying to stretch my food budget by buying things on sale and foregoing "luxury" food items, and seeing some on SNAP buy whatever they feel like.