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The Daily Need

Another big problem with Newt Gingrich’s ‘food stamp’ claim

As it turns out, food stamps are one of the most effective ways to stimulate the economy during a recession.

GOP presidential candidate Newt Gingrich with his wife Callista during a Florida primary night rally on Tuesday. Photo: AP Photo/Matt Rourke

Now that Mitt Romney has thumped his rivals in Florida and regained the mantle of GOP front-runner, there’s only one person who can really decide whether the race ends soon or drags on: Newt Gingrich. Gingrich’s grandiosity — or his “nuttiness,” as some conservative commentators have called it — is likely to animate the Republican primary at least through Super Tuesday. And even though Gingrich is unlikely to win the nomination, there are still many conservative voters who like his bombast and culture war broadsides against “the establishment” and “the media.”

Those broadsides, however, aren’t always based in reality — and they threaten to derail both his campaign and, potentially, the GOP effort to unseat President Obama. For example, Gingrich is still defending perhaps his most infamous claim yet, that Obama is the “greatest food stamp president” in history. Critics and fact-checkers have denounced the claim as offensive, racially charged and flat-out wrong. Obama himself dismissed the claim as “divisive” in an interview with ABC this week. And there are factual problems with the statement, too.

For one thing, the Supplemental Nutrition Assistance Program is a voluntary program, so Gingrich’s contention that Obama is “forcing” people onto food stamps doesn’t make sense. The increase in SNAP enrollment is also clearly a product of the recession, which began more than a year before Obama took office. And as it turns out, SNAP enrollment began to tick up during the administration of George W. Bush, due to rules changes adopted by the Bush administration that made it easier for people to apply for and receive benefits.

But there’s another, more fundamental problem with Gingrich’s claim that no one seems to be mentioning, and which illustrates the core disagreement between Republicans and Democrats heading into the general election: Food stamps, as it turns out, are one of the most effective tools available for stimulating economic growth during a recession. In fact, SNAP benefits are as much as three times more effective at stimulating economic growth than policies favored by Gingrich, such as tax cuts for high earners.

According to a “multiplier analysis” conducted last year by the non-partisan Congressional Budget Office, “transfer payments” from the federal government to the states for social welfare programs such as unemployment benefits and food stamps had as much as 2.1 dollars of economic impact for every one dollar spent. According to the CBO, that makes food stamps basically one of the best things you can do to keep the economy moving during a recession. By contrast, a one-year tax cut for high earners had only 0.6 dollars of economic impact for every one dollar spent. As Chad Stone, chief economist at the non-partisan Center on Budget and Policy Priorities, put it last year: “Republicans want to give tax cuts to high-income individuals, and that’s not nearly as effective” as programs like food stamps.

Why? In short, because food stamps help fill gaps in working Americans’ household budgets, which allows them to spend more money on buying things, which stimulates the economy. As Abby Jean, a political blogger on Tumblr, noted, a large and growing share of SNAP households are actually working households. So food stamps aren’t purely hardship assistance programs — they put money back in the pockets of working people who contribute to the American economy.

In all the coverage of the Gingrich “food stamp” refrain, that fact has gone largely unstated, but it gets at the central philosophical divide between Republicans and Democrats this year: Democrats believe stimulating consumer demand will revive the economy, Republicans want to keep taxes low for high earners. Calling Obama “the food stamp president,” then, may be wrong and offensive, as many critics have argued, but it’s also not really a mark of shame. According to the numbers, calling him a “tax cuts for rich people” president would be much, much more damning.

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