Hunger rates plummet after two rounds of stimulus

The rate of American adults in households struggling with food has fallen more than 40 percent since its peak in December – a fact that Democrats are touting as evidence that hundreds of billions of dollars in direct incentives work as intended. as they are calling for another massive package despite growing GOP opposition to more spending.

The Republicans have long tried to downsize government aid programs such as food stamps, but the Democrats see the current crisis as an opportunity to fully expand the social safety net.

The pandemic is the first time that the federal government is tracking in real time exactly how households are doing during an economic crisis. The Census Bureau conducted bi-weekly polls to investigate how Americans are doing on a variety of issues, including household debt, missed rent, and whether they’ve recently gone to a grocery bank.

With all of this data, Washington learns that people who give money feed their families.

“I think it shows the wisdom of the rescue plan,” said Agriculture Minister Tom Vilsack in an interview. “That kind of support makes a difference. This is a pretty dramatic drop. “

Republicans have called Biden’s plans the greatest welfare expansion in a generation. The Heritage Foundation recently pointed out that the temporarily expanded child tax credits under the US rescue plan “eclipse” the cost of other major aid programs, including Medicaid and the Supplemental Nutrition Assistance Program, still known to many as food brands .

“If the child tax credit expansion goes into effect permanently, it would destroy the foundations of welfare reform.” the conservative think tank said recently.

Vilsack, who heads USDA for the second time, hopes Congress will take note of the recent emergency relief and make some of the increased aid permanent. He is taking advantage of the decline in hunger rates to advocate Biden’s recently unveiled Family Plan, which would expand universal free meals to more school districts and provide permanent summer meals to all low-income school children. It would also extend child tax credits through 2025.

“Learn from it. Take the lessons from this terrible crisis and let’s find out how we can make something more lasting out of it, ”said Vilsack.

While the recent flood of federal aid is clearly a major factor, it’s too early to know how much the recent decline in hunger is related to stimulus payments and increased food aid, versus how much fueled by the improving economy has been. Economists have found that previous rounds of stimulus controls also led to a decline in hunger as unemployment rose sharply.

Data from the Census Bureau last month showed a marked decline in food insecurity as the government began distributing direct deposits or checks to millions of Americans from mid-March. The percentage of adults in households who sometimes or often did not have enough to eat fell by nearly 18 percent in just two weeks.

Data released this week showed further improvement in late April, suggesting the trend is continuing.

Two major aid packages have given money to millions of Americans in the past few months. In December, after months of negotiations, Congress passed a $ 900 billion package. The deal increased the benefits of grocery stamps, approved $ 600 stimulus checks for most Americans, and renewed unemployment benefits for millions.

Then, in March, Congress passed the $ 1.9 trillion American rescue plan, which granted direct payments of $ 1,400, extended unemployment benefits through September and continued to increase food stamp benefits.

Overall, Washington has poured unprecedented government aid into low-income households and millions of other households in a short space of time.

The Biden government is now looking for ways to permanently improve food aid. USDA is reviewing how the benefits of the Supplemental Nutrition Assistance Program are calculated – something that hasn’t been done in decades. The review proposed by Congress in the last farm bill is expected to result in a permanent increase in benefits.

Officials have said the results could be released as early as this summer. The department is under pressure to do so as the current disruption to SNAP benefits will expire in September.

During the pandemic, research has shown that many Americans are spending their stimulus checks on groceries and other household expenses.

Last year the The Census Bureau found that the vast majority of adults – 80 percent – who received a stimulus check in the spring, spent it on food. The next most common expense: rent, mortgage, and / or utilities.

A current analysis from Bankrate.com More than a third of Americans planned to spend their final stimulus check on everyday necessities like groceries and other supplies. Only 13 percent of Americans planned to spend the money on discretionary things like going out to eat or taking a vacation.

In addition to improving food security, Washington aid has lifted or kept millions of people out of poverty.

According to Jim Sullivan, an economist at Notre Dame University, one of the most striking things about all of this real-time data is seeing how much government aid has had an impact on poverty reduction.

Sullivan and his colleagues It has recently been estimated that poverty has decreased slightly in the first few months of the pandemic after Washington spent trillions on two early intervention packages that increased unemployment benefits, including sending millions of Americans 1,200 checks to millions of Americans. When part of the initial unemployment benefit ran out in the summer, poverty rose sharply, although unemployment fell dramatically.

“There’s a real track record here,” said Sullivan. “The federal response has done a great deal to prevent a massive increase in hardship. That’s not to say that there weren’t any problems, but it could have been much worse. “

While recent trends are encouraging, the rate of food shortages is still substantial. Despite the recent improvement, more than 16 million Americans live in households who report that they sometimes or often did not have enough to eat in the past week.

There are also stark racial inequalities. Black households with children still report more than two and a half times the food shortage compared to white households.

There are still tranches of federal aid that have not yet made it for the beneficiaries.

In September, Congress approved an extension of Pandemic-EBT, a $ 2 billion per month program designed to provide grocery-stamp-like benefits to families with children to replace the cost of subsidized or free meals during the Pandemic at school were missed. Eight months into the school year, billions of dollars remain tied up in bureaucracy as states grapple with the logistics of spending money, as POLITICO reported last month.

In Tennessee, for example, officials originally planned to give this aid to families in early January. The money finally ran out in April. Still, many families are waiting for help, said Signe Anderson, director of food representation at the Tennessee Justice Center. The group has received calls in the past few weeks.

“Most families have found P-EBT to be extremely helpful in feeding their families during the pandemic,” said Anderson. “We have heard of parents who have lost their jobs, cut working hours or had to stop working in order to be at home with their children.”

At this point, many low-income families are owed thousands of dollars in groceries dating back to the start of the school year. The government of Biden recently announced that it would extend the program until the summer.

As soon as this aid gets going in more states, economists expect that hunger rates in households with children could fall even further. Last summer, when the program was first launched, there was a marked decline as states distributed aid. The program has been estimated to raise hunger somewhere close to 3 million children.

Child tax credits, which the IRS said could start in early July, could further lower hunger rates later this year. These payments will be approximately $ 250 per child per month ($ 300 per child for those under 6 years of age) for six months.

While supporters of the fight against hunger are hugely encouraged by the latest data suggesting federal aid is working, they are quick to point out that the overall rate of food insecurity remains high in the richest country on earth.

Joel Berg, CEO of Hunger Free America, a New York-based nonprofit advocating higher wages and more government aid, said recent data shows that the recent stimulus packages and Biden’s policies “are actually reducing hunger in the United States to have”.

“But we also need to be clear that the nation is still suffering from a massive, long-term hunger crisis,” he said.

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