Truesee's Daily Wonder

SNAP, the federal food stamp program, is getting snapped up by Democrats these days, hungry for savings to placate deficit hawks and clear the way for legislation.

In a matter of hours Thursday, the Senate approved state fiscal aid and child nutrition bills which help pay for themselves by cutting more than $14 billion from food stamps. The savings come from rolling back a benefit increase approved in the giant economic recovery act last year, but with each bill, the cut-off date has gotten closer and closer, alarming anti-poverty groups.

Early drafts of the $26.1 billion fiscal aid package, for example, set a spring 2015 target date for the cut. This was then moved up one year to April 2014 in the final Senate bill to achieve total savings of about $11.9 billion.

The child nutrition bill, approved hours later, goes back to same well and moves the cut-off up to November 2013. This achieves about $2.2 billion in savings, money that helped broker a deal with Senate Agriculture Committee Republicans who had opposed efforts to cut instead from a farm conservation program popular with livestock producers.

Indeed, the tradeoffs are painful, forced by the immense pressure now to come up with offsets for any new spending.

Before going home Thursday night, for example, the Senate approved a $600 billion border security initiative that pays for itself with fee increases, as large as $2250, on the visas which companies must buy to bring in skilled foreign workers. But so to shield American technology companies, the bill appears tailored to hit hardest just four major India based companies with operations in the U.S.

That sort of finessed financing is harder in the case of larger domestic bills like the fiscal aid package. As awkward as the food stamp cuts are, Democrats argue that the benefit reductions won’t hit home still for years, while tens of thousands of teachers could lose their jobs next month.

In the case of the child nutrition bill, Sen. Blanche Lincoln (D-Ark.), who chairs the Senate Agriculture panel, told POLITICO that in today’s political climate, the SNAP dollars would have been siphoned off by some other panel if she hadn’t acted first.

“We were going to lose those dollars anyway,” Lincoln said. “You saw the teachers grab for it. The point being is that at least these dollars are going to feed children just like SNAP dollars would. I certainly think it’s much more practical, if we’re going to rededicate those dollars rededicate them to what they were intended to do.” 

James Weill, president of the Food Research and Action Center, isn’t buying. “They are just creating a self-fulfilling prophecy,” he told POLITICO. “There is always an excuse but to pass a bill that’s going to make kids hungrier is unacceptable.”

Having reluctantly supported the choices made in the fiscal aid bill, Bob Greenstein, head of the Center for Budget and Policy Priorities, said he favored “drawing at line” at the 2014 cutoff and taking no more out of SNAP.

When the recovery bill was first written, Greenstein was an influence of the decision to allow a temporary 13.6 percent bump-up in benefits but then smooth out the disparity over time. Instead, the changes now will create a cruder drop-off, worth about $47 a month for a family of three beginning in November 2013.

The House still has a major voice but there’s little doubt that the fiscal aid bill — with its food stamp cuts — will pass the chamber next week. Speaker Nancy Pelosi (D-Cal.) has called lawmakers back from their summer recess to act on the measure, and the House Rules Committee announced plans to meet Monday evening as a first step toward the floor debate Tuesday.

Cash-strapped governors are promised $16.1 billion to help pay Medicaid bills next year, and $10 billion will be distributed to state and local school boards to address the more immediate threat of teacher layoffs.

Best known by the acronym FMAP, the Medicaid dollars boost Washington’s contribution under the so-called federal medical assistance percentages that dictate the shared costs for Medicaid, the chief health care program for the poor and disabled.

The measure now builds on last year’s giant recovery act, which boosted the base federal payment by 6.2 percent and made further adjustments depending on a state’s unemployment rate. This program is due to run out in December, and the new bill would extend the aid for six months but reduce the percentage to 3.2 percent in the first quarter of 2011 and then 1.2 percent for the second.

In the case of the school aid, the Education Department estimates that as many as 145,000 teaching positions could be saved with the added funds — a major reason for the House to return now from its recess.

These expenditures will have an immediate impact of adding to the 2011 deficit, but the bill will more than pay for itself over the next decade, according to Congressional Budget Office estimates, showing a net $1.37 billion deficit reduction.