Why Trump's spending bill could close your grocery store

Summary

Summary of "Why Trump's Spending Bill Could Close Your Grocery Store"

The Indicator from Planet Money, NPR
Episode: Why Trump's Spending Bill Could Close Your Grocery Store
Release Date: August 13, 2025

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1. Introduction

In the August 13, 2025 episode of The Indicator from Planet Money, hosts Waylon Wong and Stephen Besarja delve into the ramifications of President Donald Trump's new tax and spending law. This legislation marks the largest historical cut to the Supplemental Nutrition Assistance Program (SNAP), commonly known as food stamps, raising concerns about its broad impact on American families and local grocery businesses.

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2. Overview of the New Tax and Spending Law

Waylon Wong introduces the discussion by highlighting that Republicans are actively promoting the new tax and spending bill, which notably targets SNAP with substantial budgetary reductions.

"Republicans are on the road selling President Donald Trump's new tax and spending law,"
— Waylon Wong [00:12]

Stephen Besarja explains that the legislation enacts the largest cut in SNAP's history, aiming to reduce federal expenditures by approximately $190 billion over the next decade through mechanisms such as new work requirements and caps on benefit increases tied to inflation.

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3. Impact on SNAP and Beneficiaries

SNAP is a crucial safety net for around 12% of U.S. residents, assisting millions in purchasing groceries. Approximately 40% of SNAP recipients are children, making the program vital for family nutrition and stability.

Ken Cobb, a professor at Furman University specializing in food access and retail, underscores the strain on families even before the proposed cuts:

"It's heart-wrenching, honestly, like parents skimping on their own food so that their kids can have an extra portion. Like that's just sad."
— Ken Cobb [00:51]

Cobb emphasizes that the proposed legal changes could exacerbate these hardships by potentially reducing SNAP’s effectiveness in supporting vulnerable families.

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4. Effect on Independent Grocers

The new law poses a significant threat to independent grocery stores, particularly those in low-income areas where SNAP constitutes a substantial portion of their sales. At Wright's Market in Opelika, Alabama, owner Jimmy Wright reveals that approximately one-third of their business is driven by SNAP benefits, a figure that can soar up to 70% for some independent grocers.

"We're somewhere around the third of our business come through SNAP."
— Jimmy Wright [04:01]

Wright expresses concern that these cuts could force many small grocery stores to shutter, especially in regions already categorized as food deserts—areas with limited access to affordable and nutritious food.

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5. Economic Ripple Effects

Beyond immediate impacts on families and grocery stores, SNAP plays a pivotal role in the broader economy. A 2019 study by the U.S. Department of Agriculture estimated that every additional dollar in SNAP benefits injects approximately $1.50 into the U.S. gross domestic product. This multiplier effect supports not only farmers and food producers but also various sectors connected to the food supply chain.

"One of the big clamors for grocery stores is that they offer healthy food, but they also provide jobs. They're businesses where people are coming and going. They produce food, foot traffic, they have lighted parking lots. They're perceived as safe. They fill all sorts of other community needs besides just filling people's shopping carts."
— Ken Cobb [05:59]

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6. Political Debate and Justifications for Cuts

Republican lawmakers argue that SNAP is a significant expense, costing the federal government around $100 billion in the last fiscal year. The primary justification for the cuts is to reduce these costs to help fund other tax reductions. Additionally, Republicans have claimed that SNAP is prone to fraud and waste, citing an approximate 11% error rate in over and underpayments, though these are typically administrative rather than intentional abuses.

"The main thing is that SNAP is expensive. Last fiscal year, it cost the federal government about $100 billion."
— Waylon Wong [06:31]

Stephanie Johnson from the National Grocers Association acknowledges the impact but notes that the actual cuts were less severe than initially proposed, thanks to lobbying efforts.

"The cut we got is about a third the size of the one originally proposed."
— Stephanie Johnson [06:50]

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7. Fraud and Its Impact on Grocery Stores

While Republicans highlight alleged fraud within SNAP, the reality is more nuanced. Most SNAP beneficiaries are eligible, and fraud is relatively low. However, grocery stores face challenges such as skimming, where fraudsters install devices on card readers to steal benefits. Jimmy Wright shares his experience with such an incident, which incurred significant costs for technology upgrades.

"They were driving. One of the guys was driving this monster four door Chevy Suburban and he had backed into the parking lot over here on the other side of the store. The other guy was right on the end of the building."
— Jimmy Wright [08:29]

The financial strain of combating fraud adds to the already thin margins that independent grocers operate under. Wright mentions that for every dollar spent at his store, only about one and a half cents are net profit, making it exceedingly difficult to absorb unexpected expenses.

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8. Case Study: Wright's Market

Wright's Market exemplifies the struggles faced by small grocery stores in the wake of SNAP cuts. With a significant portion of revenue dependent on SNAP, any reduction threatens the viability of the business. Wright is determined to prevent job cuts and price hikes despite financial pressures, highlighting the delicate balance these businesses must maintain.

"That would be the very, very, very, very last thing that I did on that. You know, the last two things I want to do is try to raise prices on people that are struggling. And I certainly don't want to do anything to my employees."
— Jimmy Wright [09:20]

His story reflects the broader concerns of independent grocers who serve as essential community hubs, offering not just food but also employment and a sense of safety.

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9. Conclusion

The episode concludes by reaffirming the critical role SNAP plays in supporting millions of American families and sustaining local grocery businesses. The proposed cuts to the program not only threaten the nutritional well-being of vulnerable populations but also jeopardize the economic health of independent grocers and the communities they serve. As policymakers weigh the costs and benefits, the voices of economists, business owners, and affected families highlight the far-reaching consequences of reducing SNAP funding.

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Notable Quotes:

• "It's heart-wrenching, honestly, like parents skimping on their own food so that their kids can have an extra portion. Like that's just sad."
  — Ken Cobb [00:51]

• "We're somewhere around the third of our business come through SNAP."
  — Jimmy Wright [04:01]

• "One of the big clamors for grocery stores is that they offer healthy food, but they also provide jobs... they fill all sorts of other community needs besides just filling people's shopping carts."
  — Ken Cobb [05:59]

• "That would be the very, very, very, very last thing that I did on that... I certainly don't want to do anything to my employees."
  — Jimmy Wright [09:20]

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This comprehensive examination by The Indicator from Planet Money underscores the interconnectedness of federal policies, economic stability, and community well-being, illustrating how changes to SNAP can have profound and lasting effects across multiple sectors.

Transcript

[NPR Host]

NPR.

[Waylon Wong]

Republicans are on the road selling President Donald Trump's new tax and spending.

[Stephen Besarja]

Law, and we're on the road to digging into what that law actually does. In today's case, we're looking at how the act makes the largest cut in history to one of the country's biggest safety net programs.

[Waylon Wong]

That would be the Supplemental Nutrition Assistance Program, also known as SNAP or food stamps. About 12% of U.S. residents receive SNAP to help pay for groceries, and about 40% of them are children.

[Stephen Besarja]

Ken Cobb is a professor at Furman University who studies food access and retail. He says families on SNAP were already squeezed tight before these cuts.

[Ken Cobb]

It's heart wrenching, honestly, like parents skimping on their own food so that their kids can have an extra portion. Like that's just sad.

[Stephen Besarja]

Ken says this law will also have a second effect on those families. Some could lose access to their only grocery store.

[Waylon Wong]

This is the indicator from Planet Money. I'm Waylon Wong and I'm here with friend of the show Steven Besarja from the Gulf States Newsroom. Welcome back, Stephen.

[Stephen Besarja]

Good to be with you, Waylon. And on today's show, grocery stores have super tight margins and a large portion of their profits often come from snap. So we are off to Opelika, Alabama, to talk to a grocery store owner about what these cuts mean for markets.

[Waylon Wong]

Like his and why they'll be felt far beyond the checkout aisle.

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[Waylon Wong]

Wright'S Market is an independent grocer, but really, it doesn't look all that different from your classic supermarket. Just a bit small. You've got your aisles packed with sweet tea, veggies and the best fresh catfish that shopper Diane Chavis says you can find. I'm an old country girl, so I like old country products and that is a lot of what you can find in here.

[Stephen Besarja]

And what brought you in today.

[Waylon Wong]

Best ground beef in town. My husband, if I'm in a hurry and have to stop somewhere else, he can tell every time as soon as he bites into it that I haven't gone to Wright's to get that ground beef. Oh, my gosh, I gotta try this ground beef. I'll go over for taco night.

[Stephen Besarja]

I don't think my ground beef palate is, like, refined enough to tell the difference.

[Waylon Wong]

Oh, absolutely not.

[Stephen Besarja]

Now, that ground beef and the catfish and all sorts of other things at Wright's market can be bought using snap. Basically, SNAP helps people with low income buy certain approved items like fruit snacks and milk. If you look at last year's numbers, about 42 million people receive SNAP each month.

[Waylon Wong]

And a lot of that spending happens at grocery stores. The National Grocers association says about 12% of grocery sales in the US come from SNAP.

[Stephen Besarja]

But that's the number for all grocers together at Wright's. That percent is much higher.

[Jimmy Wright]

We're somewhere around the third of our business come through snap.

[Waylon Wong]

That's owner Jimmy Wright. And while a third of his business is pretty significant, at some grocers, Snap is the majority of their sales.

[Stephen Besarja]

And those are the stores Jimmy is most worried about. Like beyond his own business. Jimmy helps small grocers too. He was even once named Grocery Champion of the Year for that.

[Waylon Wong]

He's not concerned about your Publix or your Whole Foods, but he is worried about the independent grocers in low income areas where Snap can make up as much as 70% of their sales.

[Jimmy Wright]

I get concerned that in changes in the program, you know, will that have a negative effect on these small stores in rural America and in urban America where they cannot stay open?

[Stephen Besarja]

Trump's new tax and spending law is estimated to cut about $190 billion from SNAP over the next decade. It does that through things like new work requirements and caps on how much benefits can rise based on inflation.

[Waylon Wong]

Ken Cobb is a professor at Furman University, and he says smaller independent grocers could close because of lost Snap sales.

[Ken Cobb]

Yeah, I mean, it will. It will cut down some retailers to.

[Waylon Wong]

Make the situation worse. These stores are often located in areas that would otherwise be considered food deserts.

[Ken Cobb]

So those are the areas with the least amount of offerings of fresh and healthy produce, healthy cuts of meat. And so it does go. It hurts where people need it the most.

[Waylon Wong]

And Ken says the ripple effect of this actually goes further because those SNAP dollars are not just an Aid to people who get it or grocery store owners, but also the overall like.

[Stephen Besarja]

Take this 2019 paper from the U.S. department of Agriculture. It estimates that during tough times, every additional dollar in SNAP Benefits can add $1.50 to the country's gross domestic product. That includes both your California farmers getting extra orders for broccoli to the local H Vac guy making sure those peas stay frozen.

[Ken Cobb]

One of the big clamors for grocery stores is that they offer healthy food, but they also provide jobs. They're businesses where people are coming and going. They produce food, foot traffic, they have lighted parking lots. They're perceived as safe. They fill all sorts of other community needs besides just filling people's shopping carts.

[Waylon Wong]

We reached out for comment from the US Department of Agriculture, which is the agency that runs snap. We did not hear back.

[Stephen Besarja]

Okay, so with all these benefits that SNAP provides to families in need to local businesses, why is SNAP being cut anyway?

[Waylon Wong]

Well, the main thing is that SNAP is expensive. Last fiscal year, it cost the federal government about $100 billion. And Republican lawmakers were for ways to lower the cost for tax cuts that were set to expire. One of the ways was with these SNAP cuts. The new law is expected to cut the program by about 20%.

[Stephen Besarja]

Stephanie Johnson is with the National Grocers association, and she says, yes, this will impact grocery stores. But she points out that the cuts were originally much steeper. Her association lobbied Congress for a more limited one, and Congress did that. The cut we got is about a third the size of the one originally proposed.

[Waylon Wong]

And you know what? She says it's not all bad. The tax cuts in Trump's tax and spending bill that Republicans were looking to fund will benefit grocery businesses.

[NPR Host]

We're very excited about the tax cuts in that package. I just want to say we are.

[Waylon Wong]

We were strong supporters of the certainty.

[NPR Host]

That those continuing those tax provisions gave to our members.

[Stephen Besarja]

Republican lawmakers also accuse SNAP of being filled with fraud and waste. Last year, the program had a roughly 11% error rate for both over and underpaid benefits, though those are usually administrative errors, not recipients cheating the system.

[Waylon Wong]

In fact, a lot of fraud in SNAP is not from people on the program. According to the USDA's website, the vast majority of SNAP recipients are eligible. In fact, it's often those recipients who are the victims of fraud.

[Stephen Besarja]

Yeah, like how SNAP benefits often get stolen using skimmers. Basically, you get these bad actors installing these devices onto the card readers at stores. Then when someone swipes their SNAP card, it logs that info and the fraudsters steal Those benefits.

[Waylon Wong]

One group actually installed these kinds of devices at Jimmy Wright's market.

[Jimmy Wright]

And I caught them about five minutes after they did it, they were gone.

[Stephen Besarja]

What did it look? Were they just like suspicious with like a big coat hiding what they were doing by them?

[Jimmy Wright]

They were driving. One of the guys was driving this monster four door Chevy Suburban and he had backed into the parking lot over here on the other side of the store. The other guy was right on the end of the building. So just one of those things that didn't look right. We spent $8,000 to replace all of our pin pads up front into a one that's got the anti skimming device on it.

[Waylon Wong]

And you mentioned that grocery stores have a really thin margin, right? So how is a grocery store supposed to get $8,000 for emergency like tech replacement?

[Stephen Besarja]

Yeah, exactly. Like you said, like every extra expense, including those lost dollars, you just. SNAP matters for a Jimmy's.

[Jimmy Wright]

I mean, we're a penny business.

[Waylon Wong]

He means that literally. He says for every dollar spent at a store like his, grocers only net about a penny and a half.

[Stephen Besarja]

Jimmy hopes those lost SNAP dollars do not mean having to cut jobs.

[Jimmy Wright]

That would be the very, very, very, very last thing that I did on that. You know, the last two things I want to do is try to raise prices on people that are struggling. And I certainly don't want to do anything to my employees.

[Stephen Besarja]

Jimmy doesn't want to get into the politics of this. He says the cuts happened and he's now just got to deal with them. But he is concerned about what this means for grocery stores and the customers he's been serving for most of his life.

[Waylon Wong]

This episode was produced by Corey Bridges and engineered by Robert Rodriguez and Jimmy Keeley. It was fact checked by Sierra Juarez. Kate Concannon is our show's editor and the indicator is a production of npr.

[NPR Host]

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