The US Department of Agriculture (USDA) recently released new data on food insecurity among US households, documenting near-record lows in 2021. The USDA found that only 10.2 percent of households were food insecure at any point during 2021—defined as having limited “access to adequate food for active, healthy living” due to a “lack of money and other resources.” A smaller share of households—3.8 percent—experienced a more severe form of food insecurity, reflecting “food intake of one or more members is reduced and normal eating patterns are disrupted.”
Notably, this year’s data continue a decades-long trend of declining food insecurity among US households, largely due to an improving economy after the Great Recession. These trends reflect the ability of the economy to meet the food needs for most households, with public and private efforts filling in the gaps. However, this year’s data also raise some important questions about the relationship between federal spending, such as the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps) and outcomes such as food insecurity rates, employment, and diet quality.
SNAP, which offers low-income families a benefit to help pay for groceries, was designed to reduce food insecurity among families in need. Research throughout the mid-2000s suggests that SNAP has largely fulfilled its promise, reducing food insecurity among millions of Americans in poverty. Up until the pandemic, federal dollars on SNAP appeared mostly effective, as increases in spending tracked with lower rates of food insecurity. Advocates for higher federal spending argue that increasing SNAP even more will further reduce food insecurity rates. However, recent surges in federal spending on SNAP suggest that pouring more and more money into the program will do little to reduce food insecurity rates, making the potential negative consequences of increased SNAP spending that much more important to consider.
As shown in the figure below, the large increases in SNAP expenditures in 2020 and 2021 have not corresponded to large declines in food insecurity rates. Congress authorized emergency SNAP allotments in 2020 and increased SNAP benefits temporarily in 2021 by 15 percent, while President Joe Biden’s administration permanently increased SNAP benefit levels by 25 percent in October 2021 (benefits will also adjust for inflation on October 1, 2022). The overall result has been a 40 percent increase in SNAP expenditures in constant dollars since before the pandemic. Despite these dramatic increases in federal spending, we have not seen similar declines in food insecurity rates.
These trends should raise a few red flags, the first being cost. The Congressional Budget Office estimates that annual SNAP expenditures will remain north of $100 billion through 2032—$50 billion more in real dollars than in 2019, the last full year before the pandemic. Funding to pay for these added expenditures will increase the federal deficit, unless accompanied by tax increases or program cuts elsewhere. Moreover, additional annual funding for SNAP likely means less available for other programs, including public investments in children.
The second concern involves the unintended employment consequences of expanding SNAP. Research suggests that SNAP receipt can reduce employment by affecting decisions around work, making the return to pre-COVID labor force participation rates even more challenging in the context of a larger government safety net, including SNAP.
Perhaps the most concerning consequence, however, is the potential negative effect on the health and nutrition of low-income Americans. A study by the USDA in 2016 found that households spend nearly a quarter of their SNAP benefits on sugary beverages, frozen prepared foods, and prepared desserts, occupying three of the top five spending categories. The Centers for Disease Control and Prevention (CDC) consistently warns of the negative health effects of sugary beverage consumption, associating it with “weight gain, obesity, type 2 diabetes, heart disease, kidney diseases, non-alcoholic liver disease, tooth decay and cavities, and gout, a type of arthritis.” Research has also linked prepared foods and desserts like those purchased by SNAP households, to poor health outcomes. Already, almost 42 percent of adults in the US and 20 percent of children are obese, with SNAP doing little to address this public health crisis.
The statistics on diet-related health among Americans are getting worse, while food security rates have steadily improved. This suggests that the federal government could pay more attention to diet quality, including the role that SNAP plays in contributing to poor nutrition. Drastic increases in spending throughout the pandemic suggests that continued expansions to SNAP are unlikely to lead to meaningfully lower food insecurity rates, while raising the potential for unintended consequences, such as employment declines and poor health.
Correction: The original version of this post misstated that 3.08 percent of households experienced the following: “food intake of one or more members is reduced and normal eating patterns are disrupted.” The correct number is 3.8 percent.
The post Does More Federal Assistance Lead to Less Food Insecurity? appeared first on American Enterprise Institute – AEI.