Tuesday, March 29, 2011

Public benefits benefit all of us. . .

We live in a society that provides some benefits, though limited, for the poorest and weakest among us. 

That said, we often over look the fact that these benefits designed to lift "the poor" also benefit the rest of us. For example, SNAP funds (food stamps) are spent in retail grocery stores who benefit from the purchases the public benefits make possible.  SNAP is a huge positive to Kroger's bottom line, resulting in jobs, dividends to share holders and economic growth in the community overall. 

What is true of SNAP funds is also true of other public benefits received by low-income families.  In fact, one of the quickest methods for injecting life into any economy is by means of direct benefits to those at the bottom of the economic ladder.  For some reason most of us don't understand or give much thought to this economic reality. 

Texas is not too proficient at claiming the benefits from the federal government that should be coming back to us.  I say "back," because the benefits are funded by taxes we've already paid.  When our state fails to enroll, certify and qualify eligible persons for the benefits for which they qualify, the result is a significant capital lost to our state's economy. 

And, it is clear that our record of recovering those benefits is not good. 

Here's the sad news about Texas and unclaimed federal dollars across a broad array of public benefits annually: 

SNAP (food stamps) $2.4 billion unclaimed

Energy assistance  $568.7 million unclaimed

Childrens' Health insurance  $1.2 billion unclaimed

Children's Medicaid  $866.2 million unclaimed

Adult Medicaid (aged & disabled) $523.6 million

Medicare Part D Low-Income RX  $236 million

Pell Grants for college tuition $349.3 million

For a grand total, conservatively estimated at $6.1 billion annually!

We fail to enroll all of the eligible participants and we loose the funding for Texas.  As a result, tax dollars that I pay leave Texas and benefit other states.  During tough economic times for our state, this loss is completely unacceptable. 

In addition, each of these funds, once claimed and spent, possess and exhibit a "multiplier effect" in the economy.  In other words, these funds and their impact on the economy multiply as they circulate and are spent and respent through various sectors of our economy.  

Here's the multiplier factor for several of these funds designed to assist the poorest and weakest among us:

SNAP (food stamps) spent in retail grocery stores has a multiplier effect of 1.95 per dollar spent.

CHIP's multiplier effect is 3.17 per dollar spent.

Adult Medicaid--3.17 per dollar.

Energy assistance--2.25 per dollar.

Pell Grants--3.15 per dollar.

Medicare RX--2.67 per dollar. 

The overall impact of these public benefits beyond the aid to poor families themselves includes a stimulus to the economy of the state in real dollars and in new jobs.  When we fail to draw down these benefits, we fail our own economy and we act in opposition to our own interests as tax payers.

We can do better. We should start by simply understanding the reality behind the numbers.


Laura said...

Larry, what is keeping TX and Texans from collecting those benefits? I have some suspicions but would love to hear your point of view

Appreciate you-
Abilene, TX

Brian said...

I just wanted to thank you for this blog. Of course this is just a small part of your ministry, but I've been reading it now for about four years, and slowly but surely I've been transformed by your consistent, compelling advocacy on behalf of the people society wants to leave behind. Of course, the things you argue for aren't just for their sake . . . the society you are working to create is one that has the potential to bless all who are a part of it! I see that now. Keep up the good work!

Larry James said...

Laura, at best a terribly inadequate enrollment/certificaiton infrastructure. At worst. . .well, I won't go there, but it is not hard to figure out how the best relates to and serves the worst, huh?

Larry James said...

Brian, thanks for your kind words.

Chris said...

The Heritage Foundation did a study a couple of years ago.

The number of Americans dependent on government for their daily housing, food and health care is more than 60 million. We are rapidly approaching the point where more than one third of Americans do not pay federal taxes for bendfits they receive. In 1980, 20 million tax filers paid no taxes; in 2008, 48 million paid nothing. Since 2001, dependency on government has soared 31%.

Starting in 2016, social security will not collect enough taxes to pay all the promised benefits; this spells serious trouble for HALF of the American workforce that has no other retirement program.

America was founded on the independent spirit. Do we want to be a nation of dependency? I certainly hope not. We do not want to be another Socialist Europe, who by the way are trying to reign it in.

Brian, I do not see a nation beholden to the benevolent government has the potential to bless anybody. It will make us slaves.

Anonymous said...

At what juncture does integrity play a part in your actual, daily life? What kinds of oversight is in place to ensure your organization is skimming off the top and benefitting from the plight of economically-disadvantaged people? Personally, are your hands clean of impropriety in how you deal with constituents you clearly benefit from?

Anonymous said...

Last Anon:

Wow! You get the prize. That was just weird.

Larry James said...

Anon 543, we embrace many and various accountabilities with all our revenue sources, as well as our program outcomes. I feel very good about the scale, scope and depth of our engagement and partnerships with low income families. Last year we assisted over 53,000 different individuals. We provided stable housing for almost 200 formerly homeless persons including wrap around services, job training in construction skills with over 70%+ landing jobs, etc, etc, etc. Come see me and I'll show you. As for my personal integrity, I will leave that to the one I attempt to follow, even if faltering.