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Farming the Taxpayers-The farm-subsidy faucet is being turned up, full blast
NRO ^ | 05/02/02 | Stephen Moore

Posted on 05/02/2002 8:52:26 AM PDT by gubamyster

Ross Perot used to tell a story about visiting the Department of Agriculture in Washington where he saw a bureaucrat from the USDA sitting behind a desk crying rivers of tears. Perot said, "My God, man, what in the world is wrong?" The bureaucrat responded, "My farmer died."

We're not quite there yet — one USDA worker for every farmer — but we're getting closer everyday. Over the past 30 years in the United States, the number of full-time farmers has fallen by about half, but the number of USDA employees has increased by nearly 50%. And the dollars paid out by the USDA to the shrinking number of farmers has accelerated even more rapidly.

A few years ago it seemed as though farm socialism was finally going to be abandoned in the U.S. in favor of a try for the free market. The congressional Republicans heroically passed a sterling piece of legislation called the "Freedom to Farm Act." Subsidies to farmers would be gradually phased out (in fact, next year was to be the last for federal aid to farmers). The U.S. government would only intervene in times of crisis, such as a drought. That "crisis" loophole was invoked every year, and in some years in the late 1990s, farmers got more aid under Freedom to Farm than they got during the old subsidy scheme.

But now the farm-subsidy faucet is going to be turned up full blast. Under the latest scheme, concocted by farm-state Republicans and farm-state Democrats alike, the federal taxpayer will now dole out at least $100 billion over the next 6 years to farmers. And the Heritage Foundation has discovered this outrage: many farmers will receive more than $1 million in subsidies over the next 6 to 10 years if this monstrosity of a bill is approved by Congress and then signed into law.

TOO GOOD FOR THEIR OWN GOOD

Many farm-state politicians, people like Tom Daschle, have howled in protest when I have blasted these luxurious crop subsidies as "welfare for farmers." How can I so cavalierly denigrate the great American farmer? Daschle has complained. Well, there is no question that the American farmer is in many ways heroic. The American farmer today produces 3 times more food on one-third as many acres, with one-third as much manpower as was the case in the 1920s. This is a productivity success story for the ages.

The Iowa, Illinois, Nebraska, and Kansas farmers are the true bread basket of not just the U.S., but the whole world. Indeed, farmers are victims of their own stunning success. The more productive the farmers become, the less farmers we need to feed us. This is a good deal for the 98% of us who only consume our food, and don't grow it.

Most of America's giant rice, cotton, and corn farmers are, to be sure, "welfare recipients." In fact, most farmers I talk to admit that what we have is a farm welfare system today. Bill Clinton used to refer to it as "the farm safety net." Okay, fine. Then why not a "telecom safety net" or a "semiconductor safety net" or a "beauty parlor safety net," or . . . I better stop before I start giving lawmakers any ideas.

What is more, a strong case can be made that the gigantic payoffs that the Congress makes to farmers do not benefit the vast majority of small- and medium-sized family farms. Most of the money goes to the very farm conglomerates that small farmers are having such difficulty competing with. That is why this farm bill will have exactly the opposite effect that it's supporters are promising. It will accelerate, rather than arrest, the decline of the old-fashioned family farmer. Why? Because the vast amount of the benefits reward their agri-giant rivals.

A definition of insanity could be to try something over and over and over again even when it never produces the intended result. The U.S. government has spent more than $150 billion in farm aid since the late 1970s, and yet every year more marginal farmers go out of business. One explanation for this is that the price-support system rewards the largest producers, because the more bushels you produce, the bigger your check from Uncle Sam. Of course, other years we paid farmers not to grow things, and that turned out to be a boondoggle, too.

Farm socialism has also had the negative effect of impeding the creation of market-based solutions to the age-old farm problem of rapid swings in production and prices from one year to the next — due to bad weather, good weather (especially), or foreign competition, etc. If the feds were to get out of the farm-protection racket, private crop insurance markets would develop and mature and adequately spread the risk against bad years. Nowadays, few farmers take out private insurance, because they know Uncle Sam will always be there to be the insurer of last (or rather, first) resort.

We are trying to achieve, with our dysfunctional farm policies, what George W. Bush and many Midwestern industrial states are trying to do with the steel industry: prop up those artificially companies that are non-competitive in the global market place so that they don't have to face the sometimes cruel fate of a free market. And just as steel tariffs only slow down the inevitable collapse of non-competitive U.S. steel producers, to the detriment of the rest of us, so it is with the farm sector. We are not saving the most unproductive family farmers, we are only insuring that they die a slow, agonizing death. Five years from now the farmers, whose heads we are propping up above water today, will be complaining with greater fervor. Next they will be demanding a $200 billion farm bill.

COME TO MARKET

Two-thirds of small businesses fail in America. Why should farmers — or steel companies — be treated any differently.

With steel and farm policy, the beneficiaries of the free-market solution are consumers — because the free market policy is what creates steadily falling prices. Corn, thankfully, is never going to go back to the inflated prices that farmers fetched in the 1970s.

So today we are confronted with what might very well be the single worst farm bill — it is certainly the most expensive — in American history. Freedom to farm has been converted into freedom to farm taxpayers. This bill will pass Congress by a wide margin for the simple reason that it is crucial to the political survival of incumbent farm-state senators and congressmen. To insure enough votes, the farm-state politicians have passed out the goodies widely, so that California avocado growers, Vermont milk farmers, Virginia horse breeders, and East Coast oyster fishermen all get a slice of the welfare cake.

This bill will very soon land on George W. Bush's desk. He will face the same agonizing decision that he faced on steel tariffs two months ago. Let us hope that this time the White House puts the nation's economic well being ahead of the special-interest hoards, and that President Bush vetoes farm socialism.

CORRECTION

In my last column, I quoted New York Times reporter David Cay Johnston's review of a book in a way that may have confused readers and raised objections from Mr. Johnston. My column suggested that Johnston himself endorses higher taxes on the rich; a view that Johnston says he was not taking in the review. Here again is the quote as it should have appeared: "What is more likely, unhappily, is that reasoned suggestions — from many sources — will be drowned out in the din of mindless antitax soundbites." I had omitted the "from many sources" part of the quote.

In our back and forth about this, he agrees that his review should have said "mindless antitax and protax soundbites." Now if we can only get the Times editors to start commisioning reviews of some thoughtful anti-tax books.

— Mr. Moore is a senior fellow at the Cato Institute.


TOPICS: Editorial; Government; News/Current Events
KEYWORDS: farming

1 posted on 05/02/2002 8:52:26 AM PDT by gubamyster
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Comment #2 Removed by Moderator

To: BillinDenver
This bill will very soon land on George W. Bush's desk. He will face the same agonizing decision that he faced on steel tariffs two months ago

Agonizing? he'll call ADM and ask for their advice (campaign cash)
then he'll sign it.

3 posted on 05/02/2002 9:24:22 AM PDT by WhiteGuy
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To: BillinDenver
I wouldn't worry. No way Bush will sign this massive giveaway program.

Gosh, now where have I heard that line before?
4 posted on 05/02/2002 9:24:51 AM PDT by balrog666
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Comment #5 Removed by Moderator

To: BillinDenver
Bush Says He’d Sign Farm Bill
6 posted on 05/02/2002 9:56:05 AM PDT by browardchad
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Comment #7 Removed by Moderator

Comment #8 Removed by Moderator

Comment #9 Removed by Moderator

To: gubamyster
Most of the money goes to the very farm conglomerates that small farmers are having such difficulty competing with.

End corporate welfare.

10 posted on 05/02/2002 6:55:47 PM PDT by secretagent
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To: secretagent
....a single family dairy farmer just 9 miles down the road from me took $41,000.00 of taxpayer's dollars last year so that he would NOT increase his dairy production. Is this FAIR? All farm/crop/animal subsidies should be cut to zero. Go on a supply/demand situation like most everything else.
11 posted on 05/02/2002 7:01:38 PM PDT by lkside
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To: BillinDenver
Of course he will. He's signed everything else.
12 posted on 05/02/2002 7:33:02 PM PDT by Conservative til I die
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To: lkside
All farm/crop/animal subsidies should be cut to zero. Go on a supply/demand situation like most everything else.

Bears repeating, so I will.

13 posted on 05/02/2002 8:30:19 PM PDT by secretagent
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