From a small pilot program created by John F. Kennedy’s first executive order in 1961, the food stamp program (now called the Supplemental Nutrition Assistance Program, or SNAP) has grown to be the largest federal food assistance program. However, there have always been major questions about whether the hunger and nutrition goals of the program justify its design.
A good way to see the logic of SNAP supporters is to ask, ‘Why give poor people food stamps rather than money?’ Some fear that low income recipients may ‘waste’ the money for some other goods than food, and want to preclude that possibility. Agricultural and grocery interests piggy-back on the belief that food stamps will increase food demand more than giving recipients money, which promises them higher sales and profits. Politicians do the same, because they can assert greater effectiveness at reducing hunger with the funds.
Unfortunately, a major problem with that shared understanding is that money is fungible. A person can redirect money put to ones use to any other use as he or she chooses.
This post was published at Ludwig von Mises Institute on Feb 09, 2017.