Food Pantries for Poor, Loans for Hungry Bankers
A friend recently assisted at a local food pantry on Mount Desert Island, and she was shocked to learn that the pantry had distributed more than $6,000 in food vouchers during that Sunday alone. Many working-class residents of our small community have been struck by a perfect storm, an unprecedented increase in food prices combined with deterioration of the labor market. As with Hurricane Katrina, this storm presents two divergent options.
Some view the hungry as victims of economic forces beyond their control. Unfortunately, however, too many citizens and legislators portray the hungry as miscreants whose lack of discipline and foresight occasioned their distress. At best they deserve only our pity or assistance laced with large quantities of moral guidance and personal reconstruction.
The hungry-as-miscreants idea, long prominent in our culture, is especially problematic today. New York Times columnist Paul Krugman points out that the days of cheap food may be behind us. The cost of basic foodstuffs has doubled or tripled during just a few years. The causes of this escalation are not the food preferences of the poor but rather public policy choices that have greased the skids for the wealthy. There is the vast public subsidy of the ethanol boondoggle that has greatly increased the cost of agricultural land. And then the occupation of Iraq playing a major role in the increase in oil prices, which in turn increase food costs.
At the same time, the job market that is supporting the working class is collapsing. The unemployment rate surged to 5.1 percent in March. Though the most recent jobs report indicated that “only” 20,000 jobs were lost, long-term prospects are bleak. Economist Dean Baker points out that “with real wages declining, and the plunge in house prices destroying home equity at more than a $2.5 trillion annual rate, it is likely that the rate of job loss will accelerate in the months ahead.”
Any food pantry may well serve a few residents who have made improvident choices, but for most, the constraints imposed by rising prices of necessities and a collapsing job market impose insuperable obstacles. And why some conservative commentators focus on the purported moral or intellectual limitations of the poor is mystifying. More media and public scrutiny should be directed toward the other end of the social spectrum. Wealthy financial houses and mortgage brokers have dragged the rest of us down even as they walk away with awesome severance packages.
The Federal Reserve, concerned about the possible collapse of the U.S. financial system, has now extended short-term loan privileges to large and unregulated investment banks. The production and marketing of complex and deceptive mortgage-backed securities by this unregulated shadow banking system substantially exacerbated the current meltdown.
The Fed will, nonetheless, accept as collateral from these investment banks much of the same commercial paper that the private market has steadfastly rejected. It will even do so without imposing the capital and other requirements that the Fed demands of conventional commercial banks where most of us hold our checking and savings accounts.
Meanwhile Congress does all too little to enhance the humble food stamp program, a task at least as worthy as a Fed bailout of Bear Stearns. One columnist for The Independent, a London newspaper, recently lamented the “steady decline in real [food stamp] benefits since 1996, when the ‘standard deduction’ for living costs, which is subtracted from family income to determine eligibility and benefit levels, was frozen. If that deduction had continued to rise with inflation, the average mother with two children would be receiving an additional $37 a month.”
Boosts to the food stamp program are justified practically as well as morally. As Andrew Levine points out in Salon, “The attraction of food stamps is that, unlike cutting a check … to every American, increasing their value doesn’t require goosing cumbersome IRS machinery into motion. … Food stamps are administered through debit cards - at the flip of an electronic switch benefits can be boosted, with the advantage of being perfectly targeted at those most likely to need help in an economic downturn … Every dollar invested by the government in food stamps results in $1.84 in economic activity.”
Maine food pantries are going to face an increasing burden in the next year. Hungry neighbors are fortunate that there is a community willing to extend assistance to those in need without casting aspersions on their judgment or morality. Food security, however, should be a fundamental right not dependent on the good will of neighbors. At the very least, the next stimulus package, needed soon, should greatly enhance the food stamp program.
John Buell is a political economist who lives in Southwest Harbor. Readers may contact him at jbuell@acadia.net.
© 2008 The Bangor Daily News
i’ve found a workable solution to rising food costs; i eat only every other day. as for food pantries, i find that they have an over-abundance of canned green beans.
I’m gonna use my hundred billion dollar loan (collateralized by pieces of paper that should be holding me to billions in losses) to buy up food futures on the open markets! My friends with other loans will buy them back from me, through the markets, at a profit for me. Then the starving will starve, my profits will be locked in, and the MSM will crow about how well the economy is doing! I love being Big Money!
I work once a month at our local food pantry and those clients are as the author describes-working class. sure, we do see folks who appear to be working the system, but they are the minority.
texlorado-I’m amazed at the oddball stuff people donate. I figure, if I won’t eat it, why do I think someone else will-though I like green beans, myself.
last month our shelves were ebarrassingly skimpy. Thank goodness for the local food drives in the past few weeks.
I simply don’t eat the last week of each month as I run out of money. Corporations clearly need more help than I do. I lose weight and jeopardize my health (I have a life-threatening illness) so it’s all good - I’ll die all the sooner!! Yay!! (; DOWN WITH FOOD BANKS! UP WITH MONEY BANKS! (;
The rocketing costs of fuel affect personal transportation as well. Whether you drive your own vehicle or use mass transit.
Given the occurance of global warming, resource depletion (including enrgy) and enviromnmental degredation, we should be investing in good food, nutrition, transportation and financial policies.
Remember, Bush was against a tax break for those receiving food stamps?
Instead, the pillagers of the public purse accelerate their plunder. Bush is King of the world.
I wonder when the band will start playing “Nearer My God To Thee?”
The author writes; “There is the vast public subsidy of the ethanol boondoggle that has greatly increased the cost of agricultural land.”
While I agree that subsidizing ethanol production, while even without the subsidy it is quite profitable, is even worse than a boondoggle given the current situation with grain supplies. Farm land prices here in Indiana have not risen as much as corn, soybean and wheat prices. Under the new Farm Bill the ethanol subsidy will go from $.51 per gallon tax credit to $.45 per gallon tax credit.
Here’s a breakdown of the new farm Bill from the Minneapolis Star Tribune;
“Domestic nutrition programs make up the largest portion of the estimated $300 billion farm bill. Crop subsidies make up roughly 14 percent, foreign food aid less than one percent.
A breakdown of the bill:
Food stamps and other domestic nutrition programs such as emergency food assistance: just over 66 percent, about $200 billion.
Subsidies for rice, cotton, corn, soybeans, wheat and other crops: 14 percent, around $43 billion.
Conservation programs to set aside or protect environmentally sensitive farmland: 9 percent, about $27 billion.
Crop insurance to help farmers protect against losses: 8 percent, about $23 billion.
Here’s a link to the article; http://tinyurl.com/6ddfdc
Here’s a link to Halderman Farm Services that shows recent farm sales prices:
I’d ballpark that the price of farm land is only up about 20% from three years ago, corn, soybeans and wheat prices have tripled in the same time period.
http://www.halderman.com/listings/saleresults.php
Haven’t you figured it out yet? This is all about the destruction of the middle class… The middle class takes away wealth from the upper class… therefore, they must be destroyed.. There can only be the upper class and the lower class… no in-between. However, the flaw in their logic is that the middle class is what gave the US it’s power in the first place.
The US Federal Reserve’s mission is to continue to enrich the wealthiest 2% of the population at the expense of the 98%, thereby systematically destroying the middle class.
Throughout this decade they have kept interest rates low, based on understated inflation rate data, thereby enabling hyperinflation of housing, energy and food costs.
Until 2007 the Federal Reserve at least paid lip service to “fighting inflation”. When they started the latest round of interest rate cuts last August, the Fed flat out ignored inflation and kept the cheap money flowing for the 2% to buy foreclosed houses at 50 cents on the dollar, and speculate on commodities.
The problem with foodstamps is you are not allowed to have savings or a 401k. Also, they will deny you on the value of your automobile.
You have no choice with government aide. You have to be piss poor or you do not qualify.
So to eat most people would have to give up their car and other assets.
I do not blame them for going to the church’s.
The government also looks at last years earnings to make extra sure no one qualifies for anything.
If we need healthcare and do not have it we can check into the local emergency room and pay a bill of $15,000.
What a bargain. Yet Bush has plenty of money to send overseas and can send it quickly too.
“There is the vast public subsidy of the ethanol boondoggle that has greatly increased the cost of agricultural land. And then the occupation of Iraq playing a major role in the increase in oil prices, which in turn increase food costs.”
Capitol Hill’s traditional engagement in “stupidology” brings in more campaign contributions from the “pigs at the trough” who would have to settle for lesser profit margins if our lapel pin-wearing rubber stamps actually engaged their minds in practical problem-solving.
And if you believe that government statistics are accurate and reflect what is really going on in the economy and job market, you might reconsider after reading the folling link:
http://www.financialsense.com/fsu/editorials/cherniawski/2008/0502.html
Poor people have been waiting for a long time for the middle class to get angry. It was not the poor people who rebelled during the French Revolution, it was the middle class. The middle class has been bought off with cheap Chinese goods and easy credit for quite some time now. But if they have to stand in line with their unwashed brethren for food in church basements maybe they will start to wake up.
There is no money for food only for tax cuts.
God blesses the poor.
Bush blesses exxon-mobil.
Unchecked capitalism is an ever-expanding cancerous blight on humanity.
In a global economy, the american middle-class will be getting a first hand view of life in the wasteland.
As we lose our ability to be good consumers, so will we lose our collective voice. Anyone know how to build a guillotine?