Food Stamps Create Jobs, and Other Government Delusions

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It’s hard to believe that our elected officials and the people they appoint to important jobs can be this stupid. But it’s true. They are.

Recently, Agriculture Secretary Tom Vilsack stated in a interview on MSNBC that food stamps and welfare are stimulus programs. As if that wasn’t funny enough, he went on to claim that every dollar given out in food stamps creates $1.84 in economic growth.

Are you done laughing yet?

His rationale is that when someone goes to the store and spends money, there are jobs created because someone has to grow the food, process it, package it, ship it, and stock it on the grocery store shelves. Sure, those things have to happen, but handing out welfare doesn’t grow our economy and doesn’t create any jobs.

In order for someone to receive $1 of welfare benefits, more than $1 needs to be taken away from taxpayers by the government. The person paying taxes has to pay more than $1 in order for the government to administer the program, waste a whole lot of money, and ultimately give out $1 of welfare benefits.

Obviously, there is zero positive effect on our economy. While one person has $1 to spend in food stamps, another person has more than $1 less that she or he can spend. There is no net gain to our economy, and people like Tom Vilsack should know better.

Of course, such erroneous thinking is “supported” with arguments that the “rich” will save their money instead of spending it ( and saving allegedly doesn’t help the economy), so they should be taxed more and that money should be put in the hands of food stamp recipients who will spend it. Obviously, this justification for more welfare benefits is misguided. Saving can help the economy and does help the economy because it provides capital for lending and investing. Further, it is not the job of the government to dictate how money should be spent (or not spent) by forcibly taking it away from some and giving it to others.

If you think this food stamp issue is an isolated incidence of a government official trying to perpetrate a fraud against the American taxpayers, you would be wrong.

Earlier this month, White House Press Secretary Jay Carney claimed that unemployment benefits create jobs. And he had the nerve to try to shame the reporter who asked about the issue. Laura Meckler of the Wall Street Journal asked, “I understand why extending unemployment insurance provides relief to people who need it, but how does that create jobs?”

And Carney replied:

Oh, uh, it is by, uh, I would expect a reporter from the Wall Street Journal would know this as part of the entrance exam. No seriously. It is one of the most direct ways to infuse money  into the economy because people who are unemployed and obviously aren’t earning a paycheck are going to spend the money that they get. They’re not going to save it, they’re going to spend it. And unemployment insurance, that money goes directly back into the economy, dollar for dollar virtually.

So, it … And when it goes back into the economy, it means that everywhere, every place that the money is spent has added business and that creates growth and income for businesses that then lead them to making decisions about jobs, more hiring. So, there are few other ways that can more directly put money into the economy than providing unemployment insurance.

Yet again, a government official is using faulty logic to claim that welfare benefits create jobs. Every $1 of unemployment benefits paid out requires more than $1 to be taken away from a business. There are all sorts of costs in administering these benefits, and there is no way that the economy is better off if we take more than $1 away from a business forcibly and give $1 to an unemployed person.

If these clowns were right about food stamps and unemployment benefits, wouldn’t our economy be better off simply by handing out such benefits to everyone? I mean, let’s print a bunch of money and hand out food stamps to everyone…. especially since one of the clowns is claiming that $1 of food stamps creates $1.84 of economic growth.

Let’s be honest. Welfare programs don’t work. If they did, there would be an ever decreasing need for them. Welfare recipients are dependent on others, and they don’t contribute to the economy. In order to provide welfare benefits to the dependents, money must be taken away from others who rightfully earned it but do not get to choose how to spend it. We don’t need more welfare. We need more contributing members of society. (I’m not arguing here that welfare should be abolished, just shooting down the idea that somehow welfare programs create economic growth.)

And no, this isn’t the first time we’ve heard such nonsense. Last year, House Speaker Nancy Pelosi claimed that unemployment benefits create jobs. She said unemployment benefits “inject demand into the economy” because people with money to spend keep our economy going. She claimed unemployment “…creates jobs faster than almost any other initiative you can name.”

More faulty logic pretending that taking money away from some and giving it to others magically creates jobs.

And lest you should forget, not only are our government officials misinformed about what creates jobs, our government has skilfully failed to actually create jobs and improve our economy through stimulus programs. That’s why we shouldn’t let these clowns decide how to spend our hard-earned money. We need to be taxed less… and then decide how to spend our own money.

6 thoughts on “Food Stamps Create Jobs, and Other Government Delusions

  1. This is the same argument used to make the claim that “teachers and public employees are taxpayers, too”. In the net, they are not tax payers, but rather tax receivers. If I recall correctly, only about 25 cents of every dollar budgeted to welfare programs makes it to the recipient. If that is the case, then this idea that unemployment compensation, welfare and other giveaways create jobs becomes obviously ludicrous. So, in net, that $1.84 comes from a $4.00 tax input and consequently is $2.16 negative.

    Another way to put this is, if they are correct, why not give more people welfare? What a booming economy we would have then! And while we are at it, why not make the minimum wage $100,000 per year? I mean, it’s only fair, right? And since artificially inflated wages have no effect on jobs and the economy, it should be no big deal….right? I SAID RIGHT!?!?!?!?

  2. JustThinking

    If every dollar in food stamps generates $1.84 in economic growth, then let’s give $1,000 in food stamps every month (about $33 a day) to every American. With 312 million Americans, that would cost $3.7 trillion a year, but it would generate $6.9 trillion a year in economic growth. So if it increased GDP $6.9 trillion, and tax receipts are about 19% of GDP, then tax receipts would be about $1.3 trillion. But that’s about $2.4 trillion less than the cost of the food stamps, which means it would add another $2.4 trillion a year to the national debt. I must have missed something, because surely Obama’s czars wouldn’t mislead us on this expansion of the Hope and Change policies.

  3. Smart person

    What? You guys are crazy; Welfare programs make sure that the unemployed can not only get by, but ensure they spend. Spending is good for the economy, taxation becomes entirely irrelevant. You guys are implicitly saying that saving = stimulus, that’s pseudoscience. Stop watching the Faux News and get the real info.

  4. Tracy Coenen

    LOL – Taxation is entirely irrelevant? Except for the fact that people have to be taxed (i.e. the money they earned by their own hard work is forcibly taken from them) in order to provide welfare progams.

    Unless “smart person” is right… in which case no one should work and everyone should be on welfare because their spending would be good for the economy and taxation would be irrelevant.

  5. “Smart Person” forgot something. Only about 25% of taxes collected for welfare programs get to the intended “user”. The rest is sucked into the bureaucracy. So, wouldn’t it be better to have the owner of the property (earnings) spend all of it, rather than have someone on food stamps spend 25% of it?

    Real info? A word to “Smart Person”: If you have to advertise it, it probably ain’t so.

  6. get over it

    Salary of the US President ……………….$400,000
    Salary of retired US Presidents ………….$180,000
    Salary of House/Senate …………………..$174,000
    Salary of Speaker of the House …………$223,500
    Salary of Majority/Minority Leaders …… $193,400
    …Average Salary of Soldier DEPLOYED IN IRAQ $38,000
    I think we found where the cuts should be made !

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