…a four-year study of a government-run program in northern Uganda that gave cash to groups of young people so they could learn a trade and start their own businesses. The results surprised him and convinced him that outright grants are the best way to give aid.
“I was very skeptical. I thought the money was bound to be wasted,” Blattman recalled in a recent interview on campus. “But most people used the money responsibly and there were huge economic effects.”
The data showed that after four years, most of those who received a cash grant were practicing a skilled trade, their income was up nearly 40 percent on average, and business assets increased 57 percent….
…Mr. Obama has not radically expanded the safety net. Rather, the dire state of the economy has reduced incomes and made more people eligible for benefits, especially unemployment benefits. Basically, the safety net is the same, but more people are falling into it….
…44 percent of Social Security recipients, 43 percent of those receiving unemployment benefits, and 40 percent of those on Medicare say that they “have not used a government program.”…
…the vast bulk of entitlement spending goes to the elderly, the disabled, and working families, so any significant cuts would have to fall largely on people who believe that they don’t use any government program….
…Yes, voters sent some severe conservatives to Washington. But those voters would be both shocked and angry if such politicians actually imposed their small-government agenda.
…In 1996, Gingrich succeeded as House Speaker in passing welfare “reform,” which decimated the welfare program, particularly its ability to respond during times of economic stress. Because TANF (welfare) is block-granted, it cannot increase when more people become eligible for it. As a result, SNAP became one of the easiest ways to provide needed benefits to struggling Americans. The Center on Budget and Policy Priorities writes that “SNAP’s role in the safety net has been all the more important because TANF cash assistance has not been available to many unemployed low-income families.” The 1996 welfare reform made cuts to SNAP, most of which remain. But it’s still expandable during a downturn, unlike TANF. In 2010, 40% of single mothers received food stamps, while only 10% received TANF funds. And this is why SNAP costs increased by 102% during the Great Recession.
In other words, without the “end of welfare as we know it,” nobody would likely have become a food stamp President. The closing of the welfare channel forced an opening of a separate channel to deliver benefits. I suppose the other option is to let the poor starve, which Gingrich must be advancing. But when he talks about “food stamp Presidents,” recognize that he’s responsible.
And he should be thrilled to take the credit! The US Department of Agriculture estimates that $1 spent on food stamps generates $1.79 for the economy, creating economic activity with one of the best multipliers of any federal program. Census data from 2011 shows that SNAP kept 5.1 million Americans out of poverty, including substantial numbers of women and children. It’s a great program that helps the food production industry, keeps struggling families afloat when the economy turns sharply against them, and which has an historically low error rate. Almost all of the benefits get directly to people with a tiny administrative overhead….