Americans are relying on the federal government’s Supplemental Nutrition Assistance Program (food stamps) more than ever before, even as the economy has steadily recovered. Enrollment has soared 70 percent since 2008, to a record 47.8 million at the end of 2012 while the unemployment rate slowly but steadily dropped. Analysts at the Congressional Budget Office expect participation in the program to rise again this year. - Read more at The Wall Street Journal
ECONOMY GREW BY 0.4 PERCENT The U.S. economy grew by 0.4 percent in the last quarter of 2012, a slightly faster rate than the previous estimate of 0.1 percent and a reversal of the original estimate of the 0.1 percent decrease, the Commerce Department said Thursday. Economists estimate the Gross Domestic Product is growing at a rate of around 2.5 percent in the first quarter of 2013, which ends this week. - Read more at Bloomberg
WHY THE MIDDLE CLASS HURTS AS THE UPPER CLASS GROWS A newly revised paper by Marianne Bertrand and Adair Morse from the University of Chicago’s examines income inequality has made “Keeping up with the Joneses” dangerous for the economy.
The authors suggest “trickle-down consumption,” has caused many middle-income households to save less, and spend beyond their means in order to stay close to a wealthier group that is pulling away from them. The authors credit the “trickle-down consumption” theory for roughly one-fourth of the decline in household savings rates since the early 1980s. “Middle income households would have saved between 2.6 and 3.2 percent more by the mid-2000s had incomes at the top grown at the same rate as median income,” the study says. - See the study here
MORE SENIORS ARE SPENDING THEIR GOLDEN YEARS IN DEBT “For the past several decades, millions of senior citizens have been able to enjoy relatively safe retirements, in part due to a lifetime of savings, private pensions, Social Security, Medicare, and home ownership,” The Fiscal Times’ Josh Boak writes. However, now “several recent studies indicate that the degree of safety might be eroding, as personal debt has become a way of life for a growing number of Americans older than 65.” - Read more at The Fiscal Times
AMERICANS ARE STILL PESSIMISTIC ABOUT THE ECONOMIC OUTLOOK According to the Peterson Foundation’s monthly Fiscal Confidence Index, public confidence in the economy sits at a low 46 (100 being neutral) This is slightly up from last month’s reading of 43 and January’s reading of 40. - See the index here
DEPT. OF ENERGY HANDS OUT CUSHY SALARIES TO CONTRACTORS The Energy Department significantly overpaid contractors to clean up an old nuclear plant in Tennessee, the Inspector General for the Department of Energy said on Wednesday. According to the IG report, the $2.2 billion contract to manage an environmental cleanup at the East Tennessee Technology Park in Oak Ridge, Tenn., included salaries for ten executives of up to $337,581, 82 percent higher than the corresponding market rates for those positions. - Read the report here
GOV WORKERS KNOW 86,000 WAYS TO CUT WASTE Federal workers have used an online White House program to submit ideas on slashing excess spending. Implemented in 2009, the Save Awards received this year 86,000 suggestions, 67 of which the Obama administration plans to recognize in its forthcoming budget. The suggestions range from the practical “agencies should do away with paper, and rely on electronic documents,” to the less conventional “use government goats to cut weeds.” - See their suggestions here