Will Walmart fight FOR food-stamp recipients?

Bill Knight column for Thurs., Fri., or Sat., Dec. 5, 6 or 7

Food-stamp funding last month was cut by $5 billion a year, as the temporary boost in benefits from the 2009 stimulus package expired. All 47 million Americans who get food stamps, or SNAP (Supplemental Nutrition Assistance Program), are dealing with a 5 percent cut.

The cut is separate from Farm Bill proposals to slash SNAP over 10 years by $4 billion (the Senate proposal) or even $39 billion (the House proposal). However, food stamps as an issue may have reached a turning point in its exaggerated criticism and controversy.

Walmart has a stake.

Attacks on food stamps have included allegations that fraud is widespread, that the need isn’t really there, that African Americans have become dependent on the program, or that food stamps are another “entitlement” that should be eliminated. (That latter talking point is worth some separate examination since “entitlement” should not be derogatory; it actually means someone is entitled or has a right to something, whether Social Security or GI benefits, or the right to worship or pursue happiness.)

Some history: Malnutrition and hunger were problems 50 years ago, when bipartisan support from people ranging from Democratic Sen. George McGovern to Republican Sen. Bob Dole, and from business interests such as farmers and grocers, cooperated to create the food stamp program and mostly alleviate the situation.

“Fifty years ago, stunting and wasting were problems in impoverished communities in the United States,” said University of Illinois economist Craig Gundersen. “That’s why food stamps were introduced – to address that problem.”

In the decades since, recipients increased with need. After the 2008 economic meltdown, for instance, recipients more than doubled from 20 million, and expenditures went from $38 billion to $82 billion. The National Bureau of Economic Research this summer reported that the main cause of the rise in the use of food stamps was the Great Recession, and its effects linger despite a booming Wall Street, Federal Reserve action and the stimulus, which included food stamps because spending them quickly injects value into the economy.

But they’ve been targeted before, like in 1996, when Congress passed new restrictions, such as limiting childless adults to only three months’ eligibility out of three years if not working 20 hours per week or taking part in a jobs program. Criticism got more political during the 2012 presidential primary campaign, when Republican candidate Newt Gingrich implied that recipients of food stamps were lazy African Americans.

However, just 22 percent of food-stamp recipients are black. And as to the fraud charge, the U.S. Department of Agriculture (USDA) this year investigated the claim, but found the program remarkably free of such deceipt, with only 2.8 percent of food stamps given to ineligible people.

“SNAP is a very efficient program,” Gundersen said. “It’s also very effective.”

Further, it’s effective despite the average allocation being just $1.40 per person per meal.

As far as Walmart: The world’s biggest retailer counts on food stamps.

“Walmart accounts for about 10 percent of total U.S. sales but gets 18 percent of the nation’s food-stamp-related sales,” said Daniel Gross in Newsweek/The Daily Beast. “That means it punches well above its weight compared with other retailers. Put another way, Walmart customers are far more likely than shoppers at other stores to finance their purchases with food stamps.”

The Wall Street Journal reported, “Walmart pulled in $14 billion of the $80 billion the USDA says was appropriated for food stamps in the year ended in September 2012.”

In some areas, Walmart employees make up a sizable percentage of food-stamp users, research shows.

“In state after state, the largest group of Medicaid recipients is Walmart employees. I'm sure that the same thing is true of food-stamp recipients,” said U.S. Rep. Alan Grayson (D-Fla.).

For example, Policy Matters Ohio used data from the state’s Department of Job and Family Services and reported on employers with the largest number of workers participating in the food-stamp, Medicaid and cash-assistance programs. The report showed that for food stamps, McDonald's was first with 9,316, followed by Walmart, with 8,565. Similarly, the Lewiston (Maine) Sun Journal obtained information from that state’s Department of Health and Human Services on employers with the largest number of workers on food stamps, Medicaid and Temporary Assistance to Needy Families, and at the top of the list was Walmart, with 1,100 employees.

So, since Walmart has such a significant financial stake in food stamps – employees and customers alike – maybe the corporation will defend food stamps. If this profitable and influential company, together with long-time supporters of the program’s goals, doesn’t strengthen SNAP, more people will be left behind.

Money might be saved, but the consequences could be dire.

“Food insecurity rates are going to increase,” Gundersen said.

[PICTURED: Graphic from alfunnynutsland]