With the new presidency coming in there are some concerns about the management of benefits, specifically the Supplemental Nutrition Assistance Program (SNAP), as some comments have been made indicating that the program may be under peril once president elect Trump takes office.
Vivek Ramaswamy founder of Roivant Sciences, a pharmaceutical company and former Republican candidate, along with billionaire Tesla and Space X owner Elon Musk, are set to head up a new advisory body, the Department for Government Efficiency, or DOGE in the new year which, according to them will eliminate waste in multiple government programs and agencies to “improve efficiency”. One of the targeted programs is SNAP, which is funded by the U.S. Department of Agriculture and run at state level.
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According to data from Ramaswamy, SNAP, which caters low- and no-income families across the U.S. to help them pay for essential groceries, has $1 billion “wasted *every month* on ineligible SNAP benefits” due to overpayments and fraudsters preying on beneficiaries. Reported by Newsweek, he continued to explain that “Overpayments occur when states allow recipients to continue receiving benefits despite incomes that should disqualify them. Other times, fraudsters collect benefits from multiple states due to lack of coordination. Eliminating waste & fraud in SNAP would save billions annually. This isn’t (or at least shouldn’t be) a partisan point.”
The problems with SNAP Benefits
The data provided was not accurately cited, so we do not know the source, but the reality is that the program has been subject to widespread fraud in recent years, with many problems occurring with the electronic benefit transfer (EBT) cards specifically.
These EBT cards are loaded with money every month to use in participating stores and online, and, since they work as regular debit or credit cards, they are subject to scams such as cloning, phishing or skimming, all issues that occur with bank cards as well.
Since Q2 2023, over 810,000 fraud cases have been reported to the USDA, with $150,646,972 in stolen benefits replaced. The national overpayment rate for fiscal year 2023 was 10.03%, while underpayments stood at 1.64%. These rates vary widely by state, with Alaska experiencing the highest error rate at 60.37% and South Dakota the lowest at 3.27%.
Since this problem has been going on for a while, there have been many demands by officials at SNAP, as well as concerned citizens and local politicians to implement “urgent state actions” to fix the problem. Higher penalties for those who commit the fraud have also been suggested, but as it is a state run program, even if the funds are federal, penalties vary widely from state to state.
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And not all problems are due to fraud, as the government agency said in June 2024 in a press release “Payment errors are largely due to unintentional mistakes, either by the state agency or the household, that affect the accurate determination of eligibility or benefit amounts.”
And although penalties will be administered for non-compliance, little can be done as a result of mistakes to declare them fraud.
Other DOGE purposes
The new advisory cabinet will not just focus on SNAP benefits, but it will attempt to overhaul the fraud prevention measures for other types of government assistance like Social Security and Medicare, which are not known for their fraudulent claims, but the new members seem to find them wasteful nonetheless.
The good news is that, according to Ramaswamy large widespread cuts are unlikely as it is “a policy decision that belongs to the voters” and their representatives in Congress. This means that Americans may get a short reprieve before these programs are deemed completely inefficient by business standards and are cut.