The "good news'' from an economic standpoint is that food stamps are a terrific vehicle for stimulus, because recipients spend them quickly. A 2008 Moody's study found that the fastest way to infuse money into the economy (thus generating a quick multiplier effect) is by expanding this program!
So why cut food stamps as our economic recovery is suddenly faltering? The short answer is because Republicans insisted on it. Republicans compelled the cuts by insisting that any new spending measures, even on something as seemingly unobjectionable as saving teachers' jobs, be "offset'' in the budget. A grim necessity, they claimed, to prevent the deficit from killing the recovery.
"It was a lousy offset,'' said Democratic Representative Jim McGovern of Worcester, the co-chairman of the House Hunger Caucus. "We're robbing Peter to pay Paul.''
The justification offered by proponents was that food prices haven't risen as much as Congress expected them to, and therefore cutting benefits to hungry kids isn't really so bad, especially since the cuts won't take effect until 2014. The trouble is, forecasts aren't very rosy: It is projected that food stamp recipients will increase to 43.3 million next year, and beyond that, who knows? "President Obama pledged to end childhood hunger by 2015,'' McGovern pointed out. "It's hard to see how you do that while you're cutting food stamps.''
Faced with imminent layoffs, Democrats had little choice but to act, and that meant cutting something. But the idea that they've won anything overall is hard to sustain. They sacrificed the most effective form of stimulus and capitulated to the Republican idea that deficits matter above all else. Their decision about who should bear the brunt of the offsets, and the silence that greeted it, suggests a moral capitulation as well.
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