Is there a third solution I'm not seeing or are we just going to descend into a feudal dystopia?
Realistically? Make people farmland owners again, so they always have a job to fall back on (farming). That way, working for a corporation becomes optional. And stop allowing in illegal immigrants, who, being landless by default, will have to be substituted by the landed citizens one way or another.
Next thing you know they'll say that all those eliminated SNAP benefits (and resulting purchases) are saving money on storage space, refrigeration, gasoline (for transport), labor. All that money saved!
Call me old-fashioned, but if you are not actively looking for a job, you shouldn't get any benefits from the government (including SNAP). People permanently reliant on SNAP are a burden on taxpayers and a contributing factor to inflation (since they consume without producing). To reply to your assertion directly, any reduced demand from all those eliminated SNAP benefits is a good thing for the productive people, since it will bring down prices (supply and demand etc).
No directory.