Penny wise and pound foolish: Proposed SNAP budget cuts will reduce outcomes

In President Trump’s 2019 budget, he proposes changes to the Supplemental Nutrition Assistance Program (SNAP) that would significantly reduce the efficiency and efficacy of the program. This is unfortunate given the overwhelming evidence highlighting the long-term payoffs of SNAP investments, as illustrated in a recent Hamilton Project analysis which showed that SNAP benefits helped reduce health problems later in life, improved educational outcomes, lifted women’s economic self-sufficiency, and improved families immediate financial situation.

Specifically, the President’s Budget Request calls for changes that would raise administrative burdens and costs, while cutting benefits to recipients, including:

• Making a nearly 30 percent cut to the Supplemental Nutrition Assistance Program;
• Introducing new SNAP eligibility restrictions, benefit caps, and reductions; and
• Launching a “Blue Apron-type program” – except that it would deliver shelf-stable groceries (i.e., canned goods and boxed foods) to beneficiaries in partial replacement of SNAP benefits that can be spent at local retailers.

Many observers have noted that these misguided attempts at cost savings contradict not only the mission and goals of the SNAP program, but also the Trump Administration’s policy, as recently stated when it rejected Maine’s application to restrict SNAP purchases on junk food:

“When considering waiver requests, USDA focuses on moving people into self-sufficient lives, protecting the integrity of the program, and improving customer service. We don’t want to be in the business of picking winners and losers among food products in the marketplace, or in passing judgment about the relative benefits of individual food products.”

SNAP is an efficient program; as the Administration noted, its integrity should be protected.

SNAP relies on the private sector to provide access to food and beneficiaries to shop according to their needs and preferences. There is little administrative glut; more than 93 percent of SNAP is spent on food benefits. The President’s Budget Request would change the fundamental structure of the program, add costly administrative burden, and restrict the choices of beneficiaries.

Rather than cutting SNAP benefits or policing the food choices of recipients, it is worth asking: what type of policy reforms to SNAP would in fact reduce food insecurity and increase the likelihood that beneficiaries purchase healthy foods?

1. Increasing SNAP benefits

Professors Patricia Anderson (Dartmouth) and Kristin Butcher (Wellesley) found that a $30 increase in monthly SNAP benefits would increase participants’ consumption of nutritious foods such as vegetables and healthy proteins, while reducing food insecurity and consumption of fast food. Increased food expenditures are associated with more consumption of fruits and vegetables, suggesting that an increase in benefit levels could also lead to healthier eating.

In separate Hamilton Project proposals offering reforms to SNAP, Diane Whitmore Schanzenbach and James Ziliak both propose changes to the SNAP benefit formula that would increase its generosity to recipients. These reforms are motivated not only by the higher price of more nutritious food, but also by better evidence about the time available for food preparation.

2. Providing rebates for healthy food

The Healthy Incentives Pilot program was an experiment in which SNAP recipients were given an immediate $0.30 rebate on their EBT card for every $1.00 that they spent on fruits and vegetables. In response, purchases of the targeted fruits and vegetables increased by 25 percent.

Schanzenbach proposes to expand the Healthy Incentives Pilot, making the rebate for eligible fruits and vegetables part of the federal SNAP program. SNAP recipients would receive an incentive payment of $0.30 for each $1.00 spent eligible fruits and vegetables, capped at $60 per month. Eligible foods would include most fresh, frozen, canned, or dried fruits and vegetables that are packaged without added sugar, salt, fat, or oil. Leveraging existing infrastructure, the refund would be automatically credited to the EBT card at point of sale and would be available at the next transaction.

Increasing the generosity and purchasing power of SNAP benefits will improve the diets of SNAP beneficiaries. As Congress considers the President’s Budget Request in the weeks ahead and looks to reauthorize the Farm Bill, they should consider policy changes that strengthen the purchasing power of SNAP benefits without policing the food choices of American consumers.