Republicans are proposing significant changes to food assistance, which could impact supplemental nutrition programs for older adults, school lunches and the agriculture industry. What will the cuts mean for hunger and nutrition in the U.S.?
Guests
Joel Berg, CEO of Hunger Free America, a nationwide anti-hunger advocacy organization.
Kevin Corinth. senior fellow at the American Enterprise Institute.
Philip Brasher, editor-in-chief of Agri-Pulse, an industry publication covering food and agriculture policy.
Also Featured
Stacy Dykstra, CEO of the Regional Food Bank of Oklahoma.
David Horst, an Oklahoma resident who has relied on SNAP in the past.
Transcript
Part I
MEGHNA CHAKRABARTI: We are in day three of our weeklong look at the One Big Beautiful Bill Act, the Congressional Budget Reconciliation Bill that could make huge changes to the lives of tens of millions of Americans. Now before we actually get to today’s topic, which is about food insecurity, I want to take a moment to answer a question that several of you have actually sent to us already.
Why are we calling it the One Big Beautiful Bill Act? The simple answer is because that is what it’s called. That’s the official title of the legislation. It’s House Resolution one of the 119th Congress, One Big Beautiful Bill Act. Now we follow the journalism standard of calling legislation by its official title on first reference, and then on subsequent references by a common nonpartisan name, and in this case, the common reference I will use is budget reconciliation bill.
Now I hope that answers the question many of you sent in and I’m very grateful that you did, by the way. So please keep sending us your questions and comments about anything really, but especially about the budget reconciliation bill.
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And the best way to do that is via the On Point VoxPop app. That’s On Point VoxPop, and you can get it wherever you get your apps. Okay, now onto today’s topic in the One Big Beautiful Bill Act, food and nutrition assistance. In the United States, about one in seven households face food insecurity, and that’s according to the U.S. Department of Agriculture.
USDA defines the term as having limited or no access to nutritionally adequate and safe meals. And many of those American families rely on the federal Supplemental Nutrition Assistance Program or SNAP. That’s what Oklahoma resident David Horst did when he left work to go to school, got married and had a kid.
DAVID HORST: With the income that we were making at the time, it was an amazing help. It really did its job of stabilizing and helped us as we helped ourselves get up.
CHAKRABARTI: Families apply for SNAP assistance through their home state. And in general, you qualify if your income is under 130% of the federal poverty line, which for David’s family is about $33,500 per year.
SNAP assistance allowed him to purchase milk, beans, peanut butter and other food for his family. And by the way, the required income level is adjusted up or down based on the number of people in a household. Now, David’s family also received help from the Women Infants and Children Program, or WIC. That’s another program through SNAP, specifically for helping pregnant women and new mothers, plus children under five.
HORST: Because of that supplement, it really took weight off the shoulders and allowed us to focus on some of the other needs that came up. If you had an unexpected bill, this would turn what would be probably an inconvenience for the typical person into a disaster, if you didn’t have that little extra wiggle room in our case.
CHAKRABARTI: David now works as a civilian employee for the U.S. Air Force and is no longer receiving SNAP benefits. He says he is grateful for the programs, and he’s concerned about some of the potential changes to SNAP that are proposed in the budget reconciliation bill. The House version of the bill proposes a nearly $300 billion cut to SNAP or about 30% of the program’s budget.
The bill also includes expanded work requirements for many older Americans. Now currently, SNAP assistance already requires most people between the ages of 18 and 54 to prove that they are working or attending job training for at least 80 hours per month. The One Big Beautiful Bill Act would raise that age from 54 to 64.
Pennsylvania Representative Republican GT Thompson said back in April that he believes that changes restore dignity to the working class.
GT THOMPSON: I’ve long been an advocate of the SNAP program and the helpful hand it provides for our neighbors in need. But I hope we can all agree on our responsibility as members of this committee, that we take every action possible to enable more people to move into long-term employment while meeting their nutritional needs.
The safety net has become a spider’s web. And too many of us, too many of our most vulnerable Americans are trapped. I refuse to believe that they are all destined to live lives of government dependency.
CHAKRABARTI: The bill would also require states to pay for at least 5% of Snap’s local operating budget. Right now, states pay 0%.
Certain states would be on the hook for a quarter of those costs depending on how efficiently they are currently managing SNAP. We’ll take a look at that in a bit. Now there is some discomfort about those work requirements in the Senate. The Senate Agriculture Committee unveiled its proposal last week, and that one would dial back those work requirements.
Also, some other senators fear the bill could bankrupt their states, and they’re proposing leaner cuts that will be debated in the coming weeks in the Senate. In Oklahoma, listener David Horst says no matter what, any cuts to SNAP would hurt his neighbors.
HORST: I am a conservative. I am a Christian. I would say while I’m registered Republican, I would call myself a disenfranchised Republican.
If I was to have a serious conversation with somebody about this, I would probably ask them, we have in the Bible and Luke says, to who much is given, much will be required. When you are in a country that’s plentiful, why is it so difficult to be able to give to those who are not as well off as you.
What is painful about that to you?
CHAKRABARTI: Once again, that’s David Horst. He listens to On Point in Oklahoma. Okay, so let’s dive even further into the changes that could come to food, federal food assistance in the Budget Reconciliation Bill, and joining me now is Joel Berg. He’s the CEO of the advocacy group, Hunger Free America.
He served for eight years at USDA in the Clinton administration and is author of multiple books on hunger, including All You Can Eat: How Hungry Is America? Joel Berg, welcome to On Point.
JOEL BERG: Thank you so much, Meghna. I should also point out we are a direct service organization as well as an advocacy organization.
CHAKRABARTI: Point well noted. Thank you so much for that. Kevin Corinth also joins us today. He’s a senior fellow at the American. Enterprise Institute and Deputy Director of AEI, center on Opportunity and Social Mobility. Kevin Corinth, welcome to you.
KEVIN CORINTH: Thanks, Meghna. Great to be on.
CHAKRABARTI: So I wanted to first talk with both of you about why SNAP now serves 42 million Americans, right?
That’s more than 10% of this country and the program has actually undergone some pretty significant growth in recent years. So Joel, talk about that first. Why is SNAP becoming a larger part of more American’s lives?
BERG: SNAP is a larger part of more Americans lives because more Americans need it.
Because the American economy is failing in fundamental ways, according to our analysis of USDA data. One in 10 employed Americans live in food insecure households. So today 47 million Americans, 47 million Americans, that’s more than the combined populations of Pennsylvania, Illinois, Ohio and Virginia live in homes, according to USDA, that can’t afford enough food.
So if 47 million Americans are struggling against hunger, we shouldn’t be shocked that 42 million Americans need SNAP assistance, primarily because their incomes are too low, because their wages are too low and their expenses are too high.
CHAKRABARTI: Kevin, go ahead.
CORNITH: Sure. And I would start by just echoing everything that’s been said, that SNAP is just a foundational program that really helps low-income families and especially kids in terms of the growth.
I think Joel’s right. The economy has gone through some difficult times, especially with the pandemic and then a lot of the government mandated shutdowns, and we’re still recovering from that. I would note that it’s not a hard and fast rule that SNAP caseloads always go up when the economy does get better.
As we saw from about 2014 to 2019, we saw something like a 25% decrease in SNAP caseloads, and that’s because the economy was working really well. We saw wage growth. Especially at the bottom of the distribution. And when the economy works, when wages are going up, you do see SNAP case loads fall. So I think that’s the goal moving forward.
CHAKRABARTI: Now, Joel, correct me if I’m wrong, but were there not increases in SNAP benefits, pandemic related increases?
BERG: There were two major sets of pandemic related increases. One was based on statutory authority in the previous Farm Bill, which authorizes SNAP to allow the Department of Agriculture to increase what’s called the Thrifty Food Plan to account for higher costs of food and higher costs of living.
And that has resulted in an increase in benefits for virtually everyone on the caseload. Unfortunately, both the House and the Senate Republican bill would prevent future secretaries of agriculture from meeting those increased costs. There was a second increase in SNAP emergency allotments that was pandemic specific, and those increased allotments have gone away.
And I should just add, the average SNAP benefit now is $2.08 per meal. So anyone out there saying, oh, people are living high off the hog, eating big lobster meals with these benefits, it’s just not true.
CHAKRABARTI: $2 per meal. I’m seeing a report here from USDA that said in FY ‘23, it was an, another way of putting it, is $211.93 per participant per month.
Does that make sense, Joel?
BERG: Yeah, that sounds, it varies by month, but that’s about correct. For today.
CHAKRABARTI: Now Kevin, here’s another question getting a sense as to the size of the program. USDA reports that of all its food and nutrition assistance spending, SNAP accounts for 67.8% of that spending. And in comparison, WIC, it’s actually quite small. It’s 4%. So this is the marquee, the most relied upon program for Americans facing food insecurity. You can understand why many of them may be feeling a lot of anxiety and concern by hearing that there could be cuts to this program.
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CORINTH: Sure. Sure. And I would note, you’re exactly right that SNAP is the premier program run by USDA, but let’s not forget about school meals as well, which have not come up, which are very important for kids, both for breakfast and lunch, in addition to some summer meals program that fill the gap when school’s not in session.
And I would just want to go back to one thing that Joel mentioned on the 2021 increase. In the Thrifty Food Plan, I think a lot of people have different value judgements about what level of benefits we should provide, and maybe it should be more, maybe it should be less, maybe right now it’s good.
I think the problem that I and many others had with that is that it’s not the role of a presidential administration to make unilateral increases to SNAP benefits. That should be a role for Congress and whether President Biden or President Trump is in power I think it’s important that role, that value judgment is reserved for the Congress.
So I wanna make that, go on record on that as well.
Part II
CHAKRABARTI: Shawna Trader is from Barre, Vermont and he has concerns about potential food assistance cuts, and he says he already makes up to a quarter of his monthly budget food spending, even though he has SNAP.
SHAWNA TRADER: I already go to food banks. I already take advantage of as many free meals and free food as I can, and without SNAP it would mean less food in the home.
And especially less nutrient food. I use that. I use those benefits to cook a lot.
CHAKRABARTI: And here’s listener Amadeo Rehbein-Verhoeven from Salem, Oregon.
AMADEO REHBEIN-VERHOEVEN: SNAP cuts or any changes to eligibility in the program would affect me. Leading me to eat less than I already do, and probably worse than I currently do. Food boxes take a while to get in this area just because everyone’s struggling and SNAP means a little bit of independence.
It means that I go to work fully fed and fully alert, able to pay attention, and any cuts to the program feel like political theater.
CHAKRABARTI: Now the House passed Republican reconciliation Plan proposes $300 billion in cuts to SNAP through the year 2034. That’s according to the Congressional budget office.
It would be the largest cut to SNAP in the history of the federal program. So one of the ways in which it’s doing that, and Joel and Kevin. Gonna turn to you for your views on this, is reducing the federal contribution to state’s SNAP program. So that’s that administrative cost that we talked about earlier, and that states would have to actually just pay more or actually something to administer SNAP locally.
Joel, what’s your concern about that?
BERG: My concern is states are either going to have to raise taxes or cut food to people who desperately need it, and in most cases the latter will happen. It’s really vital to note that red states that supported President Trump and tend to support Republicans for statewide office tend to have higher percentages of their state population who rely on these programs, particularly SNAP. The federal minimum wage $7. 25 cents an hour hasn’t increased in 26 years, and red states tend to have lower minimum wages and lower wages overall. So my concern is there are already 47 million Americans who are food insecure.
And keep in mind, America has the highest level of hunger and food insecurity per capita out of any industrialized western nation. Because we have lower wages and a less robust safety net. And if this occurs, we will have mass hunger in America, primarily to pay for tax cuts for the mega rich.
CHAKRABARTI: Now, Kevin, as Joel’s saying, the concern is that increased state responsibility for SNAP administration would force those states to take away from potentially other programs or assist fewer people with food help. Your response to that.
CORINTH: Look, I think this is an important major change to SNAP if it were to go through.
Historically, the federal government has funded all of the benefits paid to families. This would not give states a large share of the cost burden, but a 4% or 5% that could go up as erroneous payments increase. So I think it’s valid there’s some concerns that’s about states, but there are some benefits of this as well.
One issue that we’ve had with SNAP is that states don’t really have skin in the game in terms of making sure that benefits are going to the right people and the right amounts and that they’re enforcing work requirements when they’re supposed to be. And I think this would give them more of an incentive to preserve program integrity.
And the revenue that’s going towards SNAP has to come from somewhere, whether that’s at the federal level or the state level. And so we have to pay for this program. I think it’s a worthy investment, but I don’t think it’s unreasonable to ask states to pay a small share for it.
CHAKRABARTI: Kevin, what is your analysis of how much misdirected funds there are? The waste, fraud, and abuse that lawmakers talk about in SNAP.
CORINTH: Sure. And a lot of the mispayments aren’t always necessary to fraudulent purposes. They can just be accidents. And we wanna minimize that as well.
So to me, it’s more around enforcing some of the work requirements in particular where states are work requirements when they really shouldn’t be. There’s places, California’s sort of the king of this game, where they’ll gerrymander areas together, and there’s been counties with unemployment rates below 3% that have not been enforcing the work requirement because that county has been gerrymandered with other ones.
And so I think it’s giving states more incentive not only on the mispayment issue, but more importantly to me on enforcing work requirements when they should be in place.
Joel, I’m gonna let you respond to that in just a second, but I want to highlight how much the allegations of waste, fraud, and abuse are driving the desire for these major cuts in SNAP from the Trump administration and Republican lawmakers.
Here’s agriculture Secretary Brooke Rollins at a House committee hearing just a few days ago about why she sees a need to reform SNAP and she says too many people have enrolled in it, in her opinion, despite low unemployment.
BROOKE ROLLINS: The last time we had this unemployment number in America, which is low, the last time we had 17 million people on SNAP.
Today with the same unemployment number, we have 42 million people on SNAP. So the exponential growth of this program, especially over the last four years, a 40% increase in the last four years is going to bring with it the fraud and the waste and the abuse that we have got to counter.
CHAKRABARTI: Joel, if you had been sitting next to her providing testimony, what would you have said?
BERG: Full disclosure, I have many concerns about the Secretary of Agriculture and my organization’s actually suing her with the help of Public Citizen, because on eight hours’ notice, they eliminated our contract to run the National Hunger Hotline, helping tens of thousands of Americans access private and public sources of food.
But she once said between 30 to 40% of SNAP is waste, fraud, and abuse. And that’s just false. Not even close to true based on her own numbers. USDA’s numbers show about 2%. 2% of the program is wasted with trafficking actual fraud. Some of the missed payments are actually underpayments.
Low income people are getting less than their legally entitled to. And I do wanna jump into the issue of work requirements. Why are we so obsessed with low-income people Getting $2.08 a meal. No discussion of work requirements for the trust fund kids who our tax dollars paid a ride round in private jets with government funded air traffic control.
Kevin, I’ve never met him before. Sounds like a very smart, caring man. But I read a lengthy paper he wrote, analyzing in depth how much time supposedly Medicaid recipients spend playing video games. And I just don’t see that attention on the programs going to wealthy people, even the farm subsidies and Phil Brasher, who’s gonna be on later, an excellent reporter, knows these programs, can tell you there was a GAO report that these farm subsidies, some of which go to the same entities, decades in a row, millions of dollars a year.
25%. 25% of the people who get those subsidies do no physical labor on their farming operations. So I just wish we could have a broader conversation about rewarding work for everyone, raising the minimum wage, strengthening their earned income tax credit, have job training programs that really help people move towards living wage work, aren’t just giveaways for politically connected contractors. Let’s really discuss rewarding work, not punishing low-income people for the supposed sin of being poor.
CHAKRABARTI: Kevin, just to add a little question here to what Joel said, especially the raising the required age of work by a decade up to age 64, there comes a point in which we, one does wonder.
Why? What benefit do people get who’d actually be in the last years of their working lives, maybe to have to work in order to get assistance to put the bare minimum food on their table.
CORINTH: Sure. And let me answer this whole question about rewarding work, which I agree is extremely important.
And fortunately, we do have a safety net that’s comprised of not just SNAP and other nutrition programs, but many other programs like the Earned Income Tax Credit, which provides about $7,000 a year for a family with two kids. The refundable portion of the child tax credit, which provides about $3,400 per year for families with kids. We have housing assistance.
We have, of course, the Medicaid program, which you mentioned, cash welfare and the list goes on. So we do have a lot of other programs that have done actually a very good job of rewarding work. And I think do a better job than the minimum wage, because I worry that can have employment loss especially when you oppose a federal minimum across the whole country.
In terms of moving up to the age to 64, from the original point of 54, which we have today, I think it reflects society’s expectation that working age is up to age 64, 65 is the first age you can retire. Some people are going beyond that. And work requirements are popular.
At the end of the day, this is a sort of a value judgment about what you think is the societal expectation for people who receive government funds. And when you poll Americans, they typically favor work requirements for things like SNAP.
CHAKRABARTI: Yeah, I hear what you’re saying. I don’t, just don’t understand why we don’t pass that same value judgment for things like corporate welfare.
To the point that Joel was making, it seems as if the shaking of the finger comes if you’re a lower income American, Kevin.
CORINTH: Sure. I’m not exactly sure what you mean by corporate welfare. Certainly the Tax Cuts and Jobs Act did reduce corporate taxation. And there’s other important provisions including in the Big Beautiful Bill Act.
CHAKRABARTI: So let me clarify. You’re right about me not having been clear. Okay. So in 2017 when let’s say the corporate tax rate was dropped the idea is, that money. Would be used to be put back into the US economy, right? To help grow the country as a whole.
That didn’t happen. The companies did a huge bunch of stock buybacks. We know that. But so maybe the same idea exists for people relying on SNAP benefits, that you get a benefit from the federal government with the sort of moral exchange that you also do your part in working in your community.
I get that. But then see that didn’t happen with America’s biggest companies. And no one really got that upset about it. At least no lawmakers did. And so why do we have, why do we like expect Americans who can’t put food on the table, or even if they were working, would still need SNAP benefits to adhere to some kind of higher moral standard?
CORINTH: So I think we’ve maybe been reading different research. From what I saw after the Tax Cuts and Jobs Act, we saw an enormous decline in food insecurity and poverty. We were seeing record increases in wages at the bottom. And that’s exactly what the research has predicted.
When you reduce corporate taxes, a lot of that is passed on to workers. And as a result, we did see improvements in the exact outcomes that we’re worried about for low-income Americans. In 2019, SNAP caseloads were falling and people’s incomes were growing and food insecurity was falling as well.
So I think those are the goals we care about. And if we care about those goals, it’s important to have a tax code that rewards investment, which means more jobs and higher wages.
CHAKRABARTI: Okay. I’ll go back to you, Joel, here for a second. But Kevin, thank you for asking me what data I was looking at, I’m referencing at least one report.
This one particular from Goldman Sachs which found that there was a 55% jump in stock buybacks in 2018 over 2017. Companies in the S&P 500 spent $806 billion in stock buybacks in 2018. So those are the numbers I’m looking at. But Joel, I didn’t mean to box you out here. Go ahead.
BERG: Let’s talk about the mortgage interest deduction. I get one for my co-op in Brooklyn, but you can get it for your vacation home. So our tax dollars are subsidizing wealthy people having vacation homes. And let’s be clear, these aren’t just work requirements. These are work reporting requirements.
Most able-bodied adults on SNAP already working. So sometimes these requirements force people to leave work. Sometimes lose wages to either call or email or sometimes visit person, a government office to prove that they’re virtuous enough to get this assistance.
This administration is trying to cut nutrition education funding, actually eliminates SNAP Nutrition education program, and yet it’s telling states, oh prevent low-income people from occasionally buying a soda with SNAP. Even though I can tell you having worked there, USDA’s office buildings all have soda machines. All the Capitol Hill office buildings have soda machines.
So I’m just sick and tired of this double standard for low-income people, that the people working hard and playing by the rules who are being shafted by this system. Because their bosses aren’t paying them a living wage so they can buy enough food. Then turning around saying they’re getting too much.
CHAKRABARTI: So Joel, let me push back on something that you said, and Kevin was getting to this point earlier. Why shouldn’t states be more responsible for a more efficient administration of SNAP? There’s more, they have more skin in the game for other forms of federal assistance.
Why not SNAP?
BERG: It’s important to note the history, that the whole reason states are running SNAP and states are running programs like cash assistance is because Southern segregationists, who at the time were mostly Democrats, wanted to make it easier for states to keep food away from low-income people.
We don’t have states pay for part of our military. We don’t have states pay for part of our social security system. If something is a national priority important to people all throughout the 50 states, then the federal government needs to pay for it.
CHAKRABARTI: Kevin, you wanna pick up on that?
CORINTH: Sure. And I do want to just come back, because a point of agreement here on the mortgage interest deduction and actually the state and local tax deduction, which were greatly weakened as part of the Tax Cuts and Jobs Act in 2017.
I think I am fully on board with eliminating those programs. In terms of state administration of SNAP, we, we do have the example of Medicaid where states pay actually a larger portion than they would be required to under SNAP. They pay up to about 40% or more depending on the population.
So I don’t think it’s unprecedented. I think it’s important to give states lead time, which I think the bill does give a couple of years lead time to figure things out, to make sure that they have the revenue in place, especially those with balanced budget amendments.
But it’s a way to increase the incentives for states to have more concern over program integrity and especially, in my view, enforcing some of the work requirements.
Part III
CHAKRABARTI: Stacy Dykstra is CEO of the Regional Food Bank of Oklahoma, which together with another major food bank network, serves the entire state of Oklahoma. And Stacy says it’s very unlikely that Oklahoma would be able to afford to take on a chunk of SNAP operating costs.
STACY DYKSTRA: Right now, we’re estimating that it would require $224 million in new state spending in 2028.
And that’s the equivalent of 84 million meals, and that is more meals than both food banks together distributed last year. So if you think about, so obviously I think, you’d say, okay, so food banks can’t make up this thing. The state doesn’t have that kind of money. It is so scary.
That’s what keeps me up at night.
CHAKRABARTI: Alright, let’s turn our attention to another aspect of America’s food system. And that is farmers. Agriculture Secretary Brooke Rollins highlighted the ways she says USDA will actually increase its help for farmers. She did so on June 11th in a House committee hearing.
She talked about boosting subsidies for commodities like corn, soybeans, cotton, by raising something called the reference price that USDA uses to pay farmers.
ROLLINS: I can’t say enough and have been making this case to anyone that will listen. That this big, beautiful bill is important for a lot of reasons.
The president’s tax cuts being permanent, creating more jobs, keeping the death tax out of our family farms, et cetera, et cetera. But I’m not sure from my perspective and this job that there’s anything more important than updating those reference prices. So I’m very proud of that.
CHAKRABARTI: Alright Philip Brasher joins us now.
He’s editor in chief of Agri-Pulse. It’s an industry publication that covers food and agriculture policy. Philip, welcome to the show.
PHILIP BRASHER: Hi, Meghna.
CHAKRABARTI: Okay, so what are, yeah, it’s great to have you. What are the changes that the budget reconciliation bill would bring to the lives of American farmers?
BRASHER: Okay.
It’s important to be clear, and you said this in your introduction, that this primarily has to do with farmers who grow corn and soybeans, wheat, rice, cotton, these large scale row crops. And also to some extent dairy producers. And it would increase basically, strengthen the safety net, the income safety net that they have in various ways.
CHAKRABARTI: How would it do that?
BRASHER: One of the most important ways is what the Secretary Rollins was just referring to. And that’s what are called reference prices or basically floor prices. There are a couple of programs, but the way that one of them works is that when market prices in a given year fall below a certain level, fall below the reference price, that triggers payments to farmers who have traditionally grown that type of crop. The complaint that too many farmers have is that these reference prices are too low. They don’t reflect the fact that production cost of increased significantly over the past decade since they were initially set.
CHAKRABARTI: It increases that reference price, meaning that delta that farmers would get paid by the federal government grows essentially?
BRASHER: Yes. It increases the likelihood that they would receive a payment in any particular year.
CHAKRABARTI: And when, do you know when the last time that reference price was increased?
BRASHER: It’s complicated.
They were basically set in the 2014 Farm Bill. Those base prices have not been increased since then. However, there is, I say it’s complicated because there is a formula by which those, the effective reference price in a particular year can be higher depending on what has happened to commodity prices over a five-year period.
It’s complicated. So the actual price in any given year, but the base prices were set, reference prices were set in 2014.
CHAKRABARTI: Agriculture is this huge industry. Who is this really going to help the most? Because when I say farmers, it might conjure up the image of a small American farmer.
But it sounds like especially since these are for commodities, that agribusiness would be the big winner here.
BRASHER: It depends on the part of the country that you’re talking about. In the Midwest, it could easily be a farm with 1,000 to 2,000 acres. A son, a father, and maybe a son, maybe several children who are farming it.
In the south you tend to have even larger farms, just the culture and how things have developed over the years. But you could have smaller operations as well, but they have tended, the middle, mid-size farms have been tended to be hollowed out over the last several decades.
So you tend to have just larger and larger farms that grow these commodities. Keep in mind that there are payment limits, so a very large farm can only get a certain amount of money in a particular year. So there is some limitation on very large operations.
CHAKRABARTI: But, so correct me if I’m wrong though, because I’m seeing some analyses here that says the bill would increase subsidies to 14 companies that do business administering farm insurance. Is that right?
BRASHER: There are companies, increasingly, you have financial services companies that come in and get payments that basically channel through producers.
that there were payment caps at least seems like there’s at least some proposed increase in those payment caps that would be raised from $125,000 to $155,000 per person.
BRASHER: Right.
Yeah, exactly. And that’ll be in indexed to inflation, so that can increase as well. That’s another one of the changes that this bill would make.
CHAKRABARTI: Okay. And then another, both bills, actually both the House and the Senate bills.
CHAKRABARTI: Okay. Got it. And then I had mentioned, soy and corn, those are the sort of the most easily identified commodities.
But the bill would also expand subsidies to dairy, poultry, forestry, biofuel rural schools and other activities. Is that right?
BRASHER: That not really, primarily in terms of the farm programs that are receiving the extra money. $60 billion in case of the House bill, $67 billion in case of the Senate bill.
The bulk of that money goes into these commodity programs. Crop insurance, there also is additional money for foreign trade promotion initiatives. That’s part of it, and that benefits a broad swath of agriculture, including fruits and vegetables and other crops. There is additional support for dairy producers as well.
Kind of expanding a subsidy program that already exists for them called the Dairy Margin Coverage Program, livestock producers, and other livestock producers, and I would say cattle, hog, poultry producers. They are, for the most part, not covered by the major commodity programs, commodity support programs.
There are other programs within USDA and there is some support for crop insurance, but largely, we’re talking about these row crops.
CHAKRABARTI: Got it. Overall, it sums to, as you were saying, something like a 50 to 60 billion dollars increase in farm subsidies over the next 10 years.
So Philip Brasher, editor in Chief of Agri-Pulse, an industry publication that covers food and agriculture policy. Thank you so much for joining us.
BRASHER: Okay. Thank you.
CHAKRABARTI: Alright, so for the last few minutes of the show, we wanna turn our attention back to health care and how the budget reconciliation process could change American health care in this country.
That’s where we started this week on Monday, talking about House proposed changes to Medicare, to the Affordable Care Act and to Medicaid. Well, just recently, basically as we’ve been doing this series, the Senate has released a proposal for changes to Medicaid, so we’re gonna bring back Larry Levitt. He’s the Executive Vice President at KFF, the Kaiser Family Foundation, a nonpartisan non-profit organization that focuses on health policy.
Larry was with us on Monday when we talked about the House version of the bill. That calls for an $880 billion cut in Medicaid. And Larry, welcome back. What has the Senate proposed all of a sudden?
LARRY LEVITT: Yeah, thanks for having me back. Interestingly, the expectation was that the Senate would moderate the Medicaid cuts that were in the House.
A number of senators have raised issues about those cuts, but the language that was just released actually makes the cuts even bigger. So —
CHAKRABARTI: This did shock a lot of people, right? Because —
LEVITT: Yeah, no, this this will set up quite a debate in the Senate.
CHAKRABARTI: Okay. So what is, in this language, how are, how is the Senate proposing this?
LEVITT: Yeah, so there are a number of specific cases where the cuts are bigger. This, of course, gets wonky as one big one is what are known as provider taxes. So these are taxes on hospitals, mainly, and nursing homes in some cases that help states pay for their part of Medicaid.
The House bill put a moratorium on these taxes, so essentially said there can’t be any new taxes on hospitals and nursing homes. The Senate went further and said that they’re actually going to ratchet down even the existing taxes on hospitals. They exempted nursing homes. And interestingly, this only applies in states that have expanded Medicaid under the Affordable Care Act.
Now that’s 40 states plus D.C. So it doesn’t touch deep red states in the South that have chosen not to expand Medicaid states like Texas and Mississippi and Florida.
CHAKRABARTI: So to be clear, because again, wonky can be confusing, knowledge is power here, Larry, cutting those or allowing those provider taxes to be cut, right?
LEVITT: Yep.
CHAKRABARTI: What that means is because those are taxes that states use to pay for Medicaid, and stop me if I’m doing anything wrong here. What that means is that less money would be coming to the states to pay for those things and therefore they would have budget holes that they need to fill and would find, have to find somewhere else to offset that revenue loss.
LEVITT: That’s exactly right. This is a cost shift to states that have chosen to use these provider taxes to help fund their Medicaid programs and have chosen to expand Medicaid. So this would open up big budget holes in all of these states and force them to cut other parts of Medicaid, cut other state programs like education or public safety or raise taxes.
Although we know that’s always hard to do.
CHAKRABARTI: Have you been able to discern, I know this has just happened, but why the Senate is choosing to make these this particular deeper cut?
LEVITT: There’s been a lot of focus on the handful of moderate Republicans who have been concerned about Medicaid cuts.
But the reality is there are also Republicans on the other side who are pushing for bigger cuts in programs like Medicaid and this is to help pay for bigger tax cuts. But it’s also part of decades long effort by conservative Republicans to cut entitlement programs for low-income people.
CHAKRABARTI: To that point, I understand that of the many reports that have come out about how Medicaid is financed, there is a particular one that seems to have been quite influential in conservative circles.
It came from the Paragon Institute, which is a conservative thinktank that it’s reported that this year they had a report that came out that described this provider tax maneuver as money laundering or creating federal money out of thin air. That’s how it’s perceived by particularly conservative think tanks.
LEVITT: That’s right. And the Paragon Institute, which includes former Trump administration officials from the first term have described these provider taxes as money laundering, to be clear, they are legal.
They are, you can agree or disagree about whether this is an appropriate way for states to help pay for Medicaid. But they have been allowed by Congress, by previous administrations, Republicans and Democrats. They’re used by red states and blue states, but I think this is an attempt by Paragon to frame these Medicaid cuts as fraud, waste and abuse. And they’ve been quite successful in doing that.
CHAKRABARTI: And how do hospitals feel, because many of them are very large businesses.
LEVITT: Oh, hospitals are not happy at this moment. And this is not just, these are not just like payments to hospitals, payoffs to hospitals.
These are payments to hospitals to pay them for services they provide to Medicaid and enrollees, hospitals have been lobbying heavily. They are dependent on this Medicaid money, particularly rural hospitals which are on the edge. And they were, I think, surprised by this move by the Senate.
CHAKRABARTI: This is the thing that surprises me, because usually I would think that hospitals would be thrilled to hear that Congress wants to reduce taxes paid.
LEVITT: Yeah, that’s where this gets even more complicated. Because these, excuse me, these taxes paid by hospitals help states fund Medicaid and then they help funnel that money back to hospitals to increase the amount they get paid for caring for Medicaid patients.
CHAKRABARTI: Understood. Okay. That makes a lot more sense. Are there also proposed change? I’m just catching up with this right now. Larry, so help me out here. Two work requirements that have come out of the Senate.
LEVITT: That’s right. Republicans are universally behind work requirements. The proposal in the House that the House passed for work requirements was quite stringent.
The Senate made it even more stringent particularly for parents and the House bill. All parents of dependent children were exempt from their work requirement in the Senate, only parents of kids up to age 14 would be exempt. So it’s similar but goes even further.
CHAKRABARTI: Okay. So more requirement, work requirements and deeper cuts from the Senate’s view on Medicaid. We’ve got about 30 seconds left, Larry. How might this, we don’t know what’s gonna happen, because these bills have to be resolved with each other, but how might this have an impact on the Americans who rely on Medicaid?
LEVITT: This is 80 million people are covered by Medicaid and these cuts, which would shift cost to state and make it harder for people to sign up for Medicaid would result, the Congressional Budget Office estimated 10.9 million more people would be uninsured as a result of the House bill.
That’s probably gonna be even higher as a result of the Senate proposal.
The first draft of this transcript was created by Descript, an AI transcription tool. An On Point producer then thoroughly reviewed, corrected, and reformatted the transcript before publication. The use of this AI tool creates the capacity to provide these transcripts.
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