Friday, December 25, 2020

SNAP benefits yield greatest economic output, research says


NBC News
Martha C. White
Wed, December 23, 2020, 7:32 PM EST

The $13 billion boost in food stamp benefits in the new coronavirus aid bill isn't some kind of giveaway to the poor — it's some of the best stimulus government money can buy.

Economists say the new increase for food stamps, known as SNAP, for the Supplemental Nutrition Assistance Program, through June wouldn't just help those going hungry during the pandemic. It would also boost the economy more than other kinds of stimulus spending.

Every dollar spent on SNAP turns into $1.73 in economic activity, compared to $1.36 for every dollar spent on federal aid to state governments and $1.29 for every dollar allocated for a payroll tax holiday, according to Moody's Analytics researchers.

Meanwhile, cutting the corporate tax rate yields a paltry 30 cents per dollar.

"Every dollar in SNAP benefits boosts the economy," said Luis Guardia, president of the nonprofit Food Research and Action Center. "It helps strengthen the existing food supply and the mechanisms that support that."


The Agriculture Department found that SNAP spending has 10 times the job creation impact of other transfer payments or federal expenditures, particularly in rural areas.


SNAP benefits are based on the Agriculture Department's Thrifty Food Plan, which calculates weekly food costs of about $40 a week for single adults, or $134.50 for a family of four.

The budget assumes that shoppers can buy in bulk to get lower prices. That isn't always possible for families who live paycheck to paycheck.


Because of the pandemic, the number of Americans estimated to be at risk of going hungry has risen from 35 million to nearly 50 million, according to estimates by the nonprofit Feeding America.

Much of that new need is coming from people who've never had to reach for food stamps before.


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