Posted by Abc News · May 14, 2012 4:13 PM
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The Pentagon was inundated with so many studies in 2010 that it commissioned a study to determine how much it cost to produce all those studies.
Now the Government Accountability Office has reviewed the Pentagon’s study and concluded in a report this week that it’s a flop.
The study of a study of studies began in 2010 when Defense Secretary Robert Gates complained that his department was “awash in taskings for reports and studies.” He wanted to know how much they cost.
Two years later, the Pentagon review is still continuing, which prompted Congress to ask the GAO to look over the Pentagon’s shoulder. What they found lacked military precision.
The GAO found only nine studies that had been scrutinized by the Pentagon review, but the military was unable to “readily retrieve documentation” for six of the reports.
The Department of Defense’s “approach is not fully consistent with relevant cost estimating best practices and cost accounting standards,” the GAO concluded. In fact, they often did not include items like manpower, the report found.
The Pentagon “partially concurs” with the GAO’s report.
The cost of the study of the study of the studies was not available from the GAO.
Posted by Julian Pecquet · May 14, 2012 3:44 PM
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U.S. lawmakers have been unusually silent about federal regulators' decision to allow a Chinese bank to take over 13 bank branches in New York and California, suggesting that they think American banks have much to gain.
Members of both parties usually relish the chance to bash China on everything from government subsidies to the yuan's exchange rate. Yet Wednesday's decision by the Federal Reserve to certify a Chinese bank acquisition for the first time was met by near-universal silence.Scott Talbott, the head lobbyist for the Financial Services Roundtable, said that's unsurprising. The U.S. wants China to open up its financial services market – foreign ownership of Chinese banks is limited to 25 percent – and allowing a Chinese presence in the U.S. is seen as a necessary trade-off.
“What this boils down to is that there are a ton more potential customers in China for U.S. banks than there are potential customers for the Chinese here,” Talbott said. “So in the long run, the approval is going to benefit the U.S.”
Wednesday's decision allows Industrial & Commercial Bank of China, which is 70 percent owned by the Chinese government, to take an 80 percent stake in a Hong Kong-based bank with 13 branches in the U.S. The Fed also allowed two other Chinese banks to open branches in New York and Chicago.
The decision came days after Treasury Secretary Tim Geithner met with top Chinese officials for annual talks in Beijing. China agreed during those talks to allow foreigners a greater stake in Chinese brokerage firms.
Posted by The Blaze · May 09, 2012 6:09 PM
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The federal government is spending $4 million to help hook up farmers and low-income customers.Currently, fewer than a quarter of the nation’s roughly 7,100 farmers markets are set up to use the Electronic Benefit Transfer system, or food stamps. But Kathleen Merrigan, deputy secretary of agriculture, said she hopes these grants will bring another 4,000 of those outlets on line with the Supplemental Nutrition Assistance Program.
“SNAP participation at farmers’ markets helps provide fresh fruit and vegetables to families and expands the customer base for local farmers – a win-win for agriculture and local communities,” she said in a statement.
The money is to equip these locations with wireless “point of sale” equipment to be used with the food program’s debit cards. Grants range from $5,404 for Delaware, which has 11 markets, to $426,945 for California, with 687.
Kevin Concannon, the undersecretary for food, nutrition and consumer services, was touring sites around the country this week. On Tuesday, he stopped at the State Farmers Market in Raleigh, N.C.
“We’re on a mission to help Americans eat better,” Concannon said after sampling a vendor’s blueberries. “And what better place than to provide access, better access to folks for farmers markets. And in particular for low-income people.”
North Carolina will receive $109,631.
The Raleigh market has already funded its own wireless system. Still, only four vendors there accept the EBT, though three more are setting up to do so, said Ronnie Best, the market’s manager.
“We’ve been doing it three months and … we don’t even average fifteen sales a week on it right now,” said Helen Wise, owner of Wise Farms in nearby Mount Olive.
Concannon acknowledged that many of these markets are off the beaten path and can be hard – and expensive – for low-income people to access. But he said many are within easy reach of the estimate 46 million Americans who used food stamps.
“But in general, I’ve found that … once you provide access to low-income folks, they’ll come back,” he said. “They can price like the rest of us. … It’s one more step in trying to promote healthier eating for the country.”
Merrigan said SNAP expenditures at farmers markets have risen by 400 percent since 2008.
Betty Tart of Tart Farms said she, too, sees few food stamp customers at her stand. But she said those who do come by are delighted she can accommodate them.
“It makes me feel good,” she said as a large American flag waved overhead. “Because, I have family that has been in that situation. I haven’t, but I’m not too far gone. I could be one day.”
Posted by Wthr · May 03, 2012 7:58 PM
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Billions of dollars in tax credits are being paid out to illegal immigrants because of a certain “undocumented worker” tax loophole, Indiana’s WTHR-TVreports.And, of course, it’s all happening at the expense of the taxpayer.
“There is not a doubt in my mind there’s huge fraud taking place here,” a whistleblower told Eyewitness News on condition of anonymity, “We’re talking about a multi-billion dollar fraud scheme here that’s taking place and no one is talking about it.”
So how does the alleged fraud work? It’s a little convoluted but reporter Bob Segall walks you through the process:
The Internal Revenue Service says everyone who is employed in the United States – even those who are working here illegally – must report income and pay taxes. Of course, undocumented workers are not supposed to have a social security number. So for them to pay taxes, the IRS created what’s called an ITIN, an individual taxpayer identification number. A 9-digit ITIN number issued by the IRS provides both resident and nonresident aliens with a unique identification number that allows them to file tax returns.
Each spring, at tax preparation offices all across the nation, many illegal immigrants are now eagerly filing tax returns to take advantage of a tax loophole, using their ITIN numbers to get huge refunds from the IRS.
The loophole is called the Additional Child Tax Credit. It’s a fully-refundable credit of up to $1000 per child, and it’s meant to help working families who have children living at home.
And this is where the scheme kicks in: many illegal immigrant use the tax credit to claim children living in Mexico as dependents.
“We’ve seen sometimes 10 or 12 dependents, most times nieces and nephews, on these tax forms,” the whistleblower told Eyewitness News. “The more you put on there, the more you get back.”
According to Eyewitness, the whistleblower was able to provide proof of the scheme. For instance, he produced a return that shows a $10,3000 refund paid out to an “undocumented worker” who claimed nine nieces and nephews. Another return showed an $11,000 refund made to another “undocumented worker” who claimed seven nieces and nephews.
“I can bring out stacks and stacks. It‘s just so easy it’s ridiculous,” the anonymous source said.
A report released by George’s office shows the problem costs taxpayers more than $4.2 billion each year.
“Keep in mind, we’re talking $4 billion per year,” George said. “It’s very troubling.”
Apparently, the IRS has known about the scheme for years and it has done nothing about it despite repeated warnings from the inspector general’s office.
“Millions of people are seeking this tax credit who, we believe, are not entitled to it,” said the inspector general. “We have made recommendations to [IRS] as to how they could address this, and they have not taken sufficient action in our view to solve the problem.”
This is what the IRS had to say for itself in an official statement sent to WTHR:
The law has been clear for over a decade that eligibility for these credits does not depend on work authorization status or the type of taxpayer identification number used. Any suggestion that the IRS shouldn’t be paying out these credits under current law to ITIN holders is simply incorrect. The IRS administers the law impartially and applies it as it is written. If the law were changed, the IRS would change its programs accordingly.
The IRS disagrees with TIGTA’s recommendation on requiring additional documentation to verify child credit claims. As TIGTA acknowledges in this report, the IRS does not currently have the legal authority to verify and disallow the Child Tax Credit and the Additional Child Tax Credit during return processing simply because of the lack of documentation.
The IRS has procedures in place specifically for the evaluation of questionable credit claims early in the processing stream and prior to issuance of a refund. The IRS continues to work to refine and improve our processes.
Posted by Giles Broom · May 02, 2012 10:11 AM
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Rich Americans renouncing U.S. citizenship rose sevenfold since UBS AG (UBSN) whistle-blower Bradley Birkenfeld triggered a crackdown on tax evasion four years ago.
About 1,780 expatriates gave up their nationality at U.S. embassies last year, up from 235 in 2008, according to Andy Sundberg, secretary of Geneva's Overseas American Academy, citing figures from the government's Federal Register. The embassy in Bern, the Swiss capital, redeployed staff to clear a backlog as Americans queued to relinquish their passports.
The U.S., the only nation in the Organization for Economic Cooperation and Development that taxes citizens wherever they reside, is searching for tax cheats in offshore centers, including Switzerland, as the government tries to curb the budget deficit. Shunned by Swiss and German banks and facing tougher asset-disclosure rules under the Foreign Account Tax Compliance Act, more of the estimated 6 million Americans living overseas are weighing the cost of holding a U.S. passport.
"It started with the fallout from UBS and non-U.S. banks feeling it's too risky to deal with Americans abroad," said Matthew Ledvina, a U.S. tax lawyer at Anaford AG in Zurich. "It will increase because Fatca will require banks to track down people, some of whom will make voluntary disclosures before renouncing their citizenship."
Renunciations are higher in Switzerland because American expatriates expect extra scrutiny of their affairs after the UBS case and as the U.S. probes 11 other Swiss financial firms for aiding offshore tax evasion, said Martin Naville, head of the Swiss-American Chamber of Commerce in Zurich.
Absurd Tax Laws"Most of the real cross-border tax troubles have been around Switzerland," Naville said. "We've got absurd tax laws coming into force because of the activities of certain people who tried to hide money."
During a 10-minute renunciation ceremony in a booth with bullet-proof glass windows, embassy staff ask exiting Americans whether they are acting voluntarily and understand the implications of giving up their passports. They pay a fee of $450 to renounce and may incur an "exit tax" on unrealized capital gains if their assets exceed $2 million or their average annual U.S. tax bill is more than $151,000 during the past five years.
They receive a certificate within three months, telling them they are no longer American citizens and entitled to the services and protection of the U.S. government.
Taxman ComethThe U.S. embassy in Bern declined to comment on renunciations. The U.S. State Department doesn't disclose annual figures, said Elizabeth Finan a spokeswoman for the Washington- based department, adding that "on average" 1,100 people give up their citizenship each year.
While the U.S. taxes citizens regardless of where they reside, overseas income of as much as $95,100 is exempt and credits help compensate for foreign taxes paid. Americans living in Switzerland can't take advantage of the absence of a capital gains tax in the Alpine country or tax deductions allowed on pension contributions.
"Every dollar you save, you lose to the U.S. tax man," said tax lawyer Ledvina. "That's one reason why people give up citizenship."
Americans, who disclose their non-U.S. bank accounts to the IRS, must file the more expansive 8938 form beginning this year that asks for all foreign financial assets, including insurance contracts, loans and shareholdings in non-UNN.S. companies.
Imperial OverreachThe 2010 Fatca law requires banks to withhold 30 percent from "certain U.S.-connected payments" to some accounts of American clients who don't disclose enough information to the IRS.
"There is incredible frustration at the audacity and imperial overreach of this law," said David Kuenzi, a tax adviser at Thun Financial Advisors in Madison, Wisconsin, referring to Fatca.
Failure to file the 8938 form can result in a fine of as much as $50,000. Clients can also be penalized half the amount in an undeclared foreign bank account under the Banks Secrecy Act of 1970.
"It's a big brother concept," said Brent Lipschultz, a partner at New York-based accounting firm EisnerAmper.
The implementation of Fatca from next year comes after UBS, Switzerland's largest bank, paid a $780 million penalty in 2009 and handed over data on about 4,700 accounts to settle a tax- evasion dispute with the U.S. Whistle-blower Birkenfeld was sentenced to 40 months in a U.S. prison in 2009 after informing the government and Senate about his American clients at the Geneva branch of Zurich-based UBS.
Voluntary DisclosuresThe UBS settlement led to about 33,000 voluntary disclosures to the IRS in the three years through 2011 and the repatriation of billions of dollars to the U.S. Swiss banks saw their offshore North American assets shrink by about 60 percent to 60 billion Swiss francs ($66 billion) in 2010 from three years earlier, according to Boston Consulting Group.
American Citizens Abroad, a Geneva-based organization that campaigns for taxation based on residency, said the government doesn't always distinguish between U.S.-based tax dodgers with offshore accounts and expatriates that need foreign banking services.
"The perception is that any American living overseas is there for a nefarious reason," said Marylouise Serrato, executive director of the organization that has members in 90 countries. "There isn't a deep understanding in the U.S. of why American citizens would move overseas."
Civil War HangoverTaxing Americans resident overseas is a "hangover from the Civil War" and the introduction of federal income tax in 1861, according to Jackie Bugnion of American Citizens Abroad. The rules make it harder for Americans to hold foreign bank accounts and gain access to mortgages, she said.
German lenders Deutsche Bank AG and HVB Group terminated the securities accounts of some U.S. citizens following the announcement of stricter reporting requirements. Swiss Raiffeisen Group, Switzerland's third-biggest banking network, decided at the end of last year to sever ties with U.S.- domiciled clients and refuse new applications from any American, said Philippe Thevoz, a spokesman for the St.Gallen, Switzerland-based firm.
The additional compliance costs for companies to ensure that Americans they hire are filing the correct U.S. tax returns and asset-declaration forms are at least $5,000 per person, said Ledvina. Where individuals are getting their returns prepared, the expense may amount to $1,500 to $2,000, which is pushing expatriates to consider giving up citizenship.
"The compliance costs are high and they're getting worse," Ledvina said. "It's hard to serve two authorities and the problem for Americans abroad is that the IRS doesn't care."
Posted by Kelly Evans - Cnbc · April 26, 2012 10:02 AM
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Here’s what we do know about student loan debt: it’s roughly $1 trillion in size, greater than either auto or credit-card debt and second only to mortgage debt in the U.S. Borrowers in their 30s today owe $28,500, on average. The debt burden has soared just as — and partly because — the recession hit, so younger graduates carrying the highest balances are hit with the double whammy of a weak job market(that still isn’t showing any sign of rapid improvement).
And this all comes as globalization and technological change have upended once-reliable career paths, wiped out many mid-level professional jobs and leave low-paying fields in health, food and beverage services, and retail as among the fastest growing job markets over the next decade.
Oh, and consider that student loan debt remains one of the most difficult types to forgive or discharge in bankruptcy, in part because the federal government (i.e. taxpayers) made or guaranteed 80 percent of all outstanding student loan debt as of last year. And finally, that once loans in deferral or forbearance are excluded, the delinquency rate on student loan debt was an estimated 27 percent as of the third quarter of 2011, according to a study by the New York Fed.Worried? Americans should be.
Still, acknowledging the problem is perhaps the easiest step. Much more difficult is the question of what to do about it. Not surprisingly, young, heavily indebted grads are calling for forgiveness in full or in part of their student loan burdens. Petitions on advocacy website Change.org include calls for federal student loan interest rates to be capped at 3 percent or eliminated altogether. (Indeed, President Obama is currently among those urging Congress not to allow the interest rate on federally subsidized Stafford loans, which are aimed at low — and middle-class borrowers, to double to 6.8 percent on July 1, matching the rate for unsubsidized loans.)
And yet the trouble with those initiatives, or with forgiving student loan debt in whole or part, is threefold. For starters, the straight mathematics: the losses from any such debt reduction scheme will have to be borne by someone, most likely taxpayers, at a time when government finances are already stretched.
Second is the issue of “moral hazard,” that is, rewarding and implicitly encouraging imprudent behavior rather than punishing it. (Of course, it is easier for the public at large to demand that over-leveraged banks be punished for imprudence than 24-year-olds trying to further their education.)And third is the question of how to keep future graduates from accumulating a mountain of student loan debt just as large, if not larger, than the one just leveled.
It is this third issue which perhaps is most pressing — and most vexing —and which also offers the most opportunity for innovation. Levying an “education tax,” making college free and assigning students to institutions based on a lottery system? Abolishing “college” altogether for more specialized trade institutions instead, while at the same time requiring a “gap year” of liberal arts prior to entry? Offering high-school grads the choice between student loans or business loans to fund new ventures? These all seem ridiculous, but then so too is our current state of affairs.Our current system, in fact, has so failed that it may now be exacerbating income inequality (by saddling low-income students with high loan balances and shaky job prospects), economic malaise (by keeping would-be homebuyers stuck in costly rentals because of already high debt loans and/or poor credit histories, thereby damaging both the housing market and potential consumer spending), and long-term economic vitality (by hampering household and family unit formations with a higher share of 20- and 30-somethings currently stuck at home with mom and dad).
This, in fact, is why it may be far less costly for taxpayers in the long run to forgive as much of the current student-loan burden as possible. Before doing anything like that, however, there must be systematic reform to ensure debt loads simply won’t start to pile up again. (Not to mention the need for repercussions for those borrowers who most benefit from any such initiative, for the sake of fairness.) That is why the need for innovation or overhaul is so pressing.
One thing is certain: if we do nothing to alter the status quo, we will have no one to blame but ourselves for the bleak outcome.
Posted by Robert Pear · April 23, 2012 4:54 PM
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Medicare is wastingmore than $8 billion on an experimental program that rewards providers of mediocre health care and is unlikely to produce useful results, federal investigators say in a new report.The report, to be issued Monday by the Government Accountability Office, a nonpartisan investigative arm of Congress, urges the Obama administration to cancel the program, which pays bonuses to health insurance companies caring for millions of Medicare beneficiaries.
Administration officials, however, defended the project and said they would not cancel it because it could improve the quality of care for older Americans.
In the 2010 health care law, Congress cut Medicare payments to managed care plans, known as Medicare Advantage, and authorized bonus payments to those that provide high-quality care. Investigators found that most of the money paid under the demonstration program went to “average-performing plans” rated lower than the benchmarks set by Congress.
The report said the project would cost $8.3 billion over 10 years, with 80 percent of the cost occurring in the first three years.
Federal investigators are trying to determine whether Medicare officials had the legal authority to make the changes.
Senator Orrin G. Hatch of Utah, the senior Republican on the Finance Committee, and Representative Dave Camp, Republican of Michigan and chairman of the Ways and Means Committee, said the report suggested that Medicare officials had abused their authority.
In a statement, Mr. Hatch and Mr. Camp said they were concerned that the government might be “using taxpayer dollars for political purposes, to mask the impact on beneficiaries of cuts in the Medicare Advantage program.” Administration officials denied that.
A separate federal panel, the independent Medicare Payment Advisory Commission, also criticized the project, saying it increases “spending at a time when Medicare already faces serious problems with cost control and long-term financing.”
The panel denounced Medicare’s “overly broad use of demonstration authority” and said “limited Medicare dollars should go to truly high-performing plans.” It said “the extension of quality bonuses to the vast majority of plans is likely to result in far greater program costs than the reward system enacted” by Congress, and that by spreading the rewards so broadly, “the demonstration lessens the incentive to achieve the highest level of performance.”
The G.A.O. said the project “dwarfs all other Medicare demonstrations” in its impact on the budget, but is so poorly designed that researchers could not tell whether the bonus payments led to improved care. As a result, it said, it is unlikely to “produce meaningful results.” Insurers can use the bonuses to offer extra benefits, like vision and dental care, or to lower premiums.
More than 12 million people are in Medicare Advantage plans. About one-third of them are in plans that would receive bonuses under the 2010 law. By contrast, under the demonstration program, 90 percent are in plans eligible for bonuses, the report said.
The administration said that by offering bigger bonuses to more health plans, it hoped to encourage larger, more rapid improvements in care. “All Medicare Advantage plans will be part of the demonstration,” a federal health official told James C. Cosgrove, the accountability office’s director of health care studies.
The Medicare commission said “demonstration authority is intended for smaller-scale projects” that test innovations in the way health care is financed and delivered.
The health care law cut payments to private Medicare Advantage plans after many studies found that they were being overpaid. President Obama said the private plans were getting “unwarranted subsidies” that “pad their profits but don’t improve the care of seniors.”
The commission said payments to private plans, including the bonuses, were still about 7 percent higher than what the government would pay for similar beneficiaries in the traditional Medicare program.
Posted by Deroy Murdock · April 22, 2012 5:22 PM
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A pril 29 will mark three years since Senate Democrats passed a budget. This dereliction of duty lagrantly violates the 1974 Congressional Budget and Impoundment Control Act.
“On or before April 15 of each year, the Congress shall complete action on a concurrent resolution on the budget for the fiscal year,” this statute states. Senate Democrats could not care less about this federal law.
This is a milestone in human sloth. While it has taken Majority “Leader” Harry Reid of Nevada and Senate Democrats 36 months to conceive zero budgets, House Republicans have delivered two - one for each year they governed.
Nonetheless, Mr. Reid said on Feb. 3: “We do not need to bring a budget to the floor this year. It’s done. We don’t need to do it.”
“This is the wrong time to vote on the floor,” Senate Budget Chairman Kent Conrad, North Dakota Democrat, declared Tuesday. “I don’t think we will be prepared to vote before the election.”
Floor votes would require Senate Democrats to borrow and spend, which annoys taxpayers, or cut outlays, which aggravates liberal lobbyists and porcine government-employee unions. So, Senate Democrats break the law and demand continuing resolutions, which spend on autopilot.
Meanwhile, consider what focused, energetic humans have completed in less time than Senate Democrats have consumed to accomplish nothing on the budget.
c Broad Group, a Chinese construction company, erected the 30-story Ark Hotel in just 15 days late last year. Laboring around the clock, employees in Changsha used prefabricated modules to build an energy-efficient structure that reportedly could withstand a magnitude 9 earthquake. According to London’s Daily Mail, no worker was injured on this project. Watch Gizmodo.com’s stunning time-lapse video of this effort.
c Producer David O. Selznick and director Victor Fleming took nine months and 16 days (Jan. 26 to Nov. 11, 1939) to shoot, edit and release “Gone With the Wind.” This beloved Civil War epic features a huge cast, massive sets, lavish costumes and landmark performances, all of which made it a box-office smash. It eventually scored a then-record 10 Academy Awards.
c Led by Supreme Commander Dwight D. Eisenhower, Allied Forces landed on Normandy Beach, France, on June 6, 1944, and bravely battled Nazi Germany until Victory in Europe Day on May 8, 1945. American and Allied GIs needed 11 months and two days to liberate Europe.
c Creating the Empire State Building required one year, three months and nine days. Between Jan. 22, 1930 and May 1, 1931, about 3,400 workers built what was the world’s tallest skyscraper for 42 years, rising 1,454 feet above the sidewalks of New York. (The late, great World Trade Center won that distinction in 1973.) As documentarian Ric Burns noted, the building’s steel beams were forged in Pittsburgh and whisked to the site via trains, barges and trucks. As they were riveted into place, they still were warm.
c The Pentagon’s construction began on Sept. 11, 1941, and ended one year, four months and two days later, on Jan. 15, 1943. Col. Leslie Groves, who later spearheaded the assembly of the atomic bombs that ended World War II, led the installation of this 6.5-million-square-foot office building, still Earth’s vastest. Oddly enough, the Sept. 11 hijackers crashed into the Pentagon on the 60th anniversary of its groundbreaking, killing 189 people.
c According to the latest Department of Education data, 656,784 students earned MBAs and other master’s degrees in 2008-09. Most secured those credentials within two academic years.
c In the War of 1812, American GIs spent two years, six months and six days (June 18, 1812 to Dec. 24, 1814) persuading revanchist British soldiers that we weren’t kidding when we declared independence on July 4, 1776.
These triumphs of human action are both private and public. Even government sometimes can finish what it starts, assuming leadership, industriousness and responsibility. Too bad these virtues are AWOL in today’s Democratic Senate.
Posted by Damian Paletta · April 20, 2012 11:15 AM
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The Congressional Budget Office said Thursday that 45 million people in 2011 received Supplemental Nutrition Assistance Program benefits, a 70% increase from 2007. It said the number of people receiving the benefits, commonly known as food stamps, would continue growing until 2014.
Spending for the program, not including administrative costs, rose to $72 billion in 2011, up from $30 billion four years earlier. The CBO projected that one in seven U.S. residents received food stamps last year.
In a report, the CBO said roughly two-thirds of jump in spending was tied to an increase in the number of people participating in the program, which provides access to food for the poor, elderly, and disabled. It said another 20% “of the growth in spending can be attributed to temporarily higher benefit amounts enacted in the” 2009 stimulus law.
CBO said the number of people receiving benefits is expected to fall after 2014 because the economy will be improving.
“Nevertheless, the number of people receiving SNAP benefits will remain high by historical standards,” the agency said.
It estimated that 34 million people, or 1 in 10 U.S. residents, would receive SNAP benefits in 2022 “and SNAP expenditures, at about $73 billion, will be among the highest of all non-health-related federal support programs for low-income households.”