Posted on 05/16/2008 11:14:08 AM PDT by newbie2008
Too much spending: The bill increases spending by almost $20 billion over the next ten years, at a time when net farm income is at an all-time high. Much of this additional spending is disguised by budget gimmicks that take advantage of formal scoring rules to hide real spending increases.
New sugar program: The bill would make the government buy sugar for 2X the world price, store it, then resell it at about an 80% loss to the taxpayer. Sugar sells for about 11¢/lb on the world market. The US government would have to buy sugar for about 22¢/lb, store it, and then auction off the excess to ethanol plants. We estimate that such an auction would net the government about 4¢/lb. In addition, this new provision would require the government to guarantee that domestic sugar producers get 85 percent of the domestic sugar market.
Subsidies for rich farmers: Farmers would be eligible for government subsidy payments if their incomes were as high as $1.5 million if married, and up to $750,000 if single. We had a big fight with Congress last year over whether families with income of 3 times the poverty level should receive taxpayer-subsidized health insurance. This bill would subsidize amarried farming couple with income more than 107 times the poverty level (which is $14,000 for a couple). Put another way, such a couple would be in the top 0.2% of the income distribution. You would be subsidizing their business with your income taxes.
Getting the best of both worlds: “Beneficial interest” is a provision of current law which allows you to lock in a government subsidy payment when the market price for your good is low, and then hold the actual good and sell it when the market price is high. You thus get the best of both worlds – subsidy payments as if crop prices were low, but profits from selling your good at a higher price. The President proposed a “pick-your-price” reform, in which you lock in the subsidy at the same time that you lock in the sale price, so you can’t play timing games. The conference report does not include this reform, and continues the practice of current law.
Using food aid $ inefficiently: Under current law, US food assistance for hungry people around the world must be spent purchasing US crops. The President proposed to allow up to 25 percent of US global food assistance to be spent purchasing food from local farmers (in the country where the people are starving). This allows US dollars to be spent purchasing food, rather than paying transportation costs. It also encourages the development of farming infrastructure in these countries. Congress failed to include this forward-looking policy that will help save lives overseas. This means fewer starving people will get food, and these countries’ farming infrastructures will be less well developed.
Not just veto. Bush should thrash this one out in public as long and loud as he can. The congresscritters who voted for this turkey should not just be stymied, they should be publicly humiliated and ridiculed.
Do I hear “Bloated ethanol profiteers” anyone?
The White House staffers should email their best lines to the late-night comics.
The only way to do away with this giveaway of taxpayer money to farmers is to do away with the Electoral College and the Senate. The Farm States have too much power and thus are able to leech more off of the Taxpayer.
The bill passed 81-15 in the Senate and 318-106 in the House. Any veto will be overridden in a heart-beat and will make Bush look even weaker than he already does.
President Bush can't sign every spending bill in sight for 7 years then suddenly claim to be a fiscal conservative. Nobody's buying it.
Of course, the Dim’s aren’t serious about this bill at all. This is a trap for Repubs as I see it. Bush vetoes, and then they can scream and holler and whine about how the Republicans don’t have the interest of the lowly farmer in mind.
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