Posted on 01/26/2011 11:06:45 AM PST by bronxville
Saturday, January 22, 2011
Food Stamps as a JPMorgan Growth Industry
By Economic Collapse Blog
JP Morgan is the largest processor of food stamp benefits in the United States. JP Morgan has contracted to provide food stamp debit cards in 26 U.S. states and the District of Columbia. JP Morgan is paid for each case that it handles, so that means that the more Americans that go on food stamps, the more profits JP Morgan makes. Yes, you read that correctly. When the number of Americans on food stamps goes up, JP Morgan makes more money.
In the video posted below, JP Morgan executive Christopher Paton admits that this is "a very important business to JP Morgan" and that it is doing very well.
Considering the fact that the number of Americans on food stamps has exploded from 26 million in 2007 to 43 million today, one can only imagine how much JP Morgan's profits in this area have soared. But doesn't this give JP Morgan an incentive to keep the number of Americans enrolled in the food stamp program as high as possible?
There are just some things that are a little too "creepy" to be "outsourced" to private corporations. The JP Morgan executive in the interview below does his best to put a positive spin on all this, but it just seems really unsavory for a big Wall Street bank to be making so much money off of the suffering of tens of millions of Americans....
So if unemployment goes down will this ruin JP Morgan's food stamp business?
Well, apparently not. In the interview Paton says that 40% of food stamp recipients are currently working, and he seems convinced that there could be further "growth" in that segment.
So is this what America is turning into?
A place where tens of millions of the unemployed and the working poor crawl over to Wal-Mart and the dollar store every month to use the food stamp debit cards provided to them by JP Morgan?
It turns out that JP Morgan also provides child support debit cards in 15 U.S. states and they also provide unemployment insurance benefit debit cards in seven states. http://www.economicpolicyjournal.com/2011/01/food-stamps-as-jpmorgan-growth-industry.html
Considering the fact that the number of Americans on food stamps has exploded from 26 million in 2007 to 43 million today, one can only imagine how much JP Morgan's profits in this area have soared. But doesn't this give JP Morgan an incentive to keep the number of Americans enrolled in the food stamp program as high as possible?
They don’t make that much. Its a complex system with lots of overhead. Rumors abound they are trying to sell this business unit because its not profitable.
They bought the group from Citi a few ago.
Did you listen to the tape? They make a lot. Not much different from the money made from Medicare and Medicaid home visits. Agencies market at hospitals for business - some need it but a lot of them don’t...
Clarification - not pointing fingers at those who need stamps as I’m sure most of them do ...just meant I know a little about the agencies who market for patients.
I have first hand knowledge of this group. Lots of volume but margins are razor thin.
Then there’s states like CA who occasionally pay late.
JP Morgan Cloward Piven.
Thanks for the info. The guy appeared to make it a profit-making deal and considering the increase in stamps they must be making something. It appears we’re going to end up having a monoply of 2-3 conglomerate banks - not good for capitalism - bring back Glass-Steigal. They’ve been settin gthis up for decades. Robert Rubin got Clinton to sign it and the next morning Rubin was at Citibank - got 20mil the first year - I’m sure Clinton got a cut.
Yes, a look at our future.
yeah I agree that is where its headed. IMO JPMorgan is a horrible company as are all big banks.
As long as this plan still exists, the debit card business for it should go ONLY to smaller regional banks - not the majors.
That would be nice, but unlikely.
I remember coming across some info on the last depression about banks. I guess the FED’s closed a majority of the NON Fed bankds that were operating back then. Same will happen again. More and more concentration of control and wealth.
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