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The Safety Net: An Investment In Kids

Hilary W. Hoynes, University of California, Davis and Diane Whitmore Schanzenbach, Northwestern University - Posted July 1, 2013


Amidst the slow recovery from the Great Recession, some lawmakers have become increasingly concerned about the high rate of participation in the Supplemental Nutrition Assistance Program (SNAP)—formerly known as the Food Stamp program. Today about one in every seven Americans receives benefits from SNAP, and nearly one in three American children is a participant. Benefits average $275 per month per household and can be used at grocery stores and farmers’ markets to purchase most kinds of foods.

As Congress debates deep cuts to SNAP, this is a good time to re-assess the program’s effectiveness. According to the Census Bureau’s new Supplemental Poverty Measure, in 2011 the SNAP program lifted 4.6 million persons, including 2.1 million children, out of poverty; only Social Security and the Earned Income Tax Credit did more to directly reduce poverty.

But our new research finds that, in addition to providing these positive near-term impacts, SNAP likely pays significant long-term health and economic dividends for children who have access to its benefits. While some policymakers suggest that we have failed to appreciate the long-run harm to beneficiaries and taxpayers from SNAP and other safety net programs, our research suggests that, if anything, the opposite may be true: we have failed to appreciate the long-run benefits to participants – particularly children – and to the taxpayer from SNAP and other safety net programs.

Our research studies the introduction of the Food Stamp program – the crown jewel of the 1960s War on Poverty. The program was phased into different counties over the course of a decade, which affords us the opportunity to isolate the program’s impact. We compare children who had access to the Food Stamp program during their first years of life not only to earlier cohorts living in the same counties prior to the introduction of the program, but also to those born at the same time in counties that had not yet adopted the program.

We find that in the short-run access to the Food Stamp program improved infant health. In particular, pregnant women who had access to this safety net program during her third trimester gave birth to babies with higher average birth weights. The increases in birth weight were largest at the bottom of the birth weight distribution and in counties with the highest rates of baseline poverty.

Study after study has shown that early childhood health and nutrition is predictive of a child’s success and well-being in adulthood, so we also study whether young children with access to the Food Stamp program experienced better health and earnings outcomes in adulthood than children who had no access to food stamps. Examining adults aged in their thirties to fifties who had differential access to the Food Stamp program during their childhoods in the 1960s and 1970s, we found that adults’ health – as measured by self-reported health status, obesity, and reported diagnoses of diabetes and other chronic conditions – was markedly improved if they had access to the safety net during childhood. In particular, we found that access to food stamps mattered most in early childhood, through ages three to five.

Among women (but surprisingly, not among men) we found improvements in adult economic outcomes ranging from increased high school attainment, to higher earnings, to reduced reliance on the safety net during adulthood. This last finding is important. Our results suggest rather than the Food Stamp program creating an inter-generational “welfare trap,” the reverse is more likely true. Providing benefits to children at important stages of their development allows them to grow in ways that may help enable them to escape poverty when they reach adulthood.

This is part of a small but growing body of evidence that safety net programs targeted primarily at reducing poverty also yield health benefits. For example, recent research shows that the Earned Income Tax Credit likely reduces the incidence of low birth weight, improves maternal mental health, and reduces biomarkers associated with poor health for affected mothers. Providing vouchers to move to lower-poverty neighborhoods leads to an improvement in maternal mental health.
 
In the context of the current congressional debate, our findings suggest SNAP benefits that go to children are better thought of as an investment than as charity. Not only do these benefits reduce poverty and ameliorate the current impact of hunger when families face troubles making ends meet, but they also help prevent the lasting negative effects of experiencing hardship during early childhood. These benefits accrue to more than just the direct recipient of the benefits—the long-term improvement in health, for example, implies a decrease in future taxpayer costs for health care. By investing in children, safety net investments today may actually reduce the costs of the safety net down the line.

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Hilary Hoynes is a professor of economics at the University of California, Davis.

Diane Whitmore Schanzenbach is an associate professor in the School of Education and Social Policy at Northwestern University.

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