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Home Publications Blogs Beat the Press Did You Know That Food Stamps Was a $760 Billion Program?

Did You Know That Food Stamps Was a $760 Billion Program?

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Tuesday, 18 June 2013 05:09

I sure didn't, which is why I was surprised to see an NYT article refer to it as "the $760 billion program." This number is referring to the cost of the program over a 10-year budget window, which careful readers may have gleaned from the rest of the sentence which tells us that fraud accounts for 1 percent of the program's cost or $760 million a year. Nowhere does the piece directly say that the $760 billion figure refers to a ten year spending number and not a one year number.

This is a great example of the absurdity of budget reporting. It is highly unlikely that most NYT readers assume that budget numbers are for a ten year horizon. While this is a standard in budget wonk circles, it is hardly a normal practice anywhere else. Giving a spending figure without even explicitly telling readers the number of years it covers is not providing information. This should not have gotten by an editor.

It would have been simple to write this in a way that would convey information. The government is projected to spend a bit over $50 trillion in the next decade. If the piece had described projected spending on the food stamp program as a bit more than 1.5 percent of projected spending then most readers would have a reasonable idea of the importance of the program in the budget and to their tax obligations. If it makes people feel better it could also include the dollar figure, but since almost no one knows the size of the projected budget (especially over a ten year horizon), the percent number would provide far more information.

There is no excuse for using numbers that don't convey information when it is so simple to use an alternative that would be easily understood by the vast majority of readers.

 

Note:

The NYT has a corrected the piece so that it no longer refers to food stamps as a $760 billion program. It would be nice if they described it as a percentage of the budget so as to actually convey some information to their readers.

Comments (20)Add Comment
Are NYT readers good at percentages?
written by Robert Salzberg, June 18, 2013 6:08
I'm guessing that at least a double digit percent of NYT readers will think that 760 million is 1% of 760 billion.

Which would then lead them to believe a 10 year figure is a 1 year figure.

So how many NYT readers now believe food stamps are a 760 billion a year program and that Fox and Friends are right for screaming that it should be cut down?
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written by Mark Jamison, June 18, 2013 6:15
O.k., I know we favor arithmetic on this site so I'm surprised this wasn't mentioned. The cost of a $760 million per year program would be $7.6 billion over ten years or are we extending things out 100 years. Nearly a trillion dollars can sound pretty scary but less so over a century.
Or am I missing something in the math or reading comprehension?
And to answer my own question it appears I am. It takes a few times to read the sentence and get some clarity but we're talking about a $76 billion per year program that has a 1% fraud rate which amounts to $76 million per year or $760 million over the ten year life.
So the way it reads nearly a trillion dollars worth of fraud sounds really scary but while $76 million is a big number, 1% seems like a reasonable fraud rate.
Why doesn't the NYT simply amend every headline with the tag: Big Numbers are Really Scary!
Mark Jamison bolsters my point and Dr. Dean Baker's main point, math is a lost art
written by Robert Salzberg, June 18, 2013 6:54
Yo Mark J. One billion is a thousand million not a hundred million. A million is 0.1% of a billion, not 1% of a billion. 1% of the 76 billion per year cost of the SNAP program is 760 million, not 76 million.

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written by Kat, June 18, 2013 7:15
Further confusing the issue: The rate of food stamp fraud, on the other hand, has declined sharply in recent years, federal data shows, and now accounts for 1 percent of the $760 billion program, or $760 million a year.

OK, I see others have raised the same point. Great reporting!

Also, the 9 billion crop insurance program is this the 10 year cost?
9 billion is per year cost for crop insurance
written by Robert Salzberg, June 18, 2013 7:43
"Currently, the federal government chips around $7 billion per year to help farmers cover the crop insurance premiums. Under the Senate farm bill, the government would expand this subsidy with an additional $5 billion per year to cover the deductibles that farm owners pay before their insurance kicks in."

http://blog.heartland.org/2013/06/crop-insurance-expanded-in-senate-farm-bill/
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written by dick c, June 18, 2013 7:45
What are the chances we'll ever see an article referring to our $8,000,000,000,000.00 defense programs?
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written by Last Mover, June 18, 2013 8:12

Why is this a problem? So the food stamp program is now as important as the defense program in terms of spending.

Thank god the country has come around to accept the patriotic principle of eating to live rather than living to eat.
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written by Kat, June 18, 2013 8:19
Thanks for the information,Robert.
It figures.
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written by Mark Jamison, June 18, 2013 8:40
Well I guess arithmetic is hard - what can I say Salzburg is right. Moral - wake up before commenting though I'm still not sure that NYT shouldn't append Big Numbers are Really Scary to some of these articles and the original point that Dr. Baker makes is right - the article is far from clear.
Gave myself a minus on this one.
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written by Ben Zipperer, June 18, 2013 9:03
I find it especially ironic that the article's headline is "Fraud Used to Frame Farm Bill Debate."
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written by skeptonomist, June 18, 2013 9:18
Well, the piece says "The rate of food stamp fraud...now accounts for 1 percent of the $760 billion program, or $760 million a year". If you assume that this weird sentence is not a mistake, you can work backwards and determine that the $760B must apply to ten years.

The $9B figure which is given for crop insurance, is apparently for one year. The piece goes on to discuss fraud and error rates in that program, but never gives an actual figure which could be compared directly to the $760M fraud cost for food stamps, although this comparison is the main subject of the piece.
Assuming informing the public was the point
written by Ryan, June 18, 2013 9:46
I'm a little surprised you didn't call this editorializing. Misleading numbers, devoid of context. This is very effective at scaring people toward action against a perceived threat. It is not, however, useful from an educational or informational standpoint.
the ny times, wa post & wsj
written by mel in oregon, June 18, 2013 10:28
Years ago, quite a while before the internet, I enrolled at a southern religious school mostly just to get another perspective than my Oregon upbringing. All the important professors had their PHD, & they all read the afore mentioned papers. They were all liberals supporting the newly emerging civil rights marches & they all thought Pres. Kennedy was too conservative. It was quite a contrast to the student body & towns people who were overwhelmingly very conservative, racist & very uninformed. It was also the end of my religious beliefs, & led me over the next 20 years to read about 500 books about evolution. The Ny Times & Wa Post are much less factual & much more propaganda today than they were then. But then all corporate papers today are all propaganda machines. So is television, it is just one big machine designed to get people to buy crud produced overseas that they don't need. If you must read these rags, do so for comic relief relief, you won't be dissapointed.
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written by watermelonpunch, June 18, 2013 11:43
Apparently they fixed it?
The rate of food stamp fraud, on the other hand, has declined sharply in recent years, federal data shows, and now accounts for .01 percent of the $75 billion program, or about $750 million a year.


What bugs me about the whole thing is that when ordinary people think of this program, they ONLY think about food stamps. Most ordinary people don't know much about farm subsidies at all.
And this idea that there are just huge masses of people fraudulently getting food stamps is rampant among ordinary people... whereas the known fraud cases in the farm subsidies never seem to be on the minds of ordinary people.

Clearly reporters are not doing their jobs very well in general to report things at all.
And then when they do, they throw numbers willy-nilly into it for effect of grandeur... numbers that are truly meaningless to most people who deal in 10s or 100s of dollars, not billions or millions, or even thousands.

It's like asking someone who commutes to work 15 miles a day, to start thinking in terms of millions of light years distances between galaxies. Most people can't grasp the size of the solar system, never mind.
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written by mark in oregon, June 18, 2013 11:44
Fraud is only one per cent? That is an astoundingly low number. Food stamp programs are amazingly honest. IIRC, retail stores, grocery stores, bars, and restaurants lose close to ten per cent to shop-lifting and special favors by their employees to their friends.
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written by JDM, June 18, 2013 12:17
You know, for some reason when I ask an insurance company for a quote for my car, they always say something like "it'll be $800" and they mean a year. They never seem to say "it'll be $8 grand". Maybe if they were owned by the NYT or another newspaper, TV, or radio news outlet.
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written by Joe C, June 18, 2013 1:12
Looks like they read Dean's column. Appears they have corrected it.
Crop insurance supposedly inflated by food stamps: true?
written by squeezed turnip, June 18, 2013 3:07
Robert Salzburg, I've not time today to track down Senator Cruz's complaint against that farm subsidy bill, but here is a link http://blog.chron.com/txpotoma...for-texas/, where Cruz says (amongst other things)
This farm bill costs 60 percent more than the 2008 bill. Nearly 80 percent of it consists of a massive expansion in food stamps, trapping millions in long-term dependency.
.
Cruz is a master debater, so who knows if the word "it" refers to the increase or to the entire bill, but either way I wouldn't doubt he's got his figures wrong. Anybody fluent on this one?
Ten Year Budgeting is grossly unrealistic
written by Wisdom Seeker, June 18, 2013 11:45
The whole idea of counting the budget over 10 years is horsefeathers. None of the forecasting/planning agencies (CBO etc) have made accurate 10-year predictions. Rumor has it that the current 10-year scenarios don't include a single recession, despite the fact that historically that's never happened. Furthermore, Congress can't even pass a budget before the start of a fiscal year, and has far more urgent budget-changing crises crop up far more frequently than every 10 years, so a 10-year horizon for planning is grossly unrealistic.
no recession in assumptions
written by Dean, June 19, 2013 12:57
That's correct wisdom seeker -- they never assume recessions, although they do try to average in the impact of a recession on the budget in their 10-year horizon. That means, if they get it right, they may be off on say 2020 GDP and revenue, but they get the totals for 2013-2023 right. The track record has not been great.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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