Tag Archives: government spending

Do the government spending cuts make any sense?


One of the biggest cuts in government spending during the most recent fiscal cliff was to cut food stamps by over five billion dollars. Makes sense! Take from the poor, but keep those triple digit salaries coming for the top officials in the government, you know the ones who don’t do anything except argue and threaten each other! And don’t forget to send the checks over to other countries to feed their hungry and poor.

Sure, I know we had to cut somewhere, but does anyone actually sit down and think about what they are doing BEFORE they start cutting.

The food stamp program feeds an estimated 48 million people in the United States every month. According to the latest figures, a family of four will lose approximately $36.00 per month in benefits. Doesn’t sound like much, but in most cases, the family was already either doing without some meals or getting help from other sources, such as food pantries to supplement their food budget. Now if the family must take more money out of their budget to spend on food, they will surely cut down spending somewhere else. How will that help our flailing economy?

In addition to cutting the food stamp program, the government will also cut down subsidies to farmers of over $39 billion in the next decade. So now we aren’t just taking away the income farmer’s receive from selling their crops to feed the poor, but also taking away any help we might give them to produce that food. At the same time, the cost of fuel needed to run farm equipment, interest on farm loans, and the cost of seed continues to rise.  Isn’t there somewhere else we could get this money from? Are we still subsidizing the billion dollar oil companies?

In the long run, these government spending cuts will reduce consumer spending and, with it, economic growth.

According to an article in the New York Times, these cuts could easily put more pressure on our already fragile economic recovery.  The article states: “Measures that grant more spending power to lower-income people generally have strong effects throughout the economy because the money is spent immediately and then re-spent. Moody’s Analytics has estimated that every additional dollar spent on food stamps generates about $1.74 in economic activity.”

Even more harm will be done if unemployment benefits, which average $260 a week, are cut again or stopped outright at year-end. Nearly 37 percent of the nation’s 11.3 million jobless workers have been out of work for more than six months, still higher by far than at any time before the Great Recession.

With cuts in unemployment, farm subsidies and food stamps it seems more and more obvious that the government is less and less committed to combatting poverty. I once worked for a company whose economic development strategy was that if they didn’t help the poor population, it would just move somewhere else?  Really?  How? Maybe the poor could just move to another country, then they would be able to get help from the United States government to feed their families!