Michele Simon of Eat Drink Politics just released a study entitled "SNAP: Are Corporations Profiting from Hungry Americans?" In my recent article on the Farm Bill, I touched quickly on the fact that the hunger lobby--in order to gain any traction for their programs and efforts--has historically formed alliances with "Big Food" (food retailers like Walmart and corporations like Kellogg, Nestle, and Cargill).
The Farm Bill reauthorization is steadily moving forward, with Senators and committees recommending cuts and shifts. $4.5 billion dollars of funding for SNAP--the Supplemental Nutrition Assistance Program--is on the chopping block. Senator Kirsten Gillibrand has proposed an amendment to restore cuts to SNAP by reducing crop insurance payments, but it's hard to estimate how likely this amendment is to go through. For an idea of what a $4.5 billion dollar cut actually means, I consulted Johns Hopkins' farm bill visualizer. I was somewhat surprised to see exactly how much funding food aid receives in the Farm Bill--an astonishing $71 billion! I believe that any decrease in SNAP, especially with increased funding for crop insurance, is a questionable move, but as a caveat to this article, it's important to realize that the majority of SNAP isn't being cut; the numbers break down to 2.7% from the slated Farm Bill budget, $4.5 billion over 10 years.
"The debate over making health-oriented improvements to SNAP purchases is currently at a standstill. On one side are those who insist soda is not a food, while others argue such policy changes only hurt those in need. We must go beyond this rhetoric and examine the extent to which SNAP has become a corporate subsidy. Then advocates should work together to make improvements to SNAP that will truly benefit participants."--Michele Simon
Today, 1 out of 7 Americans receive food stamp benefits. Food stamps, now called SNAP, were created as a way to aid the needy and redistribute farm surpluses and other products bought by the government to support farm prices. While specifying product purchases has always been a part of SNAP, there originally was a larger focus on produce.
In the early years of food stamps, between 1939-1964, food stamps could be used for food and household items and commodity and surplus foods, including fresh produce. Soft drinks were excluded from the program. In 1964, soft drinks and 'luxury food items' such as snacks were added to the list of approved products.
Since 1964, states and various hunger organizations have proposed nutritional improvements to eligible SNAP purchases. Big Food opposes these nutritional improvements and the reason is quite simple: they profit too much from food stamps to let circumstances change. To cite one example, Walmart receives a huge proportion of SNAP dollars; in fact, in some states, 50% of SNAP dollars spent at Walmart. The disproportionate amount of money Walmart receives from SNAP purchases raises the question of how much SNAP is subsidizing Walmart. Without further data, it's impossible to know how Walmart is contributing to the health of SNAP participants.
After Congress approves the Farm Bill budget, the USDA administers SNAP, splitting administrative costs with the state evenly. It's a complicated journey from the USDA's approval of SNAP's budget, to a person purchasing food using EBT benefits. The process requires states to enroll participants and contract with banks for EBT services, retailers to buy eligible foods (from makers like Coke and Mars) and to request payments through banks, and banks to authorize payments from the Federal Reserve.
Lobbying groups such as the National Grocers Association and the National Snack Food Association tend to fight--and block--attempts at steering food stamps onto a healthier path. For example, when Mayor Bloomberg attempted to remove soda as an eligible food item for SNAP in New York City (an attempt he made before the new soda size regulations), these giant lobbying groups fought tooth and nail to prevent the proposal from passing.
Important national organizations like Feeding America are permanently indebted to companies like Cargill, Kellogg, and Mars, who donate large sums to Feeding America and similar anti-hunger organizations. This means that efforts to rally for a healthier focus on food stamp benefits are shut down as quickly as they start.
Making matters more complicated, retailer-specific and product-specific data on SNAP dollars is mostly hidden. Congress doesn't require data collection on specific SNAP product purchases.