Food Stamps program built on borrowed cash

info@islandpacket.comNovember 16, 2013 

The recent editorial, "The economics of food stamps," promotes food stamp spending as a way to stimulate the economy. That's misleading in that it does not address or explain where the initial $5 billion giveaway came from in the first place.

In order to give away $5 billion, it has to first be either earned or borrowed. Thus, in order to do a fair and accurate economic analysis, the total cost of borrowing and repaying $5 billion has to be a part of the equation.

As anybody who has ever borrowed money can attest, the total cost of a car loan or mortgage far exceeds the original borrowed amount, and that's where the pain sets in. It is the same with federal spending done by borrowing.

Yes, it's relatively easy to observe the immediate economic effect of a food stamp spending program, but far more sobering to examine, and factor in, is how and when such borrowed money gets earned and then repaid. By the end of this current administration, the federal debt, now above $17 trillion, is expected to reach $20 trillion.

Robert Bland

Hilton Head Island

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