Congress makes the plight of the working poor worse

Posted by AzBlueMeanie:

Congress still has not passed a "farm bill" with funding for the Supplemental Nutrition Assistance Program (SNAP) aka food stamps. The expiration of the 2009 federal stimulus on November 1 meant a five percent cut in food stamp assistance to the poor. The New York Times reports today, Cut in Food Stamps Forces Hard Choices on Poor:

For many, a $10 or $20 cut in the monthly food budget would be absorbed with little notice.

But for millions of poor Americans who rely on food stamps, reductions that began this month present awful choices. One gallon of milk for the kids instead of two. No fresh broccoli for dinner or snacks to take to school. Weeks of grits and margarine for breakfast.

And for many, it will mean turning to a food pantry or a soup kitchen by the middle of the month.

“I don’t need a whole lot to eat,” said Leon Simmons, 63, who spends more than half of his monthly $832 Social Security income to rent a room in an East Charleston house. “But this month I know I’m not going to buy any meats.”

Mr. Simmons’s allotment from the federal Supplemental Nutrition Assistance Program, commonly called food stamps, has dropped $9. He has already spent the $33 he received for November.

The reduction in benefits has affected more than 47 million people like Mr. Simmons. It is the largest wholesale cut in the program since Congress passed the first Food Stamps Act in 1964 and touches about one in every seven Americans.

From the country kitchens of the South to the bodegas of New York, the pain is already being felt.

In 2009, people started getting as much as 13.6 percent more in food stamps as part of the federal economic stimulus package, but that increase has expired. The reduction will save the government about $5 billion next year.

Over all, the nation’s food stamps program cost a record $78.4 billion in the 2012 fiscal year, according to the Agriculture Department. Although the amount given to each household — a figure that can vary widely depending on a complex formula of income and the number of mouths to feed — has been dropping by small amounts for the past few years, the roster of people seeking assistance grew steadily through the recession.

In the 2010 fiscal year, 40.3 million people were enrolled. Two years later, that number jumped by 16 percent. Just over 45 percent of those getting food stamps are children, according to the Agriculture Department.

Food stamps are likely to be cut more in the coming years if Congress can agree on a new farm bill, which House and Senate negotiators began tackling this week. The Republican-controlled House has approved cutting as much as $40 billion from the program by making it harder to qualify. The Democratic-controlled Senate is suggesting a $4 billion cut by making administrative changes.

To poor families trying to stretch a couple hundred dollars into a month’s worth of groceries, all the talk about stimulus packages, farm subsidies and congressional politics means little. It is all about daily survival at the grocery store.

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The cuts are also hurting stores in poor neighborhoods. The average food stamps household receives $272 a month, which then passes into the local economy.

At a Food Lion in Charleston where as many as 75 percent of the shoppers use food stamps, managers were bracing for lower receipts as the month wore on.

At a Met Foodmarket in the Bronx, where 80 percent of the 7,000 weekly customers use food stamps, overall food sales have already dropped by as much as 10 percent.

“I wasn’t expecting it to be that fast,” said Abraham Gomez, the manager. Losing that much revenue could mean cutting back hours for employees, he said.

* * *

“People at this level of need are already going hungry,” said Sister Noreen Buttimer, a nun who works at the soup kitchen, a Catholic charity. “It’s frightening how we think about the poor.”

President Obama proposed an extension of pre-November funding levels in his 2014 budget. Working to End Hunger in America | The White House. Congress has failed to act.

Unemployment, rather than poverty, is a stronger predictor of food insecurity. Hunger Statistics, Hunger Facts & Poverty Facts | Feeding America.

Congress is failing on this ground as well. Unemployment benefits for 2 million workers are set to expire in the next few months:

More than 2 million out-of-work Americans will lose their unemployment benefits early next year unless Congress extends a jobless-aid program that's set to expire, a new report warns.

Here's the back story: The United States currently has about 4.1 million workers who have been out of a job for at least six months. About one-third of them are still scraping by with help from an unemployment-benefit program that Congress temporarily expanded in 2008 in response to the financial crisis and severe recession.

But that's all set to change soon. On Dec. 31, the federally funded Emergency Unemployment Compensation program is slated to expire. Once that happens, jobless aid programs will largely shrink to their pre-recession states, and millions of people will lose their unemployment benefits.

The report (pdf), from the National Employment Law Project, estimates that 1.3 million jobless workers will lose their benefits immediately at the start of 2014. Another 850,000 workers will exhaust their regular unemployment insurance in March and won't be able to take advantage of the expanded benefits.

In regular times, the states and federal government work together to fund up to 26 weeks of unemployment benefits. (The precise number varies from state to state — North Carolina only provides up to 19 weeks, Michigan 20 weeks.) When unemployment is especially high, states can receive partial funding to provide an additional 13 or 20 weeks of "extended benefits," depending on the situation.

Again, that's the normal system. Starting in 2008, after the financial crisis hit, Congress expanded this program significantly. First, the federal government promised to pick up the entire tab for those "extended benefits" and make it easier for states to receive this money. Second, Congress created the Emergency Unemployment Compensation program to provide additional aid to workers when their state benefits ran out.

This additional financing has shrunk somewhat from its peak — currently only about one-third of the long-term unemployed receive benefits, and the sequestration cuts have pared back benefit levels. Yet many states still offer up to 63 or even 73 weeks of unemployment aid.

Come January, however, that's all slated to end. At that point, most states will only offer the regular 26 weeks or less of unemployment insurance. And the NELP report thinks this will have two big effects:

— 1.3 million of the long-term unemployed will immediately lose their emergency benefits come January.

— Another 850,000 workers will exhaust their "normal"  unemployment benefits by March and not receive additional help.

The lapse in benefits is also expected to exert some drag on the economy. Michael Feroli, the chief economist of JP Morgan, estimates that the expiration of benefits will shave about 0.4 percentage points from first-quarter economic growth next year. The Economic Policy Institute recently estimate that the lapse will cut GDP by about 0.2 percent and cost 310,000 jobs.

Congress certainly has the power to extend those emergency jobless benefits — lawmakers did exactly that last January, as part of the fiscal cliff deal. Extending the program through the end of 2014 would cost roughly $25.2 billion.

* * *

There are still three times as many long-term unemployed workers — those who have have been out of work six months or more — than there were before the recession. And many unemployed workers still can't find work. There are currently an estimated 2.9 unemployed workers for every job opening that appears.

So far, however, Congress has shown little interest in this issue. Last week, a stimulus-era expansion of the food stamp program was allowed to sunset as scheduled, cutting $5 billion in food aid for 47 million Americans, with little protest from lawmakers. So it's unclear whether the expiration of the unemployment program will attract much interest.

As Sister Noreen Buttimer said, “It’s frightening how we think about the poor.” WWJD?

UPDATE: Joan McCarter at Daily Kos puts this in context, 50 billionaires received $11.3 million in farm welfare, could get more in new farm bill. For that kind of money, we could feed a lot of hungry people in need.

One response to “Congress makes the plight of the working poor worse

  1. Prup (aka Jim Benton)

    One problem with most of our standard arguments on these topics is that people have heard them all before. If they weren’t moved during the last ten times they were told, why should they respond to the same argument differently this time. (Okay, a few will because it has become more personal, or because their brain — and conscience — finally kicks into motion, but not that many.)

    The further arguments out there, ones that are less familiar, might just work better. The ‘multiplier effect’ — not shown as a statistic but by personalizing it — is one that people who read pundits already, mostly, understand, but how many candidates, how many ads actually use it. (Imagine an ad with a shopkeeper telling people how his business has fallen off because of the cuts, and how he’s had to lay employees back or cut back their hours enough that now they need and qualify for the stamps.)

    And one thing I’ve never seen used at all is the disproportionate effect this has on the more conservative religious groups, the strong Catholics, Orthodox Jews, and conservative Protestants who have larger families than most. They are also strongly Republican, but maybe if they realized they were getting hit…

    Finally — and this is very tricky and has to be handled like nitroglycerine — few fathers or mothers who see their kids hungry, needing milk, needing food, are simply going to calmly accept a further cut in the money. They’ll get the money … somehow, and that ‘somehow’ might get people thinking.