The other currency, Food Stamps
As we sit and watch prices rise in the food sector rise, we must all draw comfort from the fact that the price rises aren’t real, that the Federal Reserve removes the unwelcomed realities from their metrics.
The number of people on food stamps has doubled recently to circa 47 million. Let the record show that this writer is not against helping the needy nor against raising the down trodden.
Food stamps are nothing more than currency intended to purchase a small spectrum of necessary food stuffs. In theory, and Lord knows the District of Columbia is full of theory, this money goes to necessary staples. Real world machinations dictate that it also allows the user to free up other money to purchase nonessentials. The concept of food stamps for just food is in reality false. “Clerk, kindly apply the food stamps to the milk and cheese, I will pay cash for the tenderloin and sea bass and bourbon.”
Not to worry. The progressives and the Ph.Ds in DC have agreed that for every $1 given in food stamps, approximately $1.87 is generated in economic activity. Here is the Keynesian answer to economic doldrums. Gentlemen, start your helicopters!
The fact is that food stamps are currency, issued by the Department of Agriculture. As prices rise in the grocery store, and you stand behind someone swiping that funny card, one can not but think that some of that doled-out buying power is pushing up prices. Is that the idea? If so, ouch.
Just as subsidized college tuitions push up the price of college for those left out of the grant programs, food stamps certainly exert an upward pressure on food prices. As a few interruptions in production due to weather create some supply concerns, the market balance of money (and stamps) chasing foodstuffs becomes more acute.
That alleged $1.87 in “economic activity” generated for each $1 of gifted food stamps might actually be taking 87 cents out of somebody’s pocket. Check your change.