Even as economy picks up, food-stamp rolls expand

During the recession, the number of Americans on food stamps surged as people lost their jobs and families slipped below the poverty line. That’s not surprising — it’s how the program was designed to work.

What’s noteworthy, though, is that this trend hasn’t reversed itself, even as the economy has improved. A new analysis from Bloomberg Government finds that the number of Americans on food stamps has risen to record levels even as unemployment has dropped significantly over the past year:

It’s not clear if we’ve hit a peak yet. According to U.S. Department of Agriculture data, food-stamp rolls expanded to all-time highs in December 2011 and January 2012, the last two months on record. The rolls did decline slightly in January, suggesting that the labor market is improving even for the poorest Americans, although the past few years have seen previous (and temporary) dips in the rolls that didn’t last.

Ever since the food-stamp program was created in 1964, notes Bloomberg, rolls have expanded and shrunk in tandem with unemployment rates. But that link’s been broken recently. Why is that?

One possibility is that it’s easier to get on food stamps than ever before. The stimulus bill, for instance, allowed able-bodied unemployed adults to receive benefits for longer than three months. That provision expired in 2010, but at least 46 states have received waivers from the federal government to continue this program. (Apart from that tweak, reports USA Today, eligibility standards remain what they were before President Obama took office.)

Another factor in the increase is that more Americans who have always been eligible for food stamps are signing up. According to the Department of Agriculture, only 54 percent of those who qualified for food stamps signed up in 2002, but that number (pdf) rose to 72 percent in 2009. States are getting better at reaching out to low-income households who are eligible, and they’ve streamlined their programs to make it easier for people to apply.

The Bloomberg report is also a sign that the job market is still very far from healthy. True, unemployment fell from its peak of 10 percent in October 2009 to 8.2 percent last month. But there are still 7.7 million Americans who are working part-time and can’t find full-time employment.

Food stamps are quickly becoming a high-profile budget issue. Paul Ryan’s House Republican budget would cut funding for the program by $134 billion over the next 10 years. In a 17-page paper released yesterday, Gene Sperling, director of the National Economic Council, countered that these cuts are unnecessary, noting that food stamp rolls should shrink naturally as the economy improves. The Congressional Budget Office expects levels to fall in the next 10 years from 47 million to 33.7 million — a level still higher than in 1995, but considerably lower than today’s.