farm subsidies

Old MacDonald Had Friends in Washington?

That doesn’t have a great ring to it.  Sadly, the traditional image of a strong, independent American farmer – which resonated with so many people in one Super Bowl ad – has been supplanted by a dependent crop of folks who act as though their every decision is contingent upon whether Washington has signed a piece of legislation.  And high-paid lobbyists are deployed to ensure that legislation looks a certain way.

According to Sen. John Boozman (R-AR), the federally dependent farmers in his state should be pleased with a shift in leadership within the Senate Agriculture Committee that “could benefit Arkansas rice growers when lawmakers get down to crafting farm policy this year.”  Sen. Thad Chochran (R-MS) will replace Sen. Pat Roberts (R-KS) as the top Republican.  By all accounts, Boozman is right to think that Cochran will be “more sympathetic” to southern farmers.

This type of emotional appeal is lamentable, because lawmakers should not legislate based on emotion and “sympathy.”  They should legislate based on reason and fact.  The farm bill has become something that does harm to farmers, consumers, and taxpayers.  Moreover, it’s not merely a farm bill, but a farm and food stamp bill.  In fact, 79 percent of the spending in the 2012 farm bill was for food stamps and other nutrition programs.  Food stamps and farm legislation should be considered separately

Not only this, but the farm bill is comprised largely of handouts to big corporate farms.  The idea that the farm bill is there to support small farmers should be eradicated from everyone’s minds.  The farm bill actually encourages farmers to take “excessive risks at taxpayers’ expense.”  Farmers may insure up to 85 percent of their crops against damage – and they can do so thanks to crop insurance premium subsidies, which cost taxpayers $7.4 billion in 2011 and which cover, on average 62 cents on every dollar of eligible insurance purchased.

And, again, it is the larger farms that disproportionately reap these benefits:

Some of America’s largest agricultural corporations benefit the most from this handout. Premium subsidies are not subject to means tests or payment limits. Coupled with the trend toward fewer but larger farms, this has resulted in the bulk of subsidies going toward some of America’s most profitable farm businesses.

Just to be clear, we’re not being mean to the farmers.   We simply believe that they should be treated like any other business in America.  When you own a business, you take risks. Period.  And, lo and behold, there are other options for farmers besides leaning on the American taxpayer via the federal government:

Farmers already have a variety of options to mitigate agriculture risks such as natural disasters, including diversifying product lines, buying insurance at market rates, leveraging assets, and maintaining cash reserves.

By the way, consumers do not benefit from the federal government’s meddling in the agricultural sector of the economy.  “Consumers pay hundreds of millions of dollars more for milk, butter, cheese, and a variety of other dairy products because of government-imposed artificial limits on milk production.”

For many lawmakers, it feels good to dish out taxpayer money.  And it might even help them win in the next election.  But farmers don’t truly need these subsidies and other taxpayer crutches; it’s not good for taxpayers; it’s not good for the economy; and it’s not good for consumers.

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