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Jan. 19

The Good Economics of Hunger Relief: Part 2

Posted by cmurphy
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David LeeToday's guest post is a continuation of yesterday's post about hunger in the U.S written by David Lee, the Director of Government Relations and Advocacy at Feeding America, the nation's largest anti-hunger charity. Today David looks at the benefit of federal hunger relief programs and the way our nation structurally deals with hunger.

Yesterday, we examined the costs of hunger to the American economy in terms of human capital, productivity, and healthcare costs.  Though these costs are high, they are peanuts when compared to the general losses incurred by business due to hunger.  In other words, when people are hungry, they do not have enough money to food.  And when people are not buying food, it is very likely that they are not buying other things that businesses are selling.

This is why the federal nutrition programs, such as the Supplemental Nutrition Assistance Program (SNAP), The Emergency Food Assistance Program (TEFAP), the National School Lunch and Breakfast Program, and WIC, among others, are such cost effective investments: they provide the people who qualify for them with the means to participate in the economy.

From the macroeconomics perspective, let’s take a look at SNAP (formerly known as Food Stamps) which creates $1.79 in economic activity for every $1.00 of benefit.  Since SNAP benefits can only be redeemed for food, recipients are then able to use the money they would have had to use to buy food for other things like buying car insurance, paying rent or the electric bill.  And since they are buying food – which they otherwise might not be – grocery stores are able to keep workers employed, which then keeps truck drivers employed, which keeps processors working, which keeps farmers working, etc.  In fact, according to a recent report by USDA’s Economic Research Service, every $1 billion of retail demand by SNAP generates $340 million in farm production, $110 million in farm value-added, and 3,300 farm jobs.

From the microeconomics perspective, let’s look at me: As a first generation immigrant, I grew up eating free-and-reduced price lunch in school.  That helped my parents save just a little more money which allowed them to open their own small business, which allowed them to achieve the American Dream of buying a home.

This is the uniqueness of hunger relief from a business perspective: ensuring that everybody has access to a minimum middle class diet expands markets and creates economic opportunity.  When people have enough to eat, they are healthier, smarter, and more productive, and become more efficient participants in the economy.

In these difficult economic times, public nutrition assistance programs are cost effective investments that must be protected, if not increased.  They are highly efficient, with low overhead, and they not only provide a basic human need, they also help beneficiaries become better participants in the economy.  Our food banks and emergency food providers certainly complement and support the public nutrition programs but they cannot do it alone.

Working together, in a mutually supportive partnership, the national public and private food assistance systems can create more vibrant communities by preventing the unnecessary health, economic, and business problems associated hunger.

But what can you do about it?  Think about the impact hunger has on your friend, your neighbor, your community, our national economy, and our future.  Food banks across the country are facing historically high need, and at the same time, struggling to keep their shelves stocked due to declining food streams and high food prices.  Whether you can give your time, your voice, or your money, you can make a difference for your community and the health of our nation by helping to ensure that struggling families simply have enough to eat.

Find out how you can help your local food bank by visiting www.feedingamerica.org.  You can also sign up to be an anti-hunger Champion at www.hungeractioncenter.org.  For online advocacy tools, please visit www.feedingamericachampions.org.

Please comment below with your questions/opinions regarding the issue of hunger in America and all over the world.

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