United States of Food Stamps: Food stamp usage has grown by 30,000,000 people since 2000. The economics of a food stamp recovery.

I was working through a few pages of Excel data regarding food stamp usage and a troubling milestone has now been breached.  Since 2000, we have now added over 30,000,000 Americans to the food stamp program now labeled SNAP.  What is even more difficult to understand is this number has moved up nearly unabated since 2000 even though if you believe the data, we were in full recovery from 2001 to 2007 until the financial crisis hit.  In reality, what was happening was that the poor and working class were merely papering over their shrinking wealth by going into unsupportable debt.  The fact that food stamp usage continues to move up is a very telling sign of our current economic situation.  Over 47.77 million Americans are now on food stamps.  In many parts of the country, Wal-Mart stores have adjusted store hours at the end of the month to coincide with food stamp debit cards (EBT) being reloaded allowing people to shop.  I wanted to dive into the food stamp data a bit deeper.

Food stamp participation up by 30,000,000 people since 2000

I doubt anyone would ascribe growing food stamp usage with an actual economic recovery.  That might be a bit of a stretch. When we chart this out, it becomes even more dramatic:

food stamp usages

Source:  SNAP

Keep in mind that for most of the 2000s, we’ve been in a “recovery” according to various sources.  Yet food stamp usage soared dramatically over this period.  Also, keep in mind that we’ve been in an economic recovery since the summer of 2009 yet food stamp usage continues to expand.  In 2009 we had 33 million Americans on food stamps.  Today it is over 47.77 million adding nearly 15 million people to the program during a time of economic recovery.  At least that is what we are told.

Record number of families on food stamps

While we are off from the peak reached in December at least in a raw count of people, we are actually at a new peak when it comes to households on food stamps:

food stamp usage

Source:  SNAP

Over 23.08 million households are participating in the SNAP program.  When we look at the stock market making record highs we have to keep in mind that most Americans do not have any sizable amount of money in bonds or stocks.

Food stamp costs are obviously rising with the growing number of people in the program:

food stamps benefits

Keep in mind that much of this gets spent back into the economy so this isn’t an argument on the merits of the program.  There are strict means testing to get on food stamps which is even more troubling because it underlies how many Americans are really in dire economic situations.  How is it feasible that we can call this a recovery when we have a vast portion of our population struggling to get by on food stamps?  In other words, these families have such little income that they need supplemental support just to feed themselves and their children.

Take a look at what states have the highest food stamp participation:

food stamp participation by state

It is astounding how many states have 20 percent or about 20 percent of their entire population on food stamps.  The economics of food stamp usage have also created some winners here.  After all, if you have 47 million customers receiving a set amount each month, you can provide products to this group.  It is interesting that many dollar stores have shifted from general items to focusing on a large portion of their store selection being on food.  Take a look at a couple of major dollar stores around the country and how well they have done over the last few years:

family dollar 99 cents store

Some excellent performance from both Family Dollar and the 99 Cents Stores.  Are we on path to reaching 50,000,000 Americans being on food stamps?  At this rate, it’ll only be a few years away. If you think this is the case, you now have a few stocks to invest in assuming you have the money to invest.  I believe Wall Street would call this the food stamp play.

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4 Comments on this post

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  1. William said:

    Is the increase in food stamps usage related to an increase in single parents or is it mainly economics ?..The majority of people who I see using EBT cards are young (20’s)…Poverty is a very lucrative business – depending on what side of the equation you are on.

    April 28th, 2013 at 7:10 am
  2. Paul Verchinski said:

    Or it could be that a whole lot of folks are now solely in the cash economy so that they do not lose benefits. Buying continues so the money has to come from somewhere.

    April 28th, 2013 at 7:34 am
  3. D Ross said:

    Back in 2003 I was doing contract work on the island of Guam, a US territory in the western Pacific. After I left the office I stopped by a local super market to pick up some things for my wife. At any rate, as I waited in the checkout line at the market, a non-American woman, decked out in gold rings and ankle chains unloaded a huge cart load of prime meat and a sundry of other gourmet delicacies. Directly directly behind her a man (boyfriend or husband) pulled a cart in, loaded with beer and booze.
    Then, as I watched in a stupefied trance, the lady pays for her load of goodies with (you guessed it) Food Stamps. The male buddy paid for the booze with greenbacks.
    I thought to myself, here I am, working like a slave all day and these (non-Americans) are living high-on-the-hog. Humm – I mused, let’s see what kind of a rent-a-wreck are they driving? Whoops … you guessed right again,- a beautiful one year old Honda Accord. Thirty percent of the people on Guam are on food stamps.
    Reminds me of that morning several years ago, driving to my office in Honolulu. In the semi-darkness of the North Shore Oahu morning, I sighted a bunch of mainland surf-bums heading out for a day of play in the sun. I thought to myself (again), who’s the dummy here, me or them? And again (you guessed it right) that next weekend I saw the California surfers buying loads of goodies at the Haleiwa market – with Food stamps.

    May 10th, 2013 at 5:06 am
  4. Ampaporn Mattox said:

    When I work at Grocery with the minimum wage, and went to college at the time. I was not apply for the food stamps. I saw many customer with food stamps bought very good food, but people who paid by their own money-they were hardly to get good food much. Food stamps should be only for the family who really need it, and unable to work, but many did not do it that way.

    October 3rd, 2013 at 9:11 am

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