Robert Rubin, who was Treasury secretary in the Clinton administration, and Diane Whitmore Schanzenbach, director of The Hamilton Project, a Washington, D.C.-based economic policy group, had a piece last week in the Wall Street Journal on the food stamp program.
Their argument is summed up in this sentence: "Alleviating food insecurity is not only a moral imperative; it also makes good economic sense." They are against the re-introduction of a three-month time limit on food stamps for some unemployed adults. Because if this limit, nearly a million working-age adults soon will or already have ceased to receive food stamps over a month's time.
Ms. Schanzenbach is coauthor of a Hamilton Project study entitled "Twelve Facts about Food Insecurity and SNAP"-– Supplemental Nutrition Assistance Program (SNAP) is the official name for the food stamp program. It claims that there are long-term health and other benefits of the SNAP program.
I glanced at the Hamilton Project study and found some of it quite disturbing. Here is something I think we need to question before extending the time people can receive food stamps:
Food insecurity, often thought to be a characteristic of poverty, is actually dispersed widely over the income distribution, though food insecurity does decline as a household's income increases. Notably, a large share of food-insecure households live above the federal poverty level (FPL) with incomes that are above the reach of SNAP and other food support programs. One-third of food-insecure households have reported incomes between 100 and 200 percent of the FPL and another third have reported incomes above 200 percent of the FPL—a level at which households are typically not eligible for SNAP or subsidized school meals. Many of these families have incomes above the reach of the EITC as well, which phases out near 185 percent of the FPL (Urban-Brookings Tax Policy Center 2016).
First off , there is the idea of "income distribution." Income is not "distributed" in a free-market society. It is earned: some people may have disabilities that prevent them from earning, and some willing people may not be able to find jobs in this economy, but by and large we should not think of income as being "distributed" but as being a product of one's industry.
If families that have an income of twice the federal poverty level and are above the EITC level and are not able to feed themselves, is it possible that rather than direct food subsidies, they might benefit from help in learning to use resources better?
Looking at the Hamilton study, I still question the morality of long-term dependence on food stamps for many households. One can argue that there are morally corrosive effects to long-term use of the food stamps program. The case was eloquently made by Rick Franklin of Charlottesville, Virginia in a Letter-to-the-Editor of the Wall Street Journal:
No decent person wants any child to go to bed hungry. However, the net benefit of extended food—or housing or income—assistance for working-age adults isn’t so clear. The Obama administration introduced or expanded all sorts of social programs over the past eight years based on an economic “multiplier” effect that would turn $1 spent on benefits into $1.50 or more of economic growth. But eight years and trillions of dollars later, the economy is sputtering at a rate that is insufficient to lift people out of dependence on taxpayers.
It appears that overly generous public assistance, at the margin, discourages work, puts fiscal stress on governments and ultimately generates a negative multiplier that depresses growth. The proposition that narrowing the rewards of not working, versus working, is good for the economy is preposterous and at odds with any basic understanding of human behavior. Making SNAP a long-term program for working-age adults turns a compassionate short-term safety net into an entitlement that mostly feeds the voracious appetite of Washington’s benevolent income redistributors.