Presidential candidate Mitt Romney was the target of an ubiquitous news story last week, when he was surreptitiously recorded last May saying,
“There are 47 percent of the people who will vote for the president no matter what. All right, there are 47 percent who are with him, who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it. That’s an entitlement. And the government should give it to them. And they will vote for this president no matter what…These are people who pay no income tax. “
Oregon’s food stamp program (“SNAP”), or Supplemental Nutrition Assistance Program, competed for news time with Romney when census data showed revealed that our state has the highest percentage of food stamp use. Nearly 2 in 10 Oregonians qualify for this program.
Are we the 47%?
Democratic Representative Kurt Schrader, a member of the House Agriculture Committee, doesn’t think so. Rep. Schrader is defending the part of the pending Farm Bill legislation, a 600 page monster with $958 billion in Federal spending attached, that funds the majority of SNAP costs. There is little disagreement that some cuts will be made. The question is how much will be cut and who will be dropped from the program.
According to Schrader, “”They’re trying to balance the budget on the backs of hungry folks. Our goal is not to do that.”
Is he right?
Since 1974, Congress has required states to offer food benefits to low-income households. Its laws and regulations are based on the Food, Conservation and Energy Act of 2008.
Currently, Oregonians are eligible for SNAP if their income is less than 185% of the poverty level, currently $3,400 per month for a family of four, regardless of whether they own their home, cars or other assets. Some in Congress want that limit lowered to 130% of the poverty level, or about $2,500 per month for a family of four, and to consider their assets when determining eligibility.
Let’s break down those costs at current eligibility levels. If housing costs account for 25% of income, transportation is 15%, Federal, State, Social Security and Medicare taxes total 15%, medical is 10%, debt is 10% (consumer debt is actually 20% of personal income), clothing, school supplies, etc. is 5%, then that leaves 20% for food. $3,400 per month, 1ess 15% taxes is $2,890. 20% of $2,890 is $578 per month for a family of four. Families of four that have less than $578 (about $130 per week) are currently eligible under the SNAP program. That’s about $32.50 per week per person.
If cuts are made, eligibility will be cut to those with a food budget of less than $425 per month for a family of four, or less than $25 per week per person.
Food vs. Nutrition
Since 1971 US food expenditures, on an inflation adjusted basis began to decline. Since 1960, however, the average American is one inch taller and fully 25 pounds heavier. In other words, food has become less expensive, but that less expensive food is a likely contributor to our national obesity epidemic.
It may be for that reason, that SNAP benefits are not meant to meet all of the food needs of a household. Its purpose is to supplement nutritional needs, therefore people do not need to be destitute to qualify for SNAP benefits. In 2009, $250 per month was the average benefit, which is available only for purchase of food such as breads and cereals, fruit and vegetables, meat, fish, poultry and dairy products, and seeds and plants used to produce food.
SNAP vs. Employment
According to the Bureau of Labor Statistics last month, US unemployment was down .1% to 8.1%. Oregon’s unemployment rate, however, was 8.9%, up.2% to 175,691. The underemployment rate, however, is 17.4% or 343,486 workers. With an average household size of about 2.45, Oregon’s underemployed are about 840,000.
Similarly, 814,460 Oregonians currently receive SNAP benefits.
Clearly, any strategy to decrease the number of people receiving these benefits must include effort to train and retrain workers, as traditional manufacturing and timber jobs have become a smaller part of its economy. That fact has not gone unnoticed by state lawmakers, who have allocated the largest percentage, 27.3%, to education.
The 40-40-20 Plan
The goal of this plan is to have an adult workforce made up of
- 40 percent college graduates,
- 40 percent with associate degrees or technical certificates and
- 20 percent with high-school degrees.
If this goal is met, Oregon can expect to not only reduce its SNAP beneficiaries, but also to compete in an increasingly competitive global environment with productive workers who will not only pay Federal income tax, but also afford their own nutrient rich diets that will lower their need for obesity related health care costs.
Schrader may be right. Instead of cutting food subsidies, perhaps a better long term investment is in a skilled work force.