Food Stamp Use Increases, Even as Economy Rebounds

Thursday, 28 Mar 2013 01:33 PM

By Dan Weil

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The economic recovery of the past four years hasn’t put a dent in the food stamp program, as the number of users is on the rise.

And enrollment in the benefits, formally known as the Supplemental Nutrition Assistance Program (SNAP), is expected to rise again this year and then decline only gradually over the next few years, The Wall Street Journal reports.

The weak job market and an increase in poverty play the biggest role in boosting food stamp participation numbers. But another factor is that states are guiding their citizens to get on the food stamp gravy train, which is financed by the federal government, according to the newspaper.

Editor's Note: 'It’s Curtains for the US' — Hear Unapologetic Warning from Prophetic Economist.

And under the 1996 welfare reform law, states can loosen asset and income qualifications for food stamp applicants, which the Obama administration has encouraged. The idea is to let people into the program before they fall into poverty.

As for the numbers, enrollment in SNAP soared 70 percent to 47.8 million in December 2012 from 28.2 million four years earlier, The Journal reports.

And the Congressional Budget Office predicts that SNAP enrollment will drop only 9 percent, to 43.3 million people, over the next four years, while unemployment drops 27 percent — to 5.6 percent from 7.7 percent last month.

Food stamp enrollment is all about jobs, says Peter Cardillo, chief market economist at Rockwell Global Capital.

"The unemployment data is not really telling us the true story of how many people are underemployed," he tells CNBC. Food stamps are "a good indication of how the income of the work force has stagnated and more and more people are applying for food stamps."

Editor's Note: 'It’s Curtains for the US' — Hear Unapologetic Warning from Prophetic Economist.

© 2014 Moneynews. All rights reserved.

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