Food Stamp Nation

Pages: 1 2

Despite a new Congressional Budget Office (CBO) report finding a record number of Americans receiving food stamps, the Obama administration is working overtime to enroll more people into a program increasingly rife with fraud and abuse

According to the CBO, a record 45 million Americans (one out of every seven people) are now receiving assistance from the Supplemental Nutrition Assistance Program (SNAP), a 70 percent increase in participation since 2007.

While it should be noted that the Bush administration increased participation in the food stamp program by 63 percent during its eight years, enrolling nearly 11 million people, the Obama administration has taken that number to staggering new heights, enrolling nearly the same number of people in only three years.

Since 2007 spending on SNAP has also ballooned from $30 billion to $72 billion, an increase of 135 percent.  Moreover, the CBO estimates that spending on the program will continue to increase to $82 billion by 2013.

Eligibility for SNAP, which is administered by the US Department of Agriculture (USDA) but whose benefits are distributed by the states, necessitates that a person’s income must be near or at the national poverty level.

As such, the CBO reports that roughly 65 percent of the skyrocketing growth in the number of participants and program costs can be attributed to a stagnant economy; 20 percent due to higher benefit amounts passed in the American Recovery and Reinvestment Act of 2009; and 15 percent from other factors, such as higher food prices.

Begun in 1964 as a temporary food aid program for low-income adults and children, the food stamp program has nevertheless exponentially grown to become more of a permanent entitlement with half of food stamp aid actually going to individuals who have received the aid for 8.5 years or longer.

While most of SNAP’s participants faithfully abide by the program’s guidelines, it’s not surprising to find that its dramatic growth has also witnessed a correspondingly high swelling in the number of cases of fraud, corruption and abuse by crooks and hustlers.

That sentiment was recently shared by USDA Inspector General Phyllis Fong when she testified in March before the House Committee on Oversight and Government Reform.

According to Fong, the USDA since 2007 has launched 779 probes that had resulted in 1,356 indictments, 944 convictions and 792 sanctions against individuals and businesses that had cheated the program out of more than $200 million.

The most common type of fraud, according to Fong, is food-stamp trafficking where retailers encourage food-stamp recipients to use their Electronic Benefits Transfer debit card to trade their benefits for cash, alcohol or cigarettes, an illicit activity that can garner the retailer up to $50,000 a month.

That type of fraud was on display when Pat Lu, a mini mart owner in Massachusetts, was recently arrested as the ringleader of a $700,000 scheme involving at least 53 suspects engaged in trading food stamp benefits for cash.

Over a period of two years, Lu would swipe a customer’s SNAP debit card, ring up a phony sale for the value of the card, give the customer 50 cents on the dollar in cash, and pocket the rest, netting Lu $30,000 per month.

However, uncovering that type of fraud has become increasingly problematic given that the USDA has only 40 inspectors to oversee the 231,000 retailers nationwide that have been approved to participate in SNAP.

For example, the USDA has each year since 2002 removed an average of 830 retailers for food stamp trafficking, including ousting more than 1,200 stores in 2011. However, a recent investigation found that of the 4,600 retailers from 2006 through 2011 who had been permanently disqualified from accepting food stamps, 1,492 continue to participate in the program.

Of course, crooked retailers are abetted by equally crooked food stamp beneficiaries, witnessed by myriad reports of food stamp recipients selling their SNAP benefit cards on Facebook and on Craigslist.

Moreover, in her appearance before the House Committee, Phyllis Fong testified that many food-stamp recipients also use proceeds illegally netted from their food stamp benefit to buy illegal drugs, weapons and prostitutes.

Unfortunately, thousands of people who are not eligible for food stamps are still able to get them by lying or using the social security number of dead people, an activity highlighted by a USDA report that found the states of Maryland and Virginia having distributed $130 million in food stamps in 2010 to individuals who were not eligible.

Pages: 1 2

  • Ken

    Imagine what he can accomplish with another four years!! Scary!!

  • Gamaliel

    The argument that food stamps are "the most direct stimulus you can get in the economy during these tough times. is an absurd argument that the Obama administration and it's defenders keep repeating in one form or another.The argument that food stamps are "the most direct stimulus you can get in the economy during these tough times.” is an absurd argument that the Obama administration and it's defenders keep repeating in one form or another.

    The problem with this rationalization is that money for food stamps must come from somewhere an inconvenient fact that the Obama administration neglects to tell you. Obama likes to say that trickle down economics is false when it is has been the source of American prosperity in the past at the same time as his administration argues for "trickle up welfare".

    The problem with the "trickle up welfare" idea is that the money for trickle up welfare has to come from somewhere and that somewhere is either printed money which devalues everyone's money, or borrowing which simply delays and augments the economic disaster or from taxes. It takes away wealth from those who would invest that wealth into creating more wealth. It creates the incentive not to create wealth why should anyone work if that reduces their ineligiblity for food stamps? What it does do is increase Obama's chances of winning the next election. The more people there are dependent on food stamps the more people there will be who are afraid they will lose those food stamps if they vote Republican.

    so you are switching one form of spending for another so that the overall simulus is zero. In fact you are taking money away from investors who might have created wealth instead of consumed it. You also create dependency so that those on food stamps have less incentive to work. Why work for food if you can get it for free? This policy increases Obama's chances of reelection since those on food stamps will be afraid that the Republicans will take those food stamps away. Normally market forces would bring down the price of food if people have less money to pay for it but by providing food stamps the food prices stay higher and those who earn money have to pay more for food.

  • Taxed Enough

    Food Stamps – the new unearned money.

    • ctyankee

      The intent of the "Food Stamp" program is to make sure that all Americans have enough to eat. It is also considered a type of price support for American farmers.

      Since when did they convert from paper food coupons to debit cards? Why are holders allowed to take a cash advance on their SNAP debit cards? That is the worst form of abuse of the program.

  • Swatty Jim

    The more people get on food stamps, the more that WANT TO BE ON FOOD STAMPS. The food stamp program is turning into a feeding frenzy and in the long run is also destined to fail. Just like everything else the Govt. takes over and runs into a ditch. Soon everyone will be on food stamps, and the whole Govt. can implode, which is fine by me. They rape us day in and day out, yet never ever say what programs they are going to cut. We send Billions of tax dollars a year to every corner of earth, including to our enemies. Yet no one in congress says anything! A true travesty. Our enemies are laughing all the way to the bank. Our inept Govt. is to blame 100%. I am sick of it and I'm sure many of you will agree with me. I say flush 'em all.

    There, I said it (stealing a line from Mark Levine).

    • WilliamJamesWard

      What is the end of the governmnt program, yes everyone ends up on it in a Socialist/Marxist
      system and then it happens, when there is no other way to get food, certan undeserving
      people get cut off. Totalitarianism starts somewhere and grows, we are looking at the
      movement gaining speed. November must return America to some form of normalcy
      and demand that work return to Americans and our Industrial base restored. Honesty
      and self pride have been undermined by the disolute leftist insurgency within our
      government and institutions. I see healthy people on food stamp, and staying there
      as a debased human character is a leftist achievement, not charity, not healthy.
      We may become just another failed Natio with eletes and peasants………….William

  • kafir4life

    But they're FREE!!!! FREE!!!!!
    (there! I just became a liberal)

  • BS77

    Food Stamps are basically barter for votes…..

  • Gamaliel

    Why stop at food stamps? Why not stimulate the economy by giving everyone a million dollar stipend every month? Agriculture Secretary Vilsack says that "If people are able to buy a little more in the grocery store, someone has to stock it, package it, shelve it, process it, ship it. All of those are jobs." Well imagine how many jobs would be created if you gave everyone a million dollars a month instead of some lousy food stamps Mr. Vilsack. If something is obviously wrong with my argument which there is, the same applies to yours Mr. Vilsack.

  • Lauryn

    Yes, yes, because the only people who get food stamps are the ones who abuse them and the system. You people are so naive. Yes, we all agree that food stamps shouldn't be used for long periods of time and only when people truly need them. But you guys are making this black and white. You make it sound like every last person who is on these stamps wants some free hand outs.