SNAP Caseloads Down — as Expected

September 2, 2014 at 3:20 pm

“Food Stamp Use Starting to Fall,” the Wall Street Journal points out, noting that SNAP (formerly food stamp) caseloads have fallen by 1.6 million people since their 2012 peak and that the Congressional Budget Office predicts SNAP spending will drop to its 1995 level as a share of the economy in five years.

As we’ve explained, SNAP caseloads grew dramatically during the recession and stayed high due largely to a weak labor market.  As the economy began to recover, caseload growth began to flatten and then fall (see graph), a pattern consistent with past recessions.

Most states’ SNAP caseloads this May were below last May’s levels, the latest Agriculture Department data show (though caseloads were flat or somewhat higher in roughly a dozen states).

The WSJ story gives several examples of former SNAP recipients who’ve since left the program:

One beneficiary-turned-former-beneficiary is Louis Alexander.  Mr. Alexander turned to food stamps last year after losing his job as a maintenance man.  A year later, he is working again — as a truck driver for a company near his home in Louisville, Ky.

He credits food stamps for helping him eat and pay his other bills while job searching. . . .

For Jessica Singh, an unmarried mother who stopped using food stamps this spring, things are generally looking up.

After being dependent on SNAP for over two years, the 26-year-old in Fort Wayne, Ind., got a degree in human services, found internships and has landed two part-time jobs, including one at a domestic-violence shelter. Food stamps “definitely gave me a sense of stability,” she said.  “You know there is going to be food on the table.”

And yet it isn’t easy going without SNAP’s safety net.  If her 2-year-old gets sick and Ms. Singh can’t work, her income takes a hit.  Last month, Ms. Singh visited a food pantry for the first time, picking up free boxes of pancake mix, cereal and Hamburger Helper, along with toilet paper.  She said she will go earlier next time; by the time she got there during her first trip, items like bananas and hamburger meat were gone.

For more on SNAP, including cost and caseload trends, who’s eligible, and its impact, see our chart book.

In Case You Missed It…

August 29, 2014 at 12:25 pm

This week on Off the Charts, we focused on the federal budget and taxes, state budgets and taxes, health care, food assistance, and the economy.

  • On the federal budget and taxes, Chuck Marr pointed to IRS Commissioner John Koskinen’s comments about the potential “catastrophic” effects of House-passed IRS funding cuts to taxpayer services. Will Fischer argued that while House Budget Committee Chairman Paul Ryan’s endorsement of House Ways and Means Committee Chairman Dave Camp’s plan to limit the mortgage interest deduction is moving in the right direction, greater changes are needed.
  • On state budgets and taxes, Michael Mazerov discussed further evidence that state income taxes have little to do with where people choose to live.
  • On health care, Jesse Cross-Call noted that Wisconsin’s and Wyoming’s budget reports show that their failure to adopt health reform’s Medicaid expansion is costing them millions of dollars in forgone budget savings.
  • On food assistance, Becca Segal urged eligible school districts to adopt community eligibility before the upcoming August 31 deadline.
  • On the economy, we highlighted key facts about the minimum wage.

We released an explainer on the minimum wage. We also updated our backgrounder on how many weeks of unemployment compensation are available from state to state and our chart book on the legacy of the Great Recession.

CBPP’s Chart of the Week:

A variety of news outlets featured CBPP’s work and experts recently. Here are some highlights:

The Number of Homeless Veterans Really Is Falling
FiveThirtyEight
August 27, 2014

The Myth of ‘Out of Control’ Disability Benefits
U.S. News & World Report
August 22, 2014

Don’t miss any of our posts, papers, or charts — follow us on Twitter and Instagram.

 

The Basics of the Minimum Wage

August 29, 2014 at 11:00 am

As Labor Day approaches, it’s worth taking a closer look at the important role that the minimum wage plays for millions of workers nationwide, its contribution to the economy, and how it could be strengthened.  Our new Policy Basic explains these key facts.

The federal minimum wage — the lowest hourly rate an employer can legally pay workers under the law — is now $7.25.  Where states and municipalities have enacted their own higher minimum wage laws, employers must pay at least the state or local minimum.  As of August 1, 2014, 23 states and the District of Columbia have minimum wages above the federal minimum wage.

In 2013, 5.5 million workers earned within 25 cents of the federal minimum wage, according to the Congressional Budget Office.  Three-quarters of these workers were at least 20 years old and two-fifths of them worked full time.  The median family income of workers in this range was about $30,000.

President Obama proposed raising the minimum wage to $9 an hour in his 2013 State of the Union address.  More recently, the Administration announced its support for the Fair Minimum Wage Act, which would raise the hourly minimum wage from $7.25 to $10.10 over the course of two years.  After that, the minimum wage would be indexed to inflation, eliminating the gradual erosion of minimum wage workers’ purchasing power (see chart) and the need for periodic, potentially contentious legislative debates to restore it that have been a feature of the minimum wage since its inception.

Although standard supply and demand theory suggests that an increase in the minimum wage reduces employment, empirical studies generally find that any such employment effects are modest.  Some studies have found no impact or even an increase in employment — at least for minimum-wage increases within the range of historical experience and those contemplated in recent proposals.

Click here to read the full backgrounder.

CBPP

Counting Down to August 31 Deadline to Adopt Community Eligibility

August 28, 2014 at 1:20 pm

Schools have a few more days before the August 31 deadline to opt in to the Community Eligibility Provision.  Community eligibility — which allows high-poverty schools to offer breakfast and lunch to all students at no charge without having to process meal applications —is a proven success and an important tool to help children achieve their academic goals.  More than 28,000 schools nationwide are eligible to adopt the provision and become hunger-free.

The U.S. Department of Agriculture (USDA) has encouraged states to continue to accept applications after the deadline and even after the school year begins.  During this transition year, schools can still implement community eligibility even if they have disseminated and collected free and reduced-price meal applications, according to USDA’s July 2014 Guidance.  The sooner they adopt the provision, however, the sooner they will be able to cut back on paperwork, receive reimbursement according to the community eligibility formula — and make meals more readily available to all students.

Community eligibility allows high-poverty schools to ensure that students are ready to learn and receive two nutritious meals every day.  Schools can receive more information on their individual state’s application process by contacting their State Nutrition Director.

Wisconsin and Wyoming Tally Fiscal Cost of Rejecting Health Reform’s Medicaid Expansion

August 28, 2014 at 12:00 pm

Recent budget reports from Wisconsin and Wyoming show that their failure to adopt health reform’s Medicaid expansion is costing them millions of dollars in forgone budget savings.

In Wisconsin, the legislature’s nonpartisan Legislative Fiscal Bureau estimates that the expansion, which covers non-elderly adults with incomes up to 138 percent of the poverty line, would have saved the state $206 million in the 2014 and 2015 fiscal years combined.

Governor Scott Walker chose instead to extend Medicaid coverage to adults only up to 100 percent of the poverty line through a separate waiver.  This means that the federal government is paying for the expanded coverage at the state’s regular Medicaid matching rate of 59 percent, rather than the much higher matching rate for health reform’s Medicaid expansion.  (For states that expand to 138 percent of poverty, the federal government will pick up 100 percent of the cost through 2016 and no less than 90 percent thereafter.)  The difference in matching rates is the main reason for the $206 million in forgone savings.

Wisconsin could still save between $261 million and $315 million over the 2016 and 2017 fiscal years by adopting the expansion during next year’s legislative session, the report estimates.  Gov. Walker has justified his opposition to it by arguing that the federal government would ultimately renege on its financial commitment, but those fears are unfounded.

In Wyoming, the state health department projects that the Medicaid expansion would save the state $50 million a year on other health programs for low-income uninsured residents.  As a result, Governor Matt Mead is moving to advance the Medicaid expansion during the coming legislative session.  More than 17,000 uninsured residents would gain access to coverage under the expansion, the Urban Institute estimates.

The 27 states (including Washington, D.C.) that have adopted the Medicaid expansion are already seeing dramatic gains in health coverage and reductions in the cost of providing uncompensated care to the uninsured.  Wisconsin, Wyoming, and the other 22 states that have not done so could realize similar benefits.