California’s low rank- this one’s not so bad

A recent press release from California Food Policy Advocates–a public policy advocate group– asserts that over 13 million Californians suffer from “food insecurity.” The remedy, according to the CFPA, is to remove all legislative roadblocks to reaching 100% statewide participation in the federally funded Food Stamp Program. Currently, California ranks at the bottom of the list for utilizing food stamp dollars from DC.  In their report “Lost Dollars, Empty Plates”, the CFPA offers a rebuke to state law makers for leaving $3,735,766,000 in unclaimed federal dollars on the table in 2009. They further state that this neglect was harmful to the state government and local economies, arguing that expendable incomes for “food-insecure” Californians would rise if access to the subsidized program was made easier. A common, and fiscally frightening refrain implied throughout the report reads as follows, “Let’s expand our bureaucracy to increase our standard-of-living” Now, let’s examine this fallacy in the context of the food stamp debate:

The report indicates that, “The USDA has shown that every dollar in federal food stamp expenditures generates $1.84 in economic activity. In addition to helping people put food on the table, food stamps exert a multiplier effect that stimulates the economy.” This begs the question: economic activity for whom? The Wal-marts and JP Morgan/Chase Banks of California will see an upshot in all of this, but farmers markets and food stores supplied by small farmers won’t see much of the action. These merchants generally lack the costly equipment to accept EBT payment methods or simply can’t or refuse to work through the complexities of dealing in Scrip. Smaller, non-EBT vendors and direct farm to consumer sales are the drivers of the burgeoning Local Food movement which many argue is the only model for food security for every California citizen. It’s quite alarming that supposed supporters of a sustainable food policy would advocate further subsidization of the industrial-ag model. Surely the large industrial farms, global commodity traders and large retail outlets who sell their goods would be the main beneficiaries of these “underutilized” federal funds. Inner city dwellers, who no doubt make up a large portion of the demographic of food stamp recipients, have issues enough finding fresh food, much less paying for it with food stamps. It is this section of the population that is beholden to the processed “goods” manufactured around the clock by the global food cartel. Expanding food stamp participation would only further this unhealthy dependence and certainly wouldn’t help rebuild communities.

If subsidy dollars should go anywhere, they should go to developing community garden programs for urban areas, to the small and sustainable organic farms of California who can easily provide  enough healthy food for the whole state. How about tax breaks to corporations who provide in their cafeterias local produce from large Community Supported Agriculture networks? There are many ways to encourage the sustainable production and distribution of food on a local scale that would  truly invigorate local economies and open the door for many new jobs in the agricultural and retail fields. A true multiplier effect is found not in investing inflated federal dollars in multinational corporations. The Fed can ease up on the printing press and let local producers get their hands on consumer dollars so as to reinvest them in their actual community.

Out of the two economic arguments provided by CFPA in support of the program, the claim that tax revenue is a viable incentive for the state is more easily debunked. A “stifling” economic effect this policy group foresees, if California remains a food stamp underachiever, is the missing tax revenues that a rise in expendable income should provide. One of the issues the report fails to mention is the administrative cost attached to their supported goal: The federal government only covers half the dollars requisite for administering the Food Stamp program in California with the state and counties absorbing 35% and 15% of the the financial burden respectively.  These costs aren’t guaranteed to be offset by increased income to the state from sales taxes. After all, how many bureaucracies are in existence that do not overreach their budgets and almost instinctively expand them? 

While the argument of “more expendable cash” seems unassailable on the surface, there are a myriad of hidden costs, mostly in the long-term, that must be paid when accepting federal aid in any form. These costs, it will be found, outweigh the immediate gratification found in going to your local Wal-mart and stocking up the pantry, and this we do at the risk of further inflating this country’s newest economic bubble- the dollar. Californians should be proud that their state ranks at the bottom for food stamp participation, even if the cause is, paradoxically, stringent and (arguably) unnecessary laws. We’re better off taking advantage of any roadblocks we can get to dissipate a run-amok federal bureaucracy. The irony will only be appreciated in the long run.