Though the definition is much debated, the oft-maligned so-called “trickle-down” theory of economics generally holds that lower taxes on wealthy individuals and corporations benefit everyone, including people further down the income stream, because that preferential tax leniency frees its recipients to become “job creators.”
Politicians like Senator Bernie Sanders and other economic populists have long excoriated the notion, most often associated with the economic priorities of the Reagan administration, contending that trickle-down is a fallacy.
The Trump administration’s signature economic package — the One Big Beautiful Bill Act (OBBBA) — essentially makes a bet similar to Reagan’s, extending and in some cases expanding Trump’s own 2017 tax cuts that largely benefitted the wealthiest citizens.
Evidence of the policy’s trickle-down effect is hard to find especially this week, as large-scale layoffs at Amazon in particular — a major beneficiary of Trump’s tax policies — signal that money trickling down in the form of job creation isn’t axiomatic, as some Republican lawmakers and economists assert.
But can money trickle up? Or at least trickle in? That’s the assertion being made by some Democrats making a pragmatic economic case — as opposed to a humanitarian one — for paying out SNAP benefits while the federal government remains closed.
Rep. Sara Jacobs (D-CA) posted this week what she called a “reminder” about the secondary impact of the social safety net that provides food security for millions, a large percentage of whom are children.
“Every dollar in SNAP benefits spent generates about $1.50 in economic activity,” Jacobs wrote.
[NOTE: About 42 million Americans receive an average of about $187 in SNAP benefits each month, according to the USDA, which administers the program. SNAP pays out approximately $8 billion a month.]
A timely reminder that every dollar in SNAP benefits spent generates about $1.50 in economic activity.
So when Trump fails to use USDA’s contingency dollars to keep SNAP benefits going, 40 million Americans will go hungry AND our economy will lose out on billions in activity.
— Congresswoman Sara Jacobs (@RepSaraJacobs) October 29, 2025
The Congresswoman references how the SNAP money moves into the American economy almost immediately, trickling into various businesses. [The National Grocers Association (NGA), a trade association representing the independent grocery industry, estimates that SNAP funding “supports approximately 388,000 jobs, over $20 billion in direct wages, resulting in over $4.5 billion in state and federal tax revenue.”]
Where trickle-down economics parks money in corporate coffers and, depending on the economic winds, are as likely to trigger stock buybacks as job creation, SNAP money enters the flow of the economy entirely and immediately.
The Center on Budget and Policy Priorities reports, citing the USDA and supporting Rep. Jacobs’ assertion, that “in a weak economy, $1 in SNAP benefits generates $1.50 in economic activity.”
Explaining the swift movement of the distributed funds, CBPP writes: “Households receive SNAP benefits on electronic benefit transfer cards, which can be used only to purchase food at one of about 261,400 authorized retail locations around the country.”