Proposed Congressional Cuts to Nutrition Assistance Would Cost Jobs
The House will vote on a measure to repeal the estate tax, which would shower the wealthiest 0.2 percent of estates in the country with an average tax cut of $2.5 million. Meanwhile, the House has already passed a budget proposal that would convert the nation’s bedrock nutrition assistance program—the Supplemental Nutrition Assistance Program, or SNAP—into block grants to the states. If implemented, this conversion would result in $125 billion in cuts to struggling families between 2021 and 2025.
This draconian proposal would kick up to 12 million people off of food assistance or cut nutrition benefits that primarily serve children, seniors, people with disabilities, and working families by an average of almost $55 per person per month. In doing so, this proposal would also cost the economy hundreds of thousands of jobs. In fact, assuming the cuts are evenly distributed across the five years between 2021 and 2025, an updated analysis of a 2012 Center for American Progress study estimates that the House’s proposed cuts to nutrition aid would cost the economy 286,000 jobs in the first year alone.*
As families have less to spend on food, that reduced purchasing power ripples through the economy, translating into job losses not just in grocery and retail stores, but also in trucking, warehousing, food manufacturing, farming, and other industries. These cuts will hit younger workers harder because they account for a disproportionate share of workers in food-related industries.
In this way, the House Republican budget proposal presents a double hit to struggling families: It would exacerbate hunger and poverty by limiting families’ ability to purchase food, but it would also cut off pathways to the middle class by causing hundreds of thousands of job losses concentrated among young workers who are trying to gain their footing in the economy.
It doesn’t have to be this way. The same House that is claiming it needs to cut $125 billion in nutrition assistance for struggling families in order to balance the budget has also planned a vote for next week to repeal the estate tax, giving just 5,400 of the country’s wealthiest estates an average tax break of $2.5 million. The price tag of repeal over 10 years is $269 billion, or more than double the cost of the proposed cuts that could drop up to 12 million people from basic nutrition assistance. In fact, just one week of the proposed estate tax cuts for millionaires could feed more than 337,000 children for an entire year.**
SNAP has a long history of protecting struggling families from hunger and improving long-term outcomes for children and families. Last year, it lifted 5 million people out of poverty, and research shows that it plays a role in boosting long-term health outcomes, educational attainment, earnings, and income for girls over the long term. Congress can invest in jobs and protect a program with a long history of reducing hunger and hardship, but it all comes down to priorities and choices.
Melissa Boteach is the Vice President of the Poverty to Prosperity Program at the Center for American Progress.
* These estimates are based on a 2012 analysis showing that every $1 billion in SNAP cuts results in approximately 13,718 jobs lost. Based on conversations with Heidi Garrett-Peltier, a co-author of that study, this updated analysis factors in labor productivity gains and modifies the employment estimates per $1 billion to 11,437 jobs lost. Because the production functions, costs of labor, and other inputs could change over the next five years, these numbers are an approximation.
** This estimate was calculated by dividing the one-year average cost of estate tax repeal—$26.9 billion—by 52 weeks for an average weekly cost to the U.S. Treasury Department of $517 million. The average food stamp benefit per meal is $1.40, and at 3 meals per day and 365 days per year, the average SNAP cost to feed a child for one year is $1,533.
Reprinted with permission from The Center for American Progress