How Nutrition Assistance Programs Help Keep Farms Afloat

by Ryan Nebeker

3/26/20

This week, the Senate agreed on a massive economic stimulus plan to address the devastating impact of the COVID-19 outbreak on the economy. Some proposals — especially the plan to send checks to most American adults — have garnered a lot of attention, but the stimulus touches on almost all sectors of the economy, including agriculture. 

One of the provisions in the new stimulus package would give the USDA’s bank $50 billion to recoup farmers for their lost sales, a system the Trump administration already used to bail out farmers impacted by the trade war. While at least two of the largest farm organizations have urged Congress to include these payments in the stimulus, critics point to their mixed record: there’s evidence that large farms got high payments as small farms struggled to stay afloat.  

While advocates for local food and sustainable agriculture have suggested a number of provisions to help farms of all scales stay in business during the COVID-19 crisis, farmers have another support system already embedded in the relief and stimulus efforts. Food aid — like SNAP and WIC — is a critical component of any economic recovery package, but it does more than keep jobless people from going hungry. The goal of a stimulus is to strategically put money in pockets so the economy keeps moving, and the nutrition assistance programs in the stimulus package are a vital lifeline to help farmers and food producers weather this downturn.   

How Nutrition Assistance Can Help Farmers

SNAP and WIC 

The country’s two largest nutrition assistance programs are the Supplemental Nutrition Assistance Program (SNAP, formerly known as Food Stamps) and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC). Under normal conditions, SNAP provides low-income people with a monthly “benefit” that they can only spend on food. The requirements vary from state to state but typically, people need to be near the federal poverty line to qualify. The amount of the benefit varies based on income and household size. WIC works a little differently, and provides pregnant women and mothers with young children vouchers to purchase specific eligible foods, mostly healthy staples like dairy, fruit, vegetables, and infant formula. 

In an economic downturn, nutrition assistance programs play an obvious role in feeding the hungry: more unemployed people means that more people qualify for government assistance. However, SNAP and WIC are also an opportunity to help stimulate the economy, and lawmakers can tweak the programs to encourage this. Doing things like increasing the amount of money people can receive every month can have big impacts. First, people who recieve more money specifically for food can spend more of their own money on other things, which helps stimulate the rest of the economy. Second, the increased amount of money that recipients spend on food helps farmers and food retailers keep their sales up and stay in business. 

Even Bigger Boosts from Double Up Food Bucks

This is especially true when increases are paired with programs like Double Up Food Bucks that match funds for purchases at farmers’ markets. This means consumers can get twice as much food out of their SNAP benefits, and gives farmers a big boost in sales. Increasing the amount of money that SNAP participants received was a critical part of the stimulus package passed during the 2008 recession, and subsequent research showed it was one of the most effective parts of the legislation: every dollar spent generated about $1.70 for the economy. 

In responding to the current crisis, lawmakers laid out over a billion dollars for extra food aid in their first relief bill, including an additional $500 million for WIC. Congress also authorized a shift in funds from the School Lunch Program to SNAP, allowing families who normally rely on free school lunch to get extra SNAP money while their kids can’t go to school. The Senate’s latest agreement on the larger stimulus includes a 15% increase in the total SNAP budget, which will fuel further expansion of the program and keep food demand high.

Commodity Buyups 

In addition to programs like SNAP and WIC that give recipients money or vouchers to buy food, the USDA has another strategy to help both hungry consumers and farmers: purchasing food directly and using it for government-distributed assistance. Since the Great Depression, the government has bought up extra commodities (most famously cheese) and either kept them in storage or used them in government institutions and assistance programs. While these seem like a convenient way to feed hungry people, these programs were mainly designed to ensure that farmers could sell their products even when prices are low. These “extra” commodities are used in a variety of institutions, including the National School Lunch Program.

With schools closed, however, those commodities are being used elsewhere. The initial relief package allocated an extra $400 million for the Emergency Food Assistance Program, which allows the USDA to purchase food and send it to food banks and other emergency distribution centers. While we tend to think of food pantries as mainly canned foods, the Emergency Food Assistance Program specifically includes fresh and frozen fruits and vegetables. Given that fruit and vegetable farmers are already feeling the effects of lost business, this could become a way for them to sell their goods even as restaurants and farmers’ markets become unreliable. 

Still, there are possible issues: the list of foods USDA usually provides participants doesn’t currently include the more specialized produce farmers grow for restaurants, much of which has already been planted for the season. There’s also no premium for organic growers, who might not be fairly recouped for their higher expenses. However, because this program is intended to help producers and varies based on the market, it’s likely that the foods USDA purchases will be more flexible than under normal conditions. 

Food Aid is a Vital Lifeline

Farmers are still struggling to address many aspects of the COVID-19 crisis, like ongoing concerns about farmworker safety and the loss of major buyers. While debates about whether or not the stimulus goes far enough to protect small farms are ongoing, the approved expansion of nutrition assistance is a bright spot. By both keeping demand for food high and offering different ways for farmers to get their food to market, food aid is a vital lifeline to keep farms in business during what will likely be a long economic recovery. 

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