Trump Calls for Privatizing Food Stamps

Written by SK Ashby

Buried deep in Trump's budget proposal for fiscal 2019 is a section that calls for converting the Supplemental Nutritional Assistance Program (SNAP), or "food stamps," into a program that delivers food to the poor rather than gives them money to buy food.

Under the proposal, which was announced Monday, low-income Americans who receive at least $90 a month — just over 80 percent of all SNAP recipients — would get about half of their benefits in the form of a "USDA Foods package." The package was described in the budget as consisting of "shelf-stable milk, ready to eat cereals, pasta, peanut butter, beans and canned fruit and vegetables." The boxes would not include fresh fruits or vegetables.

Currently, SNAP beneficiaries get money loaded onto an EBT card they can use to buy what they want as long as it falls under the guidelines. The administration says the move is a "cost-effective approach" with "no loss in food benefits to participants."

Many people expressing their opinions about this right now have focused on the inhumanity of the proposal. Indeed, my own initial reaction was that Trump is calling for establishing the ultimate "nanny state" that not only tells people what they're allowed it eat, it even delivers it to them.

After thinking about it overnight, however, I believe the economic implications are far bigger. They're also the reason why Congress will never go for this.

For example, if the USDA delivers a box of canned food to your door, who decides what goes in the box? Who decides which corporations are allowed to put something in the box? Who will assemble the box? Who will deliver it?

The food stamp program is one of the most fiscally stimulative programs the government has, resulting in nearly $1.70 in economic activity for every one dollar spent on the program. In fact, the program was originally created to subsidize the agricultural industry and it still fulfills that mission today while also feeding the poor.

If only a small number of corporations or producers are selected to contribute to Trump's food box through what amounts to a private subsidy, what happens to the rest of the agricultural industry? What happens when industries in one senator's state are shut out while industries in another senator's state are contracted for the box?

If local residents receive a box of food at their door, what happens to the local groceries that depend on the business generated by food stamp recipients who would ordinarily shop in their store?

The Trump regime may describe this as a "cost-effective approach" but if you think this sounds cheaper than simply letting people buy their own food, you don't know how anything works. The overhead, administrative cost of operating this program, including packaging and shipping, would almost certainly be higher than the cost of the food itself.

White House Budget Director Mick Mulvaney compared Trump's food box proposal to meal kits delivered by Blue Apron, but that's an insult to Blue Apron. Blue Apron actually delivers fresh fruits and vegetables in cold boxes; Trump is calling for delivering cans of creamed corn and Popeye Spinach to your door.

Industry lobbyists are probably already burning up the phones in Congress to whip against Trump's proposal and, at least in this case, I have to agree with the lobbyists.