“Each year, the federal government hands approximately $10 billion over to the richest 1% of Americans — mainly to rich retirees — according to an IBD analysis of data on various federal transfer programs.”
— “The Richest 1% Get $10 Billion A Year From Uncle Sam”, Investor’s Business Daily
There are 120 million households in the US, so let’s just say that the 1% is 1.2 million households. Diving $10 billion by 1.2 million and you get $8,333 in average yearly payouts to each ultra-rich household.
Compare this to the fact that the average yearly Supplemental Nutrition Assistance Program (SNAP, e.g., food stamps) annual benefit is $3,300 year.
Before we start cutting food stamps, we should start means testing Social Security and Medicare.
How exactly can anyone claim that we should end food stamp benefits to the impoverished while we’re busy handing out nearly as much money to “rich retirees” who absolutely do not need this additional income? How can we possibly claim in good conscious that food stamps are going to “lazy people living a life of leisure on the dole” when a) the “overwhelming majority of SNAP recipients who can work do so” and b) we seem to pay out as much money to people who are almost certainly living a life of leisure?
The average SNAP household has a gross annual income of $8,928 and “countable” resources (e.g., bank accounts) totalling $331. 76% of SNAP-receiving households feature a child, an elderly person, or a disabled person. By comparison, the average income of the top 1% is $717,000 per year, about 80 times more. These households enjoy an average net worth of $8,400,000. Even if we were to assume that SNAP recipients have, on average, another $3K in net assets (e.g., cars or real estate less debt like medical bills), a household in the top 1% has more than 2,500 times the net worth of the average SNAP household.
So let’s compare these benefits each group’s net worth. For SNAP recipients those annual benefits are roughly equal to their net worth. For the richest 1%, a cut in these handouts would be equal to about 0.1% of their net worth. Assuming that the richest 1%’s net worth appreciates by only 1% a year (interest, etc), their net worth grows by the value of the handout in about five weeks.
Therefore, how in good conscious could we cut $8.6 billion in SNAP benefits over 10 years to the poorest and most vulnerable citizens of our great nation—people who are guaranteed by the nature of the program to pour every single last dollar of those benefits back into our economy—while we hand checks to rich retirees who use them to pad their already overflowing coffers? How do we expect we’ll be able to remain competitive in the global arena when 20% of children don’t have enough to eat and therefore face another obstacle to getting a good education? I grant that many of these dollars come from earned Social Security credits. However, if we’re going to change our social contract due to budgetary concerns, why don’t we do so in a progressive way that is likely to promote further liberty and prosperity for all rather than our wealthy plutocracy for whom the cuts wouldn’t make a lick of difference?
Creative Commons photo from American Progress.