he mid-June failure of the House of Representatives to pass a five-year $940 billion Federal farm bill is but the most recent dysfunctional episode in the tenure of House Speaker John Boehner. Liberal urban Democrats mainly objected to cuts in food stamps, known since 2008 as SNAP (the Supplemental Nutritional Assistance Program), while Tea Party Republicans turned on Boehner because even current food stamp benefits were deemed too generous. Then in July the House passed a bill with food stamps zeroed out entirely. No one knows as of the time of this writing where this will lead. Most likely, the poor will not have food stamps reauthorized at proposed levels, but neither will well-marbled commodity groups receive all their expected benefits. Understanding how we got here requires a quick retelling of the history of food stamps and an explanation of their formerly symbiotic relationship with farm subsidies.
The origins of both agricultural subsidies and the food stamps program go back to a scheme hatched as part of the New Deal in 1933 to end the agricultural depression of the 1920s and 1930s and support prices for field crops such as corn, wheat, cotton (rice, later soybeans too) and dairy in return for restricting production. The scheme was meant to augment demand while restricting supply. In the 1930s, early experiments with food stamps distributed coupons conferring the right to purchase federally held foodstuffs (themselves the result of subsidized overproduction) so as to diminish supply and raise prices.
After a hiatus, in the 1960s Agriculture Secretary and former Minnesota Governor Orville Freeman, together with his political allies Hubert H. Humphrey and George McGovern, and with fulsome bipartisan support from farm-state Republicans such as Robert Dole, proposed a renewed Federal program enabling poor families to purchase food with a subsidy from the Federal government. If there is a research “silver bullet” for documenting the coalescence of this arrangement in its post-World War II configuration, this quote from a May 3, 1964 New York Times report is it:
Enactment of the cotton and wheat subsidy bill last month demonstrated President Johnson’s versatility in legislative maneuver. . . . Working quietly, by telephone and in private conferences, the President and Secretary of Agriculture Orville L. Freeman, helped engineer a series of deals that also brought House passage of the Administration’s food-stamp bill to aid the needy. A House majority for approval of both measures was concocted from the juxtaposition of the often-conflicting interests of cotton and wheat farmers, the textile industry and big-city Democrats. A massive display of vote-swapping resulted. Urban Democrats supported the farm bill, but only after their country colleagues had provided needed votes for passage of the food stamp measure. Representatives of cotton and wheat areas exchanged votes among themselves to help muster a majority for the farm bill.
The next time the same votes came up, they were pre-packaged in a single bill. The idea, politically speaking, was that by joining agricultural subsidies, politically popular in farm states, with food stamps, mainly popular in large cities, both appropriations would be safe for the long term. And they were—for a very long time, anyway.
From the 1960s until the 1990s, the food coupons functioned more or less like the old S&H green stamps, enabling eligible poor families to extend their household food budgets. During this period, especially because most single mothers eligible for Aid to Families with Dependent Children (AFDC) were food stamp participants, a variety of urban myths arose (although a substantial share of recipients were rural poor). Among these were that “welfare queens” used food stamps to buy fast food, beer, steak and other luxuries they did not really need or presumably deserve. (The same critics now decry government interventions to reduce epidemic obesity as the actions of “food police.”)
In the 1990s, the coupons were replaced by plastic Electronic Benefit Transfer cards, which could be much more easily tracked. Eligible food for purchase was strictly monitored. These SNAP cards are the basis of the program today. During the Clinton Administration, AFDC and “welfare as we knew it” (or didn’t really, as the case may be) was replaced by Temporary Assistance to Needy Families (TANF), which encouraged recipients to find employment. TANF worked reasonably well when the business cycle was expansionary, but in recession it put inordinate pressure on food stamps as a form of relief.
To receive SNAP benefits, household gross income cannot exceed $2,442 per month for a family of four as of 2012, and net income cannot exceed $1,863 per month. Only the poorest households receive the maximum allowance, which in 2012 was $668 for a family of four. Every dollar of (reported) added net income reduces SNAP benefits by 30 cents. In sum, SNAP recipients are not and cannot be living the proverbial Life of Riley.
The implications of the Bush-era recession for Federal deficit spending, already at record levels when he left office in 2008, were clear when it came to SNAP. In 2007, Federal spending on food stamps was $30.4 billion; by 2011, it had risen to $71.8 billion. Most of these recipients fell into two categories: 47 percent were children under 18, and 8 percent were seniors sixty and older. About 41 percent had at least one member of the household working, and only 8 percent received payments under TANF. As my University of Minnesota colleague Benjamin Senauer, a long-time observer of the program, stated to the Federal Reserve Bank of Boston in 2012: The program “has been a lifesaver since the economic downturn.” Average monthly participation grew from 26.3 million in 2007 to 44.7 million in December 2012, when one in seven Americans relied on SNAP—a 76.8 percent increase.
So what is the Tea Party’s beef with SNAP? As an inchoate movement, it can be somewhat cryptic, but you don’t have to be able to read tea leaves to see a “screw the poor” message: The poor have no one to blame but themselves; helping them only subsidizes parasitism and a dependency culture. For urban Democrats, the objections to the bill have to do with both the highly regressive character of proposed SNAP budget cuts and secondary objections to the even more regressive distribution of commodity payments for already rich farmers (including, incidentally, Tea Party “welfare queen” Michelle Bachmann and her husband).
On the day in June when the farm bill first came to the House floor, a spokesman for the venerable and largely Republican American Farm Bureau Federation had a ready-made press release congratulating the House on its historic achievement. Only as the votes were tallied did it become clear that Boehner had failed to hold his Tea Party colleagues in line and that, together with the Democratic opposition, the bill would go down. It did: 234 to 195. And the very fact that the vote wasn’t even all that close means that something important has changed.
istorically, the political logic behind the food stamp program was the recognition on the part of farm state members of Congress that they were slowly losing the demographic and apportionment battle and needed political allies from urban districts. From the mid-1960s until recently, the urban-rural coalition was held firm by a bipartisan recognition of the interdependence of these interests. The late Allard Lowenstein, one-time Congressman from Manhattan and the brains behind the “Dump Johnson” movement, once told me of his deep unpopularity as a maverick within the Democratic Party. So in the 1970s the party leadership punished him by appointing him to the House Agriculture Committee under Chairman William R. Poage of Texas. He did the best he could with this marginal assignment; he promptly scoured his district for those eligible for food stamps, and found a few.
After 2001, the dynamic began to change, driven by two forces: the on-book and off-book deficit spending of the Bush Administration from 2001–08 and the emergence of the well-financed and largely “astroturfed” Tea Party movement after 2008. The deficits on the books and the wars off the books created the sense that we had a spending problem rather than a revenue problem; the Tea Party then insisted we do something about this phony problem. SNAP fit perfectly into this target zone, but the Tea Party closed down on the program without paying any particular attention, as usual, to their liberal colleagues. When added to the liberal objectors, Boehner could do no more than sit back and watch the sands of the farm bill run through his hands.
Whether a reprieve will occur at this point is unclear. The Senate is clearly game but the House is so deeply broken that agricultural legislation may have to return to the default position of the “permanent” farm bill of 1949—which is hopelessly out of date and might prove even more expensive than the one that just failed to past muster in the House. It may prove possible to reconcile the Senate bill with the food stampless House bill, but then again it might not.
Now, it is true—if I may anticipate any of several sentences starting with “but”—that Federal tampering with the agricultural economy does generally raise prices for consumers. And yes, it’s also true that at least some below the poverty line would not need food stamps, or need as many, if food prices were to fall to real market-based levels in normal years. You can’t blame a middle-class shopper in a city for thinking that he’s being ripped off in stereo: by the agribusiness giants on one side, and the politically organized poverty lobby on the other. The problem with this complaint is that agricultural economies are notoriously subject to highly disruptive and hard-to-predict price fluctuations. The higher price levels we have come to accept are part of a system that ensures a modicum of stability for the most critical economic function of all. In that light, it’s worth pointing out that the value of farms and farm states to the nation as a whole far exceeds their small populations. After all, everyone has to eat—every day, in fact.
A final irony in all this is that reduced SNAP benefits will put downward pressure on commodity prices, harming the farm interests that have increasingly, and mistakenly, seen the funds flowing to SNAP in zero-sum terms—as if what SNAP gained was lost to farm subsidies. Senauer cites a 2013 study in the American Journal of Agricultural Economics by Parke Wilde reporting that, in 2010, SNAP benefits accounted for more than 10 percent of all purchases of food at the retail level. An earlier USDA study estimated that for every five dollars in new SNAP benefits, $9.20 in total spending is created in local communities.1
SNAP is not just part of an old political arrangement that now looks to be breaking apart after half a century; it is actually good for farmers in pure economic terms. So if the House cannot bring itself to resolve its differences and reach accord with the Senate, the long slow climb out of the Great Recession will be that much slower, and that much harder on both farmers and the poor. But at least as regards the poor, maybe that’s how the Tea Party wants it.1Kenneth Hanson and Elise Golan, “Effects of Changes in Food Stamp Expenditures Across the U.S. Economy”, USDA Economic Research Service (August 2002).