Monday, August 27, 2012

The Tennessean is passionate but wrong about Food Stamps

In the Sunday Tennessean, the paper editorializes that "Food-stamp recipients make easy prey for greedy pols". "Forty-six million need aid congress wants to cut" says the Tennessean.

According to the Tennessean, there are not two sides to this issue. "If you think food stamps are used by a needy few, you are relying on outdated information," they say. "The U.S. Department of Agriculture distributes food-stamp assistance to feed 46.2 million Americans each month. In Tennessee, more than 1.2 million people applied for food stamps in 2010." "One in five Tennesseans cannot afford to feed their families on their own." I guess that should convince you that the level at which the food stamp program is currently funded is the correct level.There is no room for reasonable people to disagree with the Tennessean.

If you do not agree that the current level of food stamp funding is the correct level, you are just sick. You are deranged! "To gut the food-stamp program would be a deranged act," declares the Tennessean. Also, you are "deluded."

Also, if you think we are spending too much on food stamps, you infuriate the Tennessean. "The obstinacy of lawmakers who want to tear the safety net is infuriating."

The Tennessean reassures us that corruption is at an all time low in the food stamp program. "The department inspects thousands of stores every year and uses the Electronic Benefit Transfer system to track food-stamp purchases," they say.

While the Tennessean has passion on the issue and is good at name calling, they are really weak on logic. "But if 46 million people are cheating the government, how is it that the government hasn’t collapsed?" they ask.

What?? If 46 million people were cheating the government, the government would be no closer to collapse than if 46 million people legitimately needed the assistance. The economic impact would be the same. How hard is that to understand? Is that not basic? I know the Tennessean has had to cut their staff, but I did not know they were letting high school interns write their editorials. No wonder subscriptions are falling. 

The truth is that there is good reason to question the food stamp program. Two-thirds of the Agricultural Departments budget is now devoted to food stamps and food stamps is the nations second largest welfare program, second only to Medicaid. Some 46.4 million people are in the food stamps program. That is 1 in 7 Americans, compared to 1 in 50 in the 1970's.  In fiscal 2011, the federal government spent more than $75 billion on food stamps, up from $34.6 billion at the end of fiscal 2008, according to the USDA.

Government is advertising for people to enroll in the food stamp program. Could it be that the Obama administration sees a food stamp recipient as a probable Democratic voter?  Is it cynical to think that Democrats want more people dependent on the government?

Please don't tell me that the food stamp program is not subject to corruption. I am in a position to observe people abusing  food stamps. Here are some things I have observed.

  • A mother with a minor daughter and two grown daughters each with children of their own share a house and she gets food stamps for herself and her young daughter ($285)and each of her two older daughters gets food stamps separately. The daughter with one child gets $285 and the daughter with two children gets $408. This household of seven gets $978 a month in food stamps.
  • An unmarried couple with two children share the same home. The man works earning a salary sufficient to support his common law wife and his two children. When they apply for food stamps they do not report the fathers' income. The mother gets $408 worth of  food stamps.
  • A person "borrows" her sisters children and claims to have a household of four when she really only has a household of two and gets $518 worth of food stamps rather than $218.
  • A person has unreported income, cleaning houses, braiding hair, unreported tips waiting tables, unreported income driving a cab, cutting grass, or any number of things.  They only report the income they show on their taxes when applying for foods stamps.  They are not only getting hundreds of dollars in undeserved food stamps but also they get the earned income tax credit and get a money back, instead of paying money in, at tax time. 
  • The child's father does not live in the home and does not pay child support but voluntarily gives the mom money each month. This is not reported in calculating food stamps. 
  • Food stamps are used as currency. Food stamps are not actually issued any more. The recipient gets a debit card and a pin number. The person getting the food stamps will sell to others the use of his card. The going rate in Nashville is $100 of food stamps for $50. 
  • People will qualify for food stamps legitimately but then not report their new income when they do get a job and will continue getting food stamps long after they are ineligible. 
  • Many people receiving food stamps still spend money on junk food, cigarettes, beer, cable TV, lottery tickets, getting their nail done and other luxuries.  
The Tennessean writer of that editorial is very naive if he or she don't think what I have described is routine. While merchants are occasionally investigated for food stamp fraud, there is very little fraud investigation at the consumer level and almost no prosecution if fraud is discovered.

Did you know:
  • Millionaires are legally entitled to collect food stamps.
  • There are only 40 inspectors to oversee 200,000 merchants that accept food stamps.
  • Recipients routinely sell their benefit cards on Facebook and Craigslist.
  • Jail inmates collect food stamps.
  • Fictitious food-stamp cases consume million of dollars.
  • A $2 million lottery jackpot winner is still eligible for food stamps.
  • The USDA has vetoed all proposals from local or state governments to prevent food stamps from being used for junk food.
  • Food stamps are increasingly being redeemed at fast-food restaurants.
  • (See WSJ: The Food-Stamp Crime Wave.) 
Food stamp waste fraud and abuse also has a multiplier effect, because if one is on food stamps then the children of the food stamp recipient  are automatically eligible for free or reduced school lunches and various other assistance programs use receipt of food stamps as an automatic qualifier for program assistance.

In states with bottle deposits a new form of food stamp fraud is called "water dumping."  Food stamp recipients will purchase water and immediately poor the water down the drain and redeem the plastic bottles. (link)

In Atlanta, a local TV station caught a man buying food stamp cards in the parking lot of a grocery store, using them to purchase items in the store, and then the purchased items were used to stock the shelves in his near by convenience market.(link)

The fraud and abuse in the food stamp program is so wide spread that it is now the norm and hardly news worthy. As I see it, the fraud, waste and abuse is not as offensive as what it does to people. It creates a mentality of entitlement, criminality and dependency. It robs people of their dignity and self worth. If one sells their food stamps for 50 cents on the dollar because everyone else is doing it, then fraudulently getting public housing does not seem so wrong; gaming the system becomes the norm and then one develops an attitude of permanent underclass dependency in which it is too expensive to stop being poor.

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