Feature

The Shutdown Is Holding Back Farmers From Spring Planting

In Asheville, North Carolina, vegetable farmers Becca Nestler and Steven Beltram are stuck between the impending spring season and the trickle-down effects of the government shutdown. Last week, when I spoke with Nestler — my friend since college — I asked about the farm. “We’re just stuck,” she told me. “We can’t even talk to our loan officer.”

The longest government shutdown in history has rendered many federal agricultural services unavailable, including the thousands of Farm Service Agency (FSA) offices that assist farmers with dozens of programs, such as disaster relief and annual farm operating loans. This is the time of year when Nestler and Beltram should be working with their FSA officer to prepare their annual loan packet — but with the office closed and their officer furloughed (and prohibited from using work cell phones or email to respond to farmers), they’ve had no choice but to wait.

“Usually by now we’re far enough down the road that we know the loan is going to get processed,” said Beltram. “But right now, we don’t have those assurances, because we haven’t been able to communicate with [the FSA].” With spring just around the corner, every week counts. Last year, they applied for their loan on Jan. 1 and received their funds five weeks later, on Feb. 6.

Last week, some FSA offices re-opened for a three-day period to work solely on existing loans and 1099 tax form preparation for borrowers, as those forms are due on Jan. 31. Secretary of Agriculture Sonny Perdue also announced that FSA offices would reopen on Jan. 24 for two weeks, and would offer “a longer list of transactions” for farmers, including operating loans. At the end of two weeks, if the government has still not reopened, FSA offices will move to a three-day work week schedule. All FSA employees will work without pay until the government re-opens.

Even with these measures, and even if the government does re-open soon, the damage has already been done. “I mean, if I’m reading the tea leaves, the best case scenario is they’re going to show up on the 24th with a huge backlog of stuff to do … and we’re not going to get our loan near on time,” said Beltram.

In fiscal year 2018, the USDA loaned a total of $5.4 billion, which helped farmers buy property, equipment, and necessary inputs, such as seeds and fertilizer — all of which are vital to farm operations and also prop up small rural economies.

Take tomatoes. At the beginning of February, Beltram and Nestler order seedlings from a local greenhouse, which requires a 50 percent deposit. By mid-March, they’ll begin fertilizing and prepping their fields, and seedlings will be transplanted in mid-May. They’ll spend money on inputs — fertilizer, irrigation and field supplies, fuel for their vehicles, shipping boxes, and labor — for tomato plants that won’t mature to generate revenue until mid-August. That’s at least six months without cash from sales.

“So every spring, we go to our lender, which is the FSA, and they loan us operating funds to put our crop in the ground,” said Beltram. “It’s the way farming has always been. … If you weren’t working with the bank 100 years ago, you were going to the general store and buying everything on credit until your crops came in.”

Factoring in costs for their entire 60-acre farm (which also includes organic leafy greens), Beltram estimates they’ll need $200,000 just in establishment costs, before they even think about harvest.

As they purchase their supplies and pay their employees, those funds naturally ripple out to others in the community. But the shutdown has brought this seasonal farm economy to a halt, freezing out farm families and small businesses already on the brink.

I don’t know any farmers in this area that have money sitting around right now.
– Steven Beltram

The shutdown situation also exacerbates a rough few years in farm country. In November, the USDA projected that net farm income would decline by $10.8 billion (14.1 percent) in 2018 — just 3.3 percent above the 2016 level, which was the lowest since 2002. As a result, the United States is losing farms in an eerie echo of the 1980s farm crisis, an economic disaster that upended rural America. In Wisconsin alone, 638 dairy farms closed up shop in 2018. Adding to the problems, President Donald Trump’s trade war made pawns out of commodity farmers, resulting in retaliatory tariffs that had sweeping and disastrous effects.

“Had [President Trump] set out to ruin America’s small farmers, he could hardly have come up with a more effective, potentially ruinous one-two combination punch than tariffs and the shutdown,” wrote Iowa radio news director Robert Leonard in a New York Times op-ed.

Climate change brought extreme weather to farm country as well. In North Carolina, Hurricane Florence was estimated to cost farmers more than $1 billion in damage and loss. And over the course of the season, Nestler and Beltram received more than 100 inches of rain (Asheville’s annual average is 45 inches), which caused massive flooding and wiped out 30 percent of their entire crop.

“It was the worst year we’ve ever had at the farm, financially,” said Beltram. “I don’t know any farmers in this area that have money sitting around right now. Everybody I know either broke even or lost money this year.” And then came the shutdown: He knows farmers who can’t pay their rent, buy groceries, or pay for day care because of the effect the government’s closure has had on their finances.

Beltram and Nestler plan to head to the FSA office as soon as it re-opens, but don’t expect to get their loan funds until mid-March, at best. In the meantime, they’ll go to the bank to apply for a bridge loan, and are considering the possibility of cash advances from credit cards until their FSA loan can be processed.

“I’ve been farming long enough that I can’t sweat things too much. I just have to have faith that it’s all going to work out,” Beltram said. “But there’s no question that our livelihood is seriously threatened by what’s going on.”

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First Person

D.C.’s High Housing Costs Pushed Me In and Out of Homelessness for 30 Years

Everyone always forgets about apartment building laundry rooms. That’s where I used to go when the temperature dipped below freezing — the doors are unlocked and they’re usually in the basement, far away from residents who might be tempted to call the cops to report us. If anyone knew to check, they could find as many as 20 people in a single building, huddling there away from the cold.

That’s why, when volunteers conduct the annual Point-In-Time Count by canvassing cities to count the number of people experiencing homelessness, I tell my partners to start in the laundry rooms. The count is always scheduled for the last 10 days in January, one of the coldest times of the year. Our hope is that the weather drives people off the streets and into the shelters, where it’s easier to get an accurate count. Then volunteers fan across the city in an attempt to count the remaining people who are still spending the night outside.

In a city as unaffordable as Washington, D.C., it’s not hard to find yourself included among the thousands of people experiencing homelessness during the Point-in-Time Count. I know, because I’ve been on both sides of it: For three years I have helped count people, because for nearly 30 years before that I was one of them. I’ve lived in this city my entire life, and I’ve watched it change drastically. In 1980, I got my first apartment – a studio near 9th and Kennedy – and my minimum wage job was enough to cover the $200 a month rent. Now, average rent for a studio in D.C. is $1,642. I could work those same jobs and still land in a shelter at the end of the night. The margin of error has been completely erased.

For decades, that margin was my most consistent home. I jumped from job to job, unable to stay anywhere long-term. I was enthusiastic about the work one minute, and the next I’d find myself quitting in a fit of disappointment. Looking back now, I can see how undiagnosed and untreated manic depression jeopardized my livelihood. But in the moment, all I could focus on was how I couldn’t make rent.

With housing out of reach, I alternated between staying in shelters and living on the street — there were some abandoned warehouses in the Northeast corner of the city that functioned as my go-to spot. But the instability — in and out of jobs, apartments, the streets, and shelters — only compounded my mental illness and I spiraled into addiction.

It’s impossible to explain how much of your brain homelessness takes up. It isn’t just the fact that you don’t have a home to call your own. It affects every part of your daily life, until meeting your most basic needs (What bathroom can I use? When will my next meal be? Will there be room in the shelter tonight?) requires all your time and energy.

When volunteers from the Point-in-Time Count found me, I was inches away from suicide. When I volunteer in the count, I see the memories of those days reflected in the faces of friends who are still living a life I know well. I ask them the same questions about how they’re doing and what they need to be able to do better every year, but I already know the answer.

The blame for my homelessness is always placed on me — my mental illness, my substance misuse, my joblessness — but never on the housing market. That is exactly backwards. It wasn’t until a nonprofit helped me get a subsidized apartment that I was finally able to address the things that made it so hard for me to support myself. That’s when I was able to find a doctor, get diagnosed, start treatment, and hold a steady job.

Many people will look at the numbers from this year’s Point-in-Time Count and ask how to decrease that number. My experience reveals a simple answer: If we don’t want our neighbors to be homeless, then we have to give them homes that they can actually afford. Until we do that, I’d recommend starting your outreach in the laundry room.

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Feature

Your Ultrasound Isn’t A Car. Why Are You Told To Shop Like It Is?

When my doctor suggested an ultrasound for the pelvic pain I was experiencing, my first question was “How much will that cost?” I am one of the many Americans with a high-deductible health care plan — $10,000 to be exact. I often scoff that my health insurance is a “get-in-a-doctor’s-door-plan,” because I pay cash for basically everything anyway.

My doctor, recalling my poor insurance, asked, “Do you ever get to the other side of the state?” I looked at her quizzically. “Because there’s an imaging service over there that offers ultrasounds for …” She paused and searched her computer. “Let’s see … $137, maybe closer to $300 if they think you need both abdominal and transvaginal. But it’s like a two-hour drive.”

My eyes bulged out of my head. I was billed more than $1,000 for the last ultrasound I’d had at my local hospital years earlier.

“I’ll drive,” I said.

I was relieved that my doctor told me about the discounted service. If I’d had to pay $1,000 or more out of pocket then I would have put off the procedure, like so many Americans do (and that’s if I ever got it at all). I had no idea that health care service costs could vary so wildly.

Not only do prices vary from place to place, but the amount a patient will pay for the same service within the same hospital can vary depending on whether a patient has health insurance and what health insurance plan a patient has. When I called my local hospital to compare their prices for the ultrasound, I was told that it would cost around $700 with my insurance. If I were uninsured, that price would go up to almost $1,200. Meanwhile, that $137 option was a two-hour drive away — I just had to know where to look.

People looking for a car are told to shop around, maybe get a used car, or borrow one from a friend. Too often that same ethos is pushed into the health care space, with patients told to look around for the best deal or negotiate prices with providers. But price shopping for health care services is not as straight-forward as price shopping for a vehicle, despite legislative attempts to solve the problem.

At the beginning of the year, a new rule went into effect that requires hospitals to post their list prices online. But, as Kaiser Health News points out, that kind of transparency won’t have much of an impact because patients can’t understand those prices. The lists are full of incomprehensible abbreviations, list services separately that would always be bundled together, and vary depending on a person’s specific health plan, so consumers cannot get the type of information they need for comparison shopping. Moreover, these are just the list prices charged by hospitals; they do not include the price of physicians’ services during the hospital stay.

Not everyone has a doctor like mine, who actively looked out for my financial interests. And many times, even when people do try to calculate costs ahead of time, the tools they’re given turn out to be wildly inaccurate. One person profiled by the Philadelphia Inquirer, who proactively used her insurer’s price estimator tool to calculate the out-of-pocket cost of a breast MRI, was shocked when she was billed more than twice what the tool had suggested would be the upper-end range of out-of-pocket costs for the procedure.

Plus, finding the cheapest care is just the first hurdle.

My ability to access more affordable diagnostic services depended on a lot of things aligning — I had to have flexibility in my schedule to drive to a discounted imaging service provider, and I needed a vehicle that could make the trip. When all of those things did happen, I still had to shuffle work deadlines, time the appointment so that the drive there and back didn’t conflict with my kids’ school drop-off, and arrange for after-school care for them.

Health care isn't Amazon, where items are easily searched for, compared, and where prices are fixed.

That same flexibility simply isn’t possible for everyone. Nearly 1 in 5 workers experience unstable work hours, which makes it impossible to schedule time to head to a different health provider in order to take advantage of cheaper care. Also, around 9 percent of Americans don’t own a car, and in recent years the number of people obtaining driver’s licenses has been trending downward. In rural areas, the nearest health care provider could be hours away. Though I live in an urban area, the nearest discounted service provider was a two-hour drive.

In an emergency, no one has time to inquire about costs. And even in less urgent situations, there is often no way to accurately determine prices. While hospitals are now required to post their price lists online, health care isn’t Amazon, where items are easily searched for, compared, and where prices are fixed. And high-deductible insurance plans are increasing in number, including in employer-sponsored plans, as insurers attempt to cost-shift onto consumers. That means more people are going to be in the same place I was over time.

On my drive to the other side of the state, I considered how fortunate I was to be able to access discounted health services. But being a self-employed person with a vehicle should not provide me with more options than someone with a less flexible work schedule or who doesn’t have a car. No one should have to waste precious time searching aimlessly for the best deal for treatment, and no one should have to go without because they didn’t know it was more affordable elsewhere or because the more affordable location was not accessible.

Until the U.S. chooses to recognize health care as a human right, rather than a commodity or entitlement, the poorest Americans will continue to suffer.

 

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Feature

The Shutdown Is Causing Mass Confusion for Food Stamp Recipients

“Every year, getting the materials together for SNAP recertification is difficult. They ask for a lot of information and they almost always say you are missing something no matter how much you give them,” a Supplemental Nutrition Assistant Program (SNAP, formerly known as food stamps) beneficiary explained between frantic calls to her local office for information about her benefits.

This year, the renewal process has been made even harder by the partial government shutdown, which accelerated deadlines with no notice for the more than 40 million people who receive benefits. And that’s just one of the effects the shutdown has had on SNAP and other nutrition assistance programs.

On Jan. 8, the U.S. Department of Agriculture announced that February SNAP benefits would be distributed by Jan. 20, in order to get around shutdown-related restrictions. That called for a herculean effort: Millions of new applications and recertifications that would normally be due in February now need to be submitted by mid-January. Normally, new applications and annual recertifications take place on a rolling basis. For recipients who couldn’t gather supporting material in time or didn’t know about the deadline, such as furloughed federal workers hoping for nutrition assistance while they remain without pay, the time to file for benefits has already come and gone.

At the same time, some grocers have stopped accepting SNAP because the government shutdown means they cannot renew their licenses. As the shutdown continues, the number of vendors will dwindle, a particular issue for people in areas with limited options.

The effects of these problems are wide-reaching. Nearly half of SNAP recipients are children, and LGBTQ people, along with disabled people, are much more likely to need nutrition assistance.

States administer the SNAP program, and the state-by-state chaos has been frustrating. “I have not received any update from the state’s human resource department about how this would affect us. In every other instance of benefit changes, we are sent copious written notification(s),” another recipient told TalkPoverty via email. Documentation also sometimes contradicted itself, adding even more uncertainty to the process.

Others reported that they heard about the deadline from news stories or Facebook, and struggled to get answers from officials in local offices — many of which set different deadlines, making it difficult to determine when applications and renewals needed to be submitted. At least one recipient read on social media that SNAP benefits distribution would be reversed if agencies ran out of money, something that shouldn’t be possible with EBT cards. Confusion and fear like this are familiar for many low-income people, who sometimes feel at the whims of capricious government policies and procedures.

“I’ll push myself not to use [benefits distributed early] until February but there’s a fear they could be taken away. Everything just seems so uncertain. Poor people know to use what we have when we have it because we can’t depend on what will be there in the future,” said one SNAP recipient.

SNAP is not the only nutrition assistance program with funding thrown into uncertainty by the shutdown. Also threatened are the Special Supplemental Nutrition Program for Women, Infants, and Children, known as WIC, which supplies benefits to 7 million pregnant people, new parents, infants, and children, and the Food Distribution Program in Native American communities, which fed over 90,000 people a month in 2017. The latter adds to the shutdown-induced woes — which include limitations on access to health care — in Native communities. The national free and reduced-price lunch program, which feeds more than 30 million kids annually, could also be in danger if the shutdown persists into March.

Even after the government reopens, the danger isn’t over, thanks to a dangerous Trump administration proposal to make work requirements even harsher in SNAP, which Congress explicitly refused to do in the latest Farm Bill. Currently, 33 states and Washington, D.C. have waivers in place for high unemployment areas to relieve the strict time limits for so-called “able-bodied adults without dependents” written into SNAP in 1996, which restrict benefits eligibility to three months out of every three years for those considered “able-bodied” with no legal dependents. The Trump administration wants to sharply curtail states’ flexibility to use these waivers, throwing 755,000 under- and unemployed people off SNAP.

“I don’t have contingency plans because I can’t have any,” says a disabled SNAP recipient in Colorado who struggled to get an answer about her recertification documents, normally due in February. Members of low-income communities have extensive experience creating their own safety nets to support each other through hard times, but “I think that people are going to get burnt out and stretched too thin by all the need that surrounds them.”

Editor’s note: This post has been updated to clarify the Trump administration proposal on SNAP work requirements and the current status of work requirement waivers.

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Analysis

There’s a Retirement Crisis. The New $15 Minimum Wage Bill Could Help.

We’re two weeks into the 116th Congress, every day of which has been consumed by the longest government shutdown in U.S. history. The president has manufactured this crisis, holding the government hostage to fund a symbol of his xenophobia, while ignoring the deep, snowballing damage he is inflicting on workers, families, and the economy. But Trump’s shutdown doesn’t mean newly-empowered congressional Democrats have been twiddling their thumbs.

Yesterday, House and Senate Democratic leadership introduced the Raise the Wage Act, which would gradually increase the federal minimum wage to $15 per hour by 2024. It would also link the minimum wage to median wage growth thereafter, and phase out sub-minimum wages for tipped workers, which has been stuck at $2.13 per hour for 28 years, and workers with disabilities, which allows employers to pay disabled workers as little as pennies per hour.

If passed, the new federal bill would also have far-reaching consequences that aren’t widely touted — including helping address America’s growing retirement crisis.

As of 2013, nearly one in five Americans age 55 to 64 had zero retirement savings or pension. The crisis is much more acute for lower-income Americans: While nearly nine in 10 families in the top fifth of the income distribution have retirement account savings, fewer than one in 10 families in the bottom fifth do.

It’s not surprising, then, that seniors increasingly rely on Social Security’s very modest benefits, which make up 90 percent or more of the income of nearly one in four seniors — a share that rises to more than six in 10 for those in the bottom fifth of the income scale.

The yawning gap between the high pay of the rich and the stagnant or declining pay of the working and middle class is a key driver of the crisis: According to the Urban Institute, rising wage inequality means that today’s 45-year-olds in the bottom fifth of the lifetime earnings distribution will have 3 percent less retirement income than today’s seniors, 25-year-olds will have 6 percent less, and 5-year-olds will have 13 percent less. Meanwhile, for the richest fifth, annual retirement income will rise over time.

The amount a worker can afford to save for retirement is tied to her earnings, and the Urban Institute researchers find that raising the federal minimum wage from $7.25 to just $12 — below the $15 Congressional Democrats have proposed — would offset nearly 60 percent of the retirement income lost by the bottom fifth of today’s 25-year-olds, and nearly 40 percent lost by today’s 5-year-olds.

The minimum-wage bill’s impact would be especially profound on workers of color — particularly black workers, a full 40 percent of whom would get a raise. Black workers are paid much lower wages than their white counterparts, with the typical full-time, year-round black male worker earning just 70 percent of what a white male worker earns, while black women make just 61 percent. They also face a much more severe retirement crisis, exacerbated by systematic inequalities that hamper saving, prevent wealth-building, and inhibit upward mobility. Black Americans who are nearing retirement age have only about 10 percent as much wealth as whites in the same age group. Social Security benefits made up at least 90 percent of income for 46 percent of black seniors, compared to 35 percent of whites.

The low-wage, low-quality jobs disproportionately held by workers of color don’t pay enough to make ends meet — much less save — nor do many offer the tax-preferenced retirement accounts such as 401(k) plans and individual retirement accounts (IRAs) that help build wealth. As a consequence of shorter life expectancy and lack of resources, many black men will die before they are able to retire.

This raise is a decade overdue: In 2019, a worker earning $7.25 per hour will lose nearly $2,600 compared to 2009 — when the federal minimum wage last went up — because inflation has eroded the wage’s purchasing power. A $15 minimum wage would also lift millions of Americans out of poverty, dramatically reduce spending on public assistance programs, and improve infant health. In just the last five years, 22 states and Washington, DC, have increased their minimum wages, at little or no cost to government and without the job losses conservative pundits claim will result.

Americans get it: In every single state, voters say want their state’s minimum wage to be higher than it currently is. By passing the Raise the Wage Act, Congress would rightly give voters what they’re demanding, and help address the retirement crisis at the same time.

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