The Food Stamp President: Welfare Reform Needed

May 4, 2012 by

by Henry W. Burke

5.04.12

Introduction

Here is the government’s dirty little secret:  Census officials ignore most welfare programs (such as food stamps, public housing, Earned Income Credit, etc.) when they count income of “poor” people.

Now for the zinger: During Obama’s three years in office, he has increased welfare spending 3 times faster than prior welfare increases.

Under Obama, food stamp spending has more than doubled, going from $39 billion in 2008 to $81 billion in 2012.

About half of the aid goes to individuals who have received aid for 8.5 years or more.

The 45 million people on food stamps equate to 1 in 7  U.S. residents.

[That is why Obama has become known as the “food stamp President.”]

Government programs for poor and lower-income people (called “means-tested welfare”) are costing taxpayers hundreds of billions of dollars each year.  In fiscal year 2011, total welfare costs equaled $927 billion ($717 billion from the federal government and $210 billion from states).

Our country has spent huge sums of money on welfare over the years.  Since the War on Poverty began in the 1960s, the government has spent $19.8 trillion (inflation-adjusted) to fund a growing list of welfare programs.  Robert Rector, Senior Fellow at The Heritage Foundation, deduced, “This is nearly three times the cost of all military wars in U.S history from the Revolutionary War through the current war in Afghanistan.

http://budget.house.gov/UploadedFiles/rectortestimony04172012.pdf

In a hearing on April 17, 2012, headed by House Budget Committee Chairman Paul Ryan (R–WI), Robert Rector discussed the major growth in welfare costs and how to get spending under control.  Rector pointed out that the welfare reforms of 1996 did not stop “welfare as we know it.”  In fact, means-tested welfare spending has expanded considerably since then.

http://blog.heritage.org/2012/04/20/welfare-tackling-the-fastest-growing-part-of-government-spending/

Means-tested welfare programs include those benefits that are provided only to poor and lower-income persons (e.g., food stamps, public housing, Medicaid, and Temporary Assistance to Needy Families).

By contrast, non-welfare programs provide benefits and services for the general population at all income levels. These programs include Social Security, Medicare, police protection, and public education.

A.  Growth of Welfare Spending

Many people think welfare was successfully reformed and that there is no problem with the current welfare system.

When President Clinton signed the landmark welfare-reform legislation in 1996, he said it would “end welfare as we know it.”  The legislation was a success, but it only restructured one federal welfare program — Aid to Families with Dependent Children.  Meanwhile, state and federal welfare spending has doubled since 1996.

Total means-tested welfare spending (federal and state) has been doubling each decade, going from $0.47 trillion in the1969-1978 decade to a projected figure of $10.3 trillion in the 2009-2018 decade.

http://www.heritage.org/research/reports/2010/06/confronting-the-unsustainable-growth-of-welfare-entitlements-principles-of-reform-and-the-next-steps

Welfare spending has been the fastest-growing part of government spending for the past two decades.  For the Fiscal Year 1989 to FY 2008 time period, the percentage increase in annual spending has been:

Percent Increase in Annual Spending

(FY 1989 – FY 2008)

 

Program PercentIncrease
Means-tested Welfare +292 %
Social Security & Medicare +213 %
Education +143 %
Defense +126 %

 

 

 

Here is the zinger: During Obama’s three years in office, he has increased welfare spending 3 times faster than prior welfare increases.

 

 

Supporters of Obama’s increase in welfare spending might suggest that these spending increases are merely the result of the current recession.  That is not the case; most of Obama’s increases are permanent expansions of the welfare state.  This is borne out by the long-term spending plans set forth in Obama’s 2013 Budget.

 

Federal spending on welfare or aid to the poor hit a record high $613 billion in FY 2009.  By Fiscal Year 2011, federal spending had grown to $717 billion; total federal and state spending was $927 billion.

[$717 billion federal spending plus $210 billion state spending = $927 billion total spending]

 

Total means-tested welfare spending in recent years has been:

 

 

Means-Tested Welfare Spending

 

Fiscal Year Federal State Total
FY 2007 $469 billion $189 billion $658 billion
FY 2008 $522 billion $192 billion $714 billion
FY 2009 $613 billion $167 billion $780 billion
FY 2010 $695 billion $193 billion $888 billion
FY 2011 $717 billion $210 billion $927 billion

 

http://budget.house.gov/UploadedFiles/rectortestimony04172012.pdf

 

 

The only federal program larger than Welfare (at $717 billion) is Social Security (at $731 billion).  Actual 2011 expenditures (outlays by budget function) show that Welfare spending is larger than Defense (at $705 billion) and Medicare (at $486 billion).

 

http://www.cbo.gov/sites/default/files/cbofiles/attachments/Supplemental_byFunction.xls

 

 

 

B.  Scope of Welfare Programs

 

 

1.  Overall Scope

 

The governmental safety net has three basic components: (1) Social Security and Medicare for the elderly; (2) unemployment insurance and worker’s compensation; and (3) anti-poverty or means-tested welfare programs.  The means-tested welfare system consists of 79 federal programs providing cash, food, housing, medical care, social services, training, and targeted education aid to poor and low income Americans.

 

Rector recently testified (4.17.12) before the House Budget Committee.  He explained that:

 

The 79 means-tested programs operated by the federal government provide a wide variety of benefits. The federal welfare state includes:

 

          12 programs providing food aid;

12 programs funding social services;

12 educational assistance programs;

11 housing assistance programs;

10 programs providing cash assistance;

9 vocational training programs;

7 medical assistance programs;

3 energy and utility assistance programs; and,

3 child care and child development programs.

 

http://budget.house.gov/UploadedFiles/rectortestimony04172012.pdf

 

 

2.  Food Stamps

 

Two of the largest federal welfare programs today are food stamps and public housing assistance. The Food Stamp program (Supplemental Nutrition Assistance Program or SNAP) is the federal government’s largest food assistance program. It is a quasi-entitlement that pays states for nearly every person who enrolls in the program.

 

Under Obama, food stamp spending has more than doubled, going from $39 billion in 2008 to $81 billion in 2012.  Food stamp expenditures are as follows:

 

Food Stamp Expenditures

 

Year Food StampSpending
2008 $39 billion
2009 $56 billion
2010 $70 billion
2011 $78 billion
2012 $81 billion
2013 $82 billion

 

http://blog.heritage.org/2012/04/23/food-stamp-participation-the-highest-ever-and-growing/

 

 

Although nearly all food stamp households contain working-age adults, few of these individuals are employed. The food stamp program fosters a pattern of long-term dependence.  About half of the aid goes to individuals who have received aid for 8.5 years or more.  The percent of total food stamp spending breaks down as follows:

 

 

Food Stamp Spending Break-down

 

Duration ofDependence Percent ofSpending
Less than 1 Year   3.4 %
1-2 Years   6.2 %
2-5 Years 20.8 %
5-10 Years 28.9 %
10+ Years 40.8 %

 

http://www.heritage.org/research/reports/2010/06/confronting-the-unsustainable-growth-of-welfare-entitlements-principles-of-reform-and-the-next-steps

 

 

Under Obama, the number of people on food stamps has grown from 31 million in 2008 to 45 million in 2011.  The 45 million people on food stamps equate to 1 in 7  U.S. residents.

[That is why Obama has become known as the “food stamp President.”]

http://www.cbo.gov/sites/default/files/cbofiles/attachments/04-19-SNAP.pdf

 

 

3.  Housing Assistance

The U.S. Department of Housing and Urban Development (HUD) runs three primary housing programs that provide assistance to low-income citizens.  These programs subsidize the rent of about 4 million low-income households annually. According to the Office of Management and Budget, housing assistance programs are scheduled to spend $235 billion overall during the next five years.

Because no time limits or work requirements are associated with any of these programs, recipients have no incentive or urgency to find employment or leave the rolls.

 

 

C.  The Hidden Welfare State

 

In his Congressional testimony, Robert Rector pointed out that typical discussion of government spending assumes that the federal budget consists of four principal parts: (1) entitlements (meaning Social Security and Medicare); (2) defense; (3) non-defense discretionary spending; and (4) interest.

 

This perspective is misleading because it ignores the hidden welfare state: a massive complex of 79 federal means-tested anti-poverty programs.  Rector stated:

 

          The public is almost totally unaware of the size and scope of government spending on the poor. This is because Congress and the mainstream media always discuss welfare in a fragmented, piecemeal basis. Each of the 79 programs is debated in isolation as if it were the only program affecting the poor. This piecemeal approach to welfare spending perpetuates the myth that spending on the poor is meager and grows little, if at all.

 

            The piecemeal, fragmented character of the hidden welfare system makes rational policy-making and discussion impossible. Sound policies to aid the poor must be developed holistically, with decision makers and the public fully aware of the magnitude of overall spending.

 

http://budget.house.gov/UploadedFiles/rectortestimony04172012.pdf

 

Rector is saying that Congress does not view welfare spending in its entirety.  When Congress looks only at a program here or a program there, this perpetuates the myth that welfare is relatively small.  Congress must focus on the overall scope of welfare to understand its immense size and curb rapidly expanding welfare costs.

 

 

 

D.  Poverty’s Catch 22 Gimmick

 

It is becoming common place to read articles or watch TV programs where “poor” people have cars, air conditioners, multiple color televisions, cable TV, Xboxes, PlayStations, cell phones, microwaves and many other expensive items.  How can people living in these abundant conditions be classified as “poor” in this country?  It is a statistical gimmick.

 

The government employs a clever “Catch 22” gimmick to mislead the public about poverty in America.

 

http://www.heritage.org/research/commentary/2011/07/catch-22-on-poverty-and-welfare

 

Robert Rector explained and exposed this ploy in a 2011 article in which he stated that because the U. S. Census Bureau found that more than 35 million Americans were living in poverty (2010), the government concluded that 1 in 7 Americans were poor. However, this assumption was based upon a definition of “poor” if a family’s income for a family of four was below $22,314.

 

 

http://www.census.gov/hhes/www/poverty/data/threshld/thresh10.xls

 

 

Here is the government’s statistical gimmick:  Census officials ignore most welfare programs (such as food stamps, public housing, Earned Income Credit, etc.) when they count income.  In 2010, the government spent $695 billion on welfare programs but census officials counted only 6 % of this as “income” for purposes of measuring poverty.

 

This is poverty’s Catch 22: the Left complains about poverty and demands that government (taxpayers) spend more to fight it but then ignores that spending when it counts the poor!

 

Liberals do the same thing with class warfare and “income inequality.”  The rich are taxed to transfer money to the poor, but those billions of dollars are not counted when the government measures inequality.

 

This dirty little secret needs to be exposed and the practice stopped.  We need accurate and honest data on poverty in America from the point of view of the recipient of these benefits.  In turn, this will help us control welfare costs.

 

 

 

E.  Recommendations for Welfare Reform

Our government is broke and is running record deficits and debt.  The National Debt stands at $15.7 trillion ($15.680 trillion on 5.02.12), and our annual deficits of over $1.3 trillion are compounding the problem.  Obama has added $5.1 trillion to the National Debt in 39 months!

Last year, the federal government spent $3.6 trillion and had revenue of $2.3 trillion; this produced a $1.3 trillion deficit for FY 2011.  We simply cannot continue this irresponsible spending!

 

http://www.treasurydirect.gov/NP/NPGateway

 

http://www.cbo.gov/publication/42905

 

As government spending on means-tested welfare approaches $1 trillion per year, it is time to rework the poverty programs to control costs and promote greater self-reliance.  In addition, efforts to rebuild marriage in low-income communities would improve the well-being of children, parents, and communities.

The Heritage Foundation has formulated a welfare reform plan based on these five principles as quoted below:

1.  Slowing the growth of the welfare state.   Congress needs to establish reasonable fiscal constraints within the welfare system. Once the current recession ends, aggregate welfare spending should be rolled back to pre-recession levels. After this rollback has been completed, the growth of welfare spending should be capped at the rate of inflation.

2.  Promoting personal responsibility and work.  Able-bodied welfare recipients should be required to work or to prepare for work (for a minimum of 30 hours per week) as a condition of receiving aid.

3.  Providing a portion of welfare assistance as loans rather than as grants.  Welfare to able-bodied adults creates a potential moral hazard because providing assistance to those in need can lead to an increase in the behaviors that generate the need for aid in the first place. If welfare assistance rewards behaviors that lead to future dependence, costs can spiral out of control.

4.  Ending the welfare marriage penalty and encouraging marriage in low-income communities.   The collapse of marriage is the major cause of child poverty in the U.S. today.  When the War on Poverty began, 7 % of children in the U.S. were born out of wedlock; today, the figure is over 40 %.  Most alarmingly, the out-of-wedlock birthrate among African–Americans is 72 %.  The outcomes for children raised in single, never-married homes are greatly diminished.

5.  Limit low-skill immigration.   Around 15 % ($100 billion per year) of total means-tested welfare spending goes to households headed by immigrants with high school degrees or less. One-third of all immigrants lack a high school degree.  Government policy should limit future immigration to those who will be net fiscal contributors, paying more in taxes than they receive in benefits.

In addition, the government should not provide amnesty or “earned citizenship” to illegal immigrants, which would provide illegal immigrants with full access to the U.S. welfare system. Of the 11 million to 12 million illegal immigrants in the U.S., at least 50 % lack a high school degree. Giving this population amnesty and access to welfare would lead to a staggering increase in future welfare costs.

http://www.heritage.org/research/reports/2010/06/confronting-the-unsustainable-growth-of-welfare-entitlements-principles-of-reform-and-the-next-steps

 

Other Recommendations

It is time to apply some of the lessons learned from the 1996 welfare reform legislation.  That is why Rep. Jim Jordan (R – Ohio) advocates linking food stamps to work; those receiving food stamps should either have a job or be actively seeking one.  Rep. Jordan said  “The aim of welfare should be to help people reach the point where they no longer need it.

Careful policy reforms focused on fiscal restraint, strong work requirements, the promotion of marriage, and personal responsibility can transform the federal welfare system, reducing dependence on government and increasing the well-being of families and children.

The decline of marriage is a predominant cause of child poverty.

Roughly two-thirds of poor children reside in single-parent homes. Children born to and raised by a single parent are 7 times more likely to live in poverty than children born to and raised by a married couple.

If poor women who have children out of wedlock were married to the actual fathers of their children, nearly two-thirds would immediately be lifted out of poverty.

 

Recommendations Contained in Congressional Testimony

Robert Rector provided wise recommendations for welfare reform in his Testimony before the House Budget Committee.  One of his recommendations was to follow Principle No. 1 above.  Once the current recession ends, aggregate welfare spending should be rolled back to pre-recession levels.  After this rollback has been completed, the growth of welfare spending should be capped at the rate of inflation.

Rector concluded:

 

            This type of spending cap would save the taxpayers $2.7 trillion dollars during its first decade. 

 

            An aggregate welfare spending cap of this sort is contained in HR 1167, “The Welfare Reform Act of 2011” introduced by Congressman Jim Jordan (R-OH).

 

http://budget.house.gov/UploadedFiles/rectortestimony04172012.pdf

 

 

Conclusion

Since the War on Poverty began in the 1960s, the government has spent $19.8 trillion to fund a growing list of welfare programs.

Total means-tested welfare spending has been doubling each decade.

Welfare spending has been the fastest-growing part of government spending for the past two decades.

In fiscal year 2011, total welfare costs equaled $927 billion.

The means-tested welfare system consists of 79 federal programs providing cash, food, housing, medical care, social services, training, and targeted education aid to poor and low income Americans.

The food stamp program fosters a pattern of long-term dependence.  About half of the aid goes to individuals who have received aid for 8.5 years or more.

The government employs a clever “Catch 22” gimmick to mislead the public about poverty in America.  Census officials ignore most welfare programs when they count income.

The Heritage Foundation has formulated a detailed welfare reform plan based on five key principles.

In Testimony before the House Budget Committee, Robert Rector advocated measures to reform means-tested welfare.  These changes would save $2.7 trillion in the next 10 years.

The decline of marriage is a predominant cause of child poverty.  Roughly two-thirds of poor children reside in single-parent homes.

If poor women who have children out of wedlock were married to the actual fathers of their children, nearly two-thirds would immediately be lifted out of poverty.

The government should focus on efforts to strengthen marriage in low-income communities.

Instead of fostering government dependence, the welfare system should promote personal responsibility and accountability.  The future of our country is at stake.

 

 

 

 

Bio for Henry W. Burke

 

Henry Burke is a Civil Engineer  with a B.S.C.E. and M.S.C.E.  He has been a Registered Professional Engineer (P.E.) for 37 years and has worked as a Civil Engineer in construction for over 40 years. 

Mr. Burke had a successful 27-year career with a large construction contractor where he was a Project Engineer, Engineer-Estimator, Superintendent, Senior Engineer, and Training Manager.

Henry Burke serves as a full-time volunteer to oversee various construction projects. He has written numerous articles on education, engineering, construction, politics, taxes, and the economy. 

 

 

Henry W. Burke

E-mail:  hwburke@cox.net

Print Friendly, PDF & Email

Related Posts

Tags

Share This

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.