This article talked about the historic reasons why the food stamp program is part of the Farm Bill. It had an interesting statistic within it:

FDR also supported creation of the first Food Stamp Program, in 1938. The program operated by permitting people on relief to buy orange stamps equal to their normal food expenditures; for every one dollar worth of orange stamps purchased, 50 cents worth of blue stamps were received. Orange stamps could be used to buy any food; blue stamps could only be used to buy food determined by the Department of Agriculture to be surplus. Over the course of nearly four years, the program reached approximately 20 million people in nearly half of the nation’s counties, and cost a total of $262 million (about three billion dollars in 2006 dollars).

The USDA tracks the Supplemental Nutrition Assistance Program (SNAP) participation and costs. It notes that in 2006-2012:

Year  Average        Average        Total           All Other        Total
      Participation  Benefit/Person Benefits        Costs            Costs
  --Thousands--  --Dollars--     ----------Millions of Dollars----------

2006  26,549         94.75          30,187.35    2,715.72    32,903.06
2007  26,316         96.18          30,373.27    2,801.21    33,174.48
2008  28,223         102.19         34,608.40    3,033.64    37,642.04
2009  33,490         125.31         50,359.92    3,261.58    53,621.49
2010  40,302         133.79         64,702.16    3,611.30    68,313.47
2011  44,709         133.85         71,810.92    3,904.59    75,715.51
2012  46,609         133.41         74,619.46    3,817.33    78,436.79

In the first 4 years of running the food stamp program, it served 20 million people at a cost of $3 billion, or $150 per person in 2006 inflation adjusted dollars. SNAP in 2006 served 26 million people at a cost of $30-$33 billion, or $1,137-$1,239 per person. Why is their a 10 times increase in the cost of running the program? (Note: The 1938-1942 food stamp program dollars were already inflation adjusted)

  • 7
    Question is, what was the relative cost of a food basket then and now? Inflation-adjusted isn't necessarily food-basket adjusted.
    – user4012
    Jul 7 '13 at 15:26
  • Part of the answer may be the fact that modern food as eaten by typical SNAP recepients (junk food and ready-made food from food joints vs. groceries and home cooking of nutritional meals) has a significantly lower nutritional content than in 1938.
    – user4012
    Jul 7 '13 at 15:29
  • 2
    Another part of the answer may simply be the fact $150 doesn't get a whole heck of a lot of food for the year also.
    – xuinkrbin.
    Jul 9 '13 at 5:26
  • 4
    While @DVK has already mentioned this, it is worth explicitly restating: any inflation measure is normative. CPI measures what the States' bureau of statistics is told to measure as "consumption," and what they believe they ought to measure. These "consumption bundles," represent normative accounts of what is believed "fit" for workers, sometimes broken down segmentally, to eat, wear, (sometimes) rent, drink, smoke, gamble. Sometimes with categories set at zero. CPI may not meaningfully reflect SNAP recipients living costs over time as they're below CPI bundle consumption levels. Aug 19 '13 at 4:54

Quite simply, the standard of living for the average American has increased so dramatically that to equate a 1938 poverty level with a 2013 level 75 years later would not be practical. The same amount of "stuff" (e.g. living space, calories, leisure time) that would have made a person "rich" in the midst of the Great Depression would comparatively be "poor" by more modern standards.

As a thought exercise, drive through the inner suburbs of, say, Detroit - a city that was booming in the early part of the century. There, the average house may be around 700 - 900 square feet, give or take. Those houses aren't 'slum' but neither are they rich.

Now, do the same thing in San Jose or Fairfax County - counties that developed much later. The average house size is going to be more in the 1400 - 2000 square foot range. Why? The answer isn't really climate - it's wealth. Wealth, as they say, is a rising tide that lifts all boats.

This same phenomenon explains why a middle class American gets more calories and has a bigger house than a middle class Briton, German, or even Brazilian. There are differences in the standard of living.

The poverty line in the United States is based on a relative measure - not an absolute one. The poverty line is based on the diet of an average American living in 1963 (cite), a standard of living that is far in excess of that in 1938. Using this constant as a measure, the proportion of households that could not get this fixed amount of calories in 1959 was 22%. In 2011, it was 15%. That is a dramatic difference, and is reflected in a higher standard of living. In 1938, in the throes of the Great Depression, that number probably would have been much, much, higher, meaning that a "middle class" person consuming the same amount of resources in 1938 would have needed to be much, much richer.

Simply put, everybody was richer in 1963 than in 1938. Relatively speaking, poverty - meaning towards the end of the spectrum - was a much lower thing.

As an interesting aside, the Economist has a great article comparing the depth and breadth of welfare vis a vis 'poverty' across Asia that bears some meditation.

  • "why a middle class American gets more calories and has a bigger house than a middle class Briton, German, or even Brazilian" ... that whole paragraph is just odd. Neither calorie intake nor "house size" btw. US <-> UK or Germany should be explainable by "wealth". And what does the Brazil comparison, a country with less than half the PPP GDP of Britain, have to do here?
    – Martin Ba
    Oct 26 '20 at 22:41

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