Food stamps are a continuing reminder of widespread poverty

from the Independent

By Rupert Cornwell in Washington

In one form or another, food stamps have been around in the US since 1939, before taking their current form in the 1964 Food Stamp Act, one of the earliest pieces of major legislation in the Johnson administration's "War on Poverty".

Mostly gone however are the days when the stamps consisted of vouchers presented for payment at a grocery store or a supermarket checkout. Now they usually take the form of a credit on an electronic debit card, reducing the visible stigma of their use for people too proud to admit they could not cope on their own.

And that – at least as much as greater public awareness of the programme and the downturn now gripping the US – is a reason for the steady increase in their use since 2001, a period of solid economic growth until the full explosion of the subprime mortgage crisis in late 2007.

Food stamp use declined during the second half of the 1990s thanks to the controversial 1996 welfare reform bill, and the exclusion of legal immigrants from the programme. Those provisions have now been reversed, and both state and federal governments have taken measures to make people more aware they are eligible.

In Michigan, for example – a state especially hard hit by a loss of manufacturing jobs and where one in eight residents uses food stamps – the state legislature has voted a bill whereby the entitlement will be added to debit cards twice a month, instead of once a month previously.

But food stamps are also a reminder of the continuing existence of widespread poverty in the US, and the ever expanding gulf between rich and poor in the world's wealthiest country intensified, experts say, by the Bush administration's tax cuts. Top income brackets have seen their disposable income soar, while earnings of the lowest paid have struggled to keep pace with inflation.

The minimum wage had stood unchanged for a decade – its longest freeze ever – until it was increased to $5.85 an hour from the $5.15 set in 1997. The national poverty rate stands officially at around 13 per cent, a level little changed from the 1970s. Poverty is currently defined as an income of $21,500 (£10,750) for a family of four.

Almost certainly the number of people eligible for, and using, food stamps will rise for the next year or more, if the downturn becomes a full-blown recession.

Inevitably, comparisons with the Great Depression, when food stamps did not exist, are being made. Then, a quarter of the workforce was unemployed, compared with just 5 per cent today. By one estimate, 60 per cent of the populace lived in poverty in the depths of the Depression. The 30 per cent poverty experienced in some US inner cities and depressed rural areas today is showing signs it is capable of reaching that level.