Ronald Reagan once said, “Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” Today, the latter portion of this quote doesn’t hold true. Our government has resorted to subsidizing any industry strictly in the hopes of gaining political capital. Currently, Congress is chalking up another bill consisting of bloated farm subsidies for an agriculture industry that has been coddled since the Great Depression. Our legislature seems to believe that food might go out of style.
This upcoming bill, if passed, could cost us $300 billion over the next five years, allowing farmers who earn up to $900,000 a year to collect government remunerations. President Bush, being the fiscal conservative we know he’s not, has made a more modest proposal declaring that those who earn $200,000 or more should not receive money from tax-payers. That’s stupid, for lack of a better word. Why are we compensating individuals who make salaries most dream of? Better question: Why are we subsidizing an industry that represents America’s 19th century economy and is currently making record profits?
As usual, there’s lots of talk going on in Washington. No politician has a problem denouncing subsidies for “Big Oil” companies, but when it comes to subsidies for farmers, D.C. becomes eerily quiet. Politicians know these farming subsidies don’t go to the little guy who tries to make a living on a small farm. No, the fact is that 60 percent of American farmers get no subsidies at all, and 47 percent of commodity payments go to large farms with average household incomes of $135,000. Most farm subsidy payments are based on acreage, so by definition, the healthy agribusinesses receive the largest appropriations. Consequently, commercial farmers – who report an average income of $200,000 and net worth of nearly $2 million – now collect the majority of government compensation checks.
Synonymous with subsidies is corruption, inefficiencies and complete and utter government incompetence. First the corruption: Members of Congress who vote on farm legislation have received subsidies, such as Sen. Charles Grassly (R- Iowa, $225,041) and Rep. John Salazar (D-Colo., $161,084). Payment limits exist but the most ignorant of lawyers can find legal loopholes to exploit these restrictions. Makes you wonder why our lawmakers aren’t required to have studied law. Inefficiencies: The federal government has paid at least $1.3 billion in subsidies for “rice and other crops” since 2000 to individuals who do no farming at all. Finally the incompetence: A federal report showed that $1.1 billion was paid by the federal government to 172,801 dead people between 1999 and 2005. To put that wasted money into perspective, we could have given every homeless person in Lane County more than $500,000.
One good thing about having only senators in the presidential race is that we can easily compare their voting records. Barack Obama, who doesn’t only tell us what we want to hear but what we need to hear, doesn’t say anything in regards to farm subsidies. Obama has not voted on three of the last four bills relating to this subject. Hillary Clinton, always chomping at the bit to vote against oil subsidies, has been absent for half of the major agricultural bills over the past six years. Pretty much the only thing John McCain understands about economics is that subsidies are bad. I give the guy credit as he said this in Iowa of all places concerning the current bill in Congress, “I do not support it. I would veto it. I would do that because I believe subsidies are not necessary.” That’s the straightest talk I’ve ever heard from a politician. Though I still don’t believe anything he says.
Isn’t America supposed to be about competition and free trade? I mean, we propose this ludicrous idea of ethanol and don’t even have the tools or understanding of how to get the job done. Since ethanol started to take hold in this country I have been screaming at the top of my lungs that if we’re going to commit to this dumb concept the least we could do is open our trade doors with Africa. That continent has been begging us to allow its impressive range of crops – including almost every kind of food crop, as well as fibers, medicinal herbs and components of cosmetic fragrances – to compete with ours. There hasn’t been a major political player that has listened, effectively reveling our deep hypocrisy when it comes to free trade. “These subsidies are crippling Africa’s chance to export its way out of poverty,” said James Wolfensohn, former World Bank president. Mark Malloch Brown, the head of the United Nations Development Program, estimates that farm subsidies cost poor countries about $50 billion a year in lost agricultural exports. By coincidence, that’s about the same as the total of rich countries’ aid to poor countries, kind of a way to make us feel good about ourselves.
I don’t understand how we let farm subsidies get out of control. By the way, when I say farm subsidies I am not talking about all sorts of farms. Ninety percent of all farm subsidies are linked to just five crops – wheat, cotton, corn, soybeans and rice. Producers of fruits, vegetables, beef and poultry receive almost no government funding. Yet they earn sound incomes, and supermarkets are filled with their products.
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