Wednesday, September 14, 2016

My Column In Today's Rapid City Journal: "Food Stamps Boost SD Economy"

I don't get the Republican rush to take the SNAP program (Supplementary Nutrition Assistance Program, aka "food stamps") away from the Farm Bill and its overseeing agency the USDA.
Yours Truly
The GOP platform this year vows "to correct a mistake made when the Food Stamp program was first created in 1964 by separating the administration of SNAP from the Department of Agriculture."
The platform notes that 70 percent of all Farm Bill spending is consumed by SNAP and that during the Obama administration "nearly all the work requirements for able-bodied adults" instituted by the landmark welfare reform of 1996 "have been removed."
By pulling the program away from the USDA/Farm Bill's embrace, the GOP will, of course, make it a stand-alone item in Congressional budget negotiations, where it will become the political football that the party apparently wants it to be. That bit about "able-bodied adults" is a clear enough signal that it's all about politics.
As residents of a state that is economically all-in when it comes to policies affecting the agriculture sector of the American economy, we South Dakotans need to keep a wary eye on efforts to politicize a program that is used to help feed about 45 million Americans. We raise much of that food those folks are consuming.
Dissing food stamps and the "able-bodied adults" that are using them makes for nice sound bytes in some political circles, but seriously cutting back on that program would be a monumental disaster for states like ours.
First off, in context, the program represents an infinitesimal portion of our country's wealth. Consuming $75 billion out of a federal budget of nearly $4 trillion, SNAP spending peaked at a half-of-1 percent of GDP in 2012. It has since fallen to .4 percent and is projected by the Congressional Budget Office to return to its 1995 level of .3 percent within a decade.
At his nominating convention last July, Donald Trump correctly noted that 43 million Americans are using food stamps, but ignored the fact that the number has declined from its recession peak of 48 million during the past few years.
He also failed to cite what I believe is the most relevant aspect of SNAP to South Dakotans and other farm-belt residents: the program is a powerful economic engine for food production in this country. The USDA's Economic Research Service calculates that for every five dollars spent on SNAP benefits, nine dollars of economic activity is created. When the subject of splitting SNAP away from the Farm Bill came up in 2012, more than 500 farm groups, including the American Farm Bureau Federation, opposed the idea.
They were joined by Forbes Magazine contributor Beth Hoffman, who at the time wrote that it is "critical to continue support of the program." Eighty percent of its recipients are children, disabled adults and elderly. The remainder are those "able-bodied" adults described by Republicans, all right, but they get limited benefits unless they can prove they're working 20 hours a week.
Why Trump and his GOP cohorts believe SNAP needs to be singled out for political pinata status is their business. What it might do South Dakota's economy is ours.

John Tsitrian is a Rapid City businessman and freelance writer. You can read more of his commentary on his

1 comment:

  1. It is part of the same issue we face in South Dakota, John. We try to fund government, be it city, county, school district or State, using sales taxes. As I recently pointed out to some Democrat legislative candidates, the folks you mention in your quote, "Eighty percent of its recipients are children, disabled adults and elderly" already spend all of their disposable income for necessities. By taking more of it away from them in the form of sales tax, lessens the amount they have to spend for those necessities. That is then in fact an economic development issue.

    The sales tax bill that passed to pay teachers (and give yet more property tax relief to property owners) is only one example of that type of tax. In the last session there were three more sales tax measures, to fund municipal and county governments. Another one to give municipalities another penny sales tax, came very close to passing, making it out of committee because the three Dems on the committee refused to vote to refer it to the 41st day and then voted to refer to the full house, after the 12 Republicans split 6-6. The full house passed it on to the Senate and it came out of committee there, with a do pass recommendation. Luckily the full Senate defeated it.

    The legislature doesn't want to face the fact that at some point they need to pass a state income tax and stop putting the onus on those who already spend all that they have in income for necessities, by making them pay more in sales tax.

    Folks want to believe that South Dakota cannot pass an income tax, but the Governor's recently retired Director of Economic Development, Mr Costello, said just the opposite. An income tax may be the only way that we are going to be able to get the number of employees needed to help our businesses expand.