Hunger rates plummet after two rounds of stimulus

Economía y empleos
Politico, EE.UU.

The percentage of Americans struggling with hunger is now at its lowest level since the pandemic began, suggesting the recent flood in aid from Washington is making a significant difference to families struggling economically.

Data released by the U.S. Census Bureau this week shows the percentage of adults living in households that sometimes or often did not have enough to eat dipped to just over 8 percent late last month, down from nearly 11 percent in March. That is a substantial drop, and it came after hundreds of billions in stimulus checks went out.

“Money helps,” said Diane Whitmore Schanzenbach, an economist and director of the Institute for Policy Research at Northwestern University, who has been tracking hunger rates closely throughout the pandemic. “We’re continuing to see signs of progress. That’s exciting. That’s good news.”

The rate of American adults in households struggling with food is now down more than 40 percent since its peak in December — a fact that Democrats are beginning to tout as proof that hundreds of billions of dollars in direct stimulus is working as intended as they push for another massive package despite growing GOP opposition to more spending.

Republicans have long sought to shrink government aid programs like food stamps, but Democrats see the current crisis as an opportunity to broadly expand the social safety net.

The pandemic marks the first time the federal government has closely tracked in real time how households are faring during an economic crisis. The Census Bureau has been conducting biweekly surveys to probe how Americans are doing on a wide variety of issues, including household debt, missed rent payments and whether they recently went to a food bank.

With all of this data, Washington is learning that if you give people money, they will feed their families.

Tom Vilsack speaks during an event at The Queen theater in Delaware.
Agriculture Secretary Tom Vilsack speaks during an event at The Queen theater in Wilmington, Del. | Susan Walsh/AP Photo

“I think it shows the wisdom of the rescue plan,” Agriculture Secretary Tom Vilsack said in an interview. “This type of support does make a difference. This is a pretty dramatic decrease.”

Republicans have slammed Biden’s plans as the biggest expansion of welfare in a generation. The Heritage Foundation recently pointed out the temporary expanded child tax credits in the American Rescue Plan alone “dwarf” the cost of other sweeping aid programs when they launched, including Medicaid and the Supplemental Nutrition Assistance Program, which is still known to many as food stamps.

“If the child tax credit expansion is permanently enacted, it would destroy the foundations of welfare reform,” the conservative think tank said recently.

Vilsack, who’s leading USDA for a second time, said he hopes Congress will take note of the recent reduction in hardship and make some of the stepped up aid permanent. He is using the drop in hunger rates to make the case for Biden’s recently unveiled families plan, which would expand universal free meals to more school districts and permanently give all low-income schoolchildren summer meal benefits. It would also extend the child tax credits through 2025.

“Learn from this. Take the lessons from this horrible crisis and let’s figure out how to turn it into something more permanent,” Vilsack said.

While the recent spate of federal aid is clearly a major factor, it’s still too early to know how much of the recent drop in hunger is related to the stimulus payments and stepped up food aid versus how much has been fueled by the improving economy. Economists have found that previous rounds of stimulus checks also led to declines in hunger amid major spikes of unemployment.

Census Bureau data last month showed a significant decline in food insecurity at the same time the government doled out direct deposits or checks to millions of Americans starting in mid- March. The percentage of adults living in households that sometimes or often did not have enough to eat dropped nearly 18 percent in just two weeks.

Data released this week showed more improvement in late April, suggesting the trend is holding.

Two major aid packages have doled out money to millions of Americans in recent months. In December, Congress passed a $900 billion package after months of on-again, off-again negotiations. The deal increased food stamp benefits, authorized $600 stimulus checks for most Americans and renewed unemployment payments for millions.

Then, in March, Congress passed the $1.9 trillion American Rescue Plan, which authorized $1,400 in direct payments, extended unemployment benefits to September and continued the increase in food stamp benefits.

Taken together, Washington has poured unprecedented levels of government aid into low-income households and millions of other households in a short amount of time.

The Biden administration is now looking for ways to permanently bump up nutrition assistance. USDA is reviewing how Supplemental Nutrition Assistance Program benefits are calculated — something that hasn’t been done in decades. The review, which Congress requested in the last farm bill, is expected to lead to a permanent increase in benefits.

Officials have said the results could be out as soon as this summer. The department is under pressure to get it done because the current bump in SNAP benefits is set to expire in September.

Throughout the pandemic, research has shown that many Americans are spending their stimulus checks on food and other household expenses.

Last year, the Census Bureau found that the vast majority of adults — 80 percent — who got a stimulus check in the spring spent it on food. The next most common expense: rent, mortgage and/or utilities bills.

A recent analysis by found more than a third of Americans planned to spend their most recent stimulus check on day-to-day necessities like food and other supplies. Just 13 percent of Americans planned to spend the money on discretionary items like dining out or vacations.

Along with improvements in food security, aid from Washington has also lifted millions of people out of poverty, or kept them from falling into poverty.

One of the most striking things that’s come from having all this near real time data, according to Jim Sullivan, an economist at the University of Notre Dame, is seeing just how much of an effect government aid had on reducing poverty.

Sullivan and his colleagues recently estimated that poverty declined slightly during the first few months of the pandemic after Washington spent trillions on two early aid packages that stepped up unemployment benefits and sent $1,200 checks to millions of Americans, among many other forms of aid. When some of the initial unemployment benefits expired over the summer, poverty rose sharply, even though unemployment fell dramatically.

“There’s a real success story here,” Sullivan said. “The federal response went a really long way to prevent a massive increase in hardship. That’s not to say there weren’t hardships, but it could have been so much worse.”

While the recent trends are encouraging, the rate of food hardship is still considerable. Even with the recent improvement, more than 16 million Americans live in households that report they sometimes or often did not have enough food in the past week.

There are also glaring racial inequities. Black households with children still report more than two and a half times the rate of food hardship compared with white households.

There are still tranches of federal aid that haven’t made it out the door yet to those eligible.

In September, Congress authorized an extension of Pandemic-EBT, a $2 billion-a-month program to give food stamp-like benefits to families with children to help replace the cost of subsidized or free meals missed at school during the pandemic. Eight months into the school year, billions of dollars in aid remains tied up in red tape as states struggle with the logistics of doling out the money, as POLITICO reported last month.

In Tennessee, for example, officials had initially planned to get this assistance out to families in early January. The money finally started going out in April. Still, many families are waiting on the aid, said Signe Anderson, director of nutrition advocacy at Tennessee Justice Center. The group has been getting calls about it in recent weeks.

“Most families have found P-EBT to be extremely helpful to being able to feed their families during the pandemic,” Anderson said. “We’ve heard from parents who have lost jobs, had hours at work cut or had to stop working to be home with their children.”

At this point, many low-income families are owed thousands of dollars in grocery benefits, dating back to the beginning of the school year. The Biden administration recently announced it will extend the program through the summer.

Once that aid gets going in more states, economists expect hunger rates could go down even further in households with children. Last summer, when the program first rolled out, there was a significant decline when states distributed the aid. The program was estimated to lift somewhere in the neighborhood of 3 million children out of hunger.

Child tax credit payments, which the IRS has said could start as early July, could further reduce hunger rates later this year. Those payments come out to be about $250 per child, per month ($300 per child for those under 6 years of age) for six months.

While anti-hunger advocates are extremely encouraged by the recent data suggesting federal aid is working, they are quick to point out that the overall rates of food insecurity remain persistently high in the wealthiest country on earth.

Joel Berg, CEO of Hunger Free America, a New York-based nonprofit that advocates for higher wages and more government aid, said recent data shows that the recent stimulus packages and Biden’s policies “have, in fact, reduced U.S. hunger.”

“But we must also be clear that the nation is still suffering from a massive, long-term hunger crisis,” he said.

Helena Bottemiller Evich