Food Stamp Costs Skyrocket, Intensifying 2012 Farm Bill Debates In Congress

  @JaceyFortin on April 23 2012 3:11 PM
Food Stamps
The federal food stamps program, SNAP, has increased benefits to eligible families over the last few years. Now, a House proposal threatens to curtail those benefits. Reuters

Expensive federal food stamp programs have become a hot-button issue in recent weeks, and a Senate bill now in the works ensures that the highly politicized congressional debate is only just beginning.

An April 19 report from the Congressional Budget Office shows that federal spending on the national food stamp program -- officially titled the Supplemental Nutrition Assistance Program (SNAP) -- skyrocketed during the recession, costing $78 billion in 2011.  That's why conservative members of the U.S. House of Representatives last week targeted SNAP with a plan to cut about $33 billion in food stamp spending over the next ten years.

The plan would cut SNAP benefits for families who already receive food stamps; it would also tighten up eligibility requirements for new applicants.

Families who rely on SNAP needn't worry just yet; the highly partisan proposal, advanced on April 18 by the House Agriculture Committee, is not expected to pass a Senate vote. Instead, the move constitutes a symbolic objection to federal spending on social welfare programs.

The proposal is in line with Republican Wisconsin Representative Paul Ryan's divisive budget plan, which was approved by the House in March. Ryan, who argues that SNAP and other programs could transform our social safety net into a hammock, would slash domestic spending in order to reduce the federal deficit and preserve defense spending without resorting to tax hikes.

But the Senate Agriculture Committee unveiled its own very different plan on April 20 with the 2012 Farm Bill. A draft was released on April 20, and will be revisited for mark-ups on Wednesday.

The farm bill is a comprehensive omnibus bill, renewed every five years. Its main purpose is to determine the government's role in protecting and subsidizing American agriculture, but it also addresses a wide range of issues including international aid, environmental conservation, rural development, research funding, and SNAP.

This means that agricultural subsidy legislation is inextricably linked to food stamp legislation, making the politics of passage exceedingly complicated. This year, the initial draft of the farm bill is exactly 900 pages long.

Both this Senate farm bill and last week's House proposal would cut federal spending, but the difference of approach is stark.

The Senate bill focuses on streamlining the U.S. system of agricultural subsidies, which many analysts argue has become too inefficient. Studies have found that more than half of government expenditure on agriculture ends up funding insurance companies and their agents -- and many of these insurance companies are overseas. Of the money that goes directly to agricultural workers, most of it supports large, profitable producers as opposed to individual growers. And since direct payments are based on historical production, growers very frequently get paid for unfarmed land.

The Senate's proposed overhaul to address these and other problems could save about $23 billion over the next decade. It eliminates direct payments completely, and it consolidates several programs to make conservation efforts much more efficient.

But the bill has a weakness: as inefficient as subsidy policies currently are, an overhaul there could only do so much. Crop insurance subsidies and commodity payments may cost the government about $15 billion over the next five years, according to the Congressional Budget Office. Food stamps, on the other hand, are on track to cost the government a whopping $400 billion over the same time period.

That's one reason why the House proposal focuses almost exclusively on cutting SNAP funding. It could net the federal government $10 billion more per year than the Senate bill would save.

Like farm subsidies, SNAP is often blasted for its costly inefficiencies and ease of abuse. Federal spending on food stamps grew about 135 percent between 2007 and 2011, according to the Congressional Office report. This was due mostly to the recession and a greater demand for food aid, but partly to President Barack Obama's American Recovery and Investment Act of 2009, which allowed higher benefits for qualified citizens.

The increased welfare spending has been blasted by fiscal conservatives who, like Ryan, argue that such programs beget complacency and even deliberate misuse. There have also been concerns about lax eligibility rules, especially after a woman made headlines last month by defending her continued use of food stamps after winning $1 million in the lottery. The House plan would enforce stricter eligibility rules by taking a closer look at applicants' assets, and it would lower benefits for those who do qualify. Opponents argue that such a measure would place the burden of budget reform on the backs of America's poorest citizens.

Farm subsidy supporters and food stamp proponents have traditionally been allies due to their shared reliance on farm bill funding and a resulting fraternization of lobbyists. That the two groups are now pitted against each other is a clear sign of increased partisanship and zealous politicking on Capitol Hill in the run-up to November elections.

The food stamp battle will play out this summer. The House bill is unlikely to pass at all, and the Senate bill is on shaky ground -- it will face some formidable wrangling in the House. If no compromise can be reached, the existing farm bill will have to be extended. That's a risky prospect since many programs in the 2011 bill don't have baseline funding, and fights are sure to ensue over appropriations. Congress hopes to avoid this by hammering out a bipartisan solution before September 30. 

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