January 16, 2014
blessings of “gridlock.”
The Senate and
House of Representatives have yet to reach agreement on a “farm bill.” Informed
taxpayers are grateful for the impasse.
rightly note that the latest five-year
plan for U.S.
“agriculture” is mostly about welfare. According to the American Enterprise Institute,
“nutrition” assistance -- e.g., food
and school lunches -- constitutes “the largest means-tested federal poverty
programs outside Medicare.”
But let’s save
the dole for another day. Whatever its final form, if passed, 2014’s farm bill
will redistribute hundreds of billions of dollars to landowners and
agricultural firms, meddle with commodity markets at home and abroad, and
incentivize unwise land-use decisions. Liberal, conservative, and libertarian
think tanks and activist organizations realize the legislation’s folly.
farm in America
gets treats from government -- state perks are more numerous than federal largesse -- some enjoy special status.
Wheat, corn, soybeans, rice, and cotton gobble up nearly all of the U.S.
Department of Agriculture’s subsidies. The generosity takes many forms, from
crop insurance to counter-cyclical payments, conservation grants to research
can be traced back to the 1930s, when the Dust Bowl and Great Depression laid
waste to the rural heartland. Back then, farm families were generally poorer
than their urbanized, factory-working counterparts. Mechanization
hadn’t fully taken hold. Pesticides and fertilizers weren’t affordable and
farmers live in a world that would be unrecognizable to Tom Joad. Agriculture is
safer, more efficient, and far more lucrative. The Mercatus Center’s Veronique de
Rugy wrote that in 2010, “the average farm household earned $84,400, … about
25 percent more than the average household income nationwide.” Net worth is
higher, too, and nonfarm income accounts for a sizable chunk of earnings. “Agritainment” and “agritourism” are now key
components of many business models.
of Agriculture put
2013’s net farm income at $131 billion, “up 15.1 percent from 2012’s
estimate of $113.8 billion.” After adjustment for inflation, the figure “is
expected to be the highest since 1973.” A few weeks ago The Financial Times reported that the value of farmland “in states
such as Illinois and Iowa have increased 77 per cent in the past
economic, fiscal, and environmental reasons to halt freebies to agriculture, a
coalition is mounting fierce, if ultimately doomed, opposition. In December,
the National Taxpayers Union and
Public Interest Research Group published a
common-ground list of expenditures ripe for the chopping block. Using
Congressional Budget Office assumptions, their tally for the ten-year savings
from elimination of agriculture’s two costliest subsidy programs tops $129
cropitalism,” Citizens Against
Government Waste charged that both chambers’ versions of the farm bill “expand
crop insurance subsidies, leave intact the market-distorting sugar and dairy
programs, and fail to repeal the corporate-welfare stalwart, Market Access
Program.” The Heritage Foundation lamented
that Congress “continues to treat agriculture as if it were 1933.” Earlier
this month, the Environmental Working Group’s vice president of government
affairs told The Wall Street Journal
that switching direct payments to farmers for enhanced crop insurance was “moonshine
by another name” that would replace “a discredited subsidy with a soon-to-be
A betting man
would wager that resistance is futile. Farm-state fedpols from both parties
know what it takes to get reelected. They’re experts at cutting deals with
their urban colleagues. And a poll-conscious Barack Obama won’t take a
principled stand for spending restraint. After more than a year of delay, it
appears that a farm-bill compromise will be reached in February.
One day, real austerity is headed to Washington. (A weak
economy, aging population, $17.3 trillion in debt,
and possibly as much as $200 trillion in unfunded liabilities assures it.) When
fiscal can-kicking is no longer an option, and their goodies vanish, will
commodity farmers survive? Probably, but even if times get tough, there are
alternatives. The fruit, vegetable, nut, and shrubbery industries aren’t wards
of Washington, yet “specialty” crops thrive in
and contribute much to the agricultural sector’s dynamism. Driven by what
the Los Angeles Times called “robust
foreign demand,” California
growers are harvesting three times as many almonds as they did a decade and a
half ago. Last summer, the
Mushroom Council’s president predicted that in 2013, his industry would
achieve “the greatest annual shipment increment in history.” And kale’s
sales are skyrocketing.
politically sheltered farmers can’t rely on New Deal-style “support” much
longer. So sad that they can’t see the red ink on the wall.
D. Dowd Muska (www.dowdmuska.com) writes about government, economics, and technology. Follow him on Twitter @dowdmuska.
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