According to Obama administration Ag Secretary Tom Vilsack, food stamps are good for the economy. According to Vilsack, for every $1.00 spent on food stamps we see $1.84 in production.
So I guess that’s the solution for the economy, right?
Step 1: Put every one on food stamps. Step 2: Prosper.
So how can the Obama administration conclude that food stamps have a multiplier effect in the economy? After all, food stamps are paid for with tax dollars. In order to spend money on food stamps, money must be taken from someone else. Thus, at best, the impact of food stamps on the economy should be neutral.
But I think what the Obama administration is doing is failing to recognize the economic impact of taking from the economy to fund food stamps. If you erase that side of the equation, of course you’re going to find a net positive economic impact. But, in the real world, you can’t ignore it.