Democrats & Liberals Archives

Squash the Farm Bill

The farm bill is a perennial staple of Congress. The House Agricultural Committee, on which sit representatives from farm states, comes up with what is called a Farm Bill. It’s real name should be the Rich-Farmer Welfare Program. When the Farm Bill is announced, Democratic and Republican arguments disappear. We are left with pro-farm-welfare vs. con-farm-welfare.

Today they are considering a $90 billion giveaway program. This is not for every farmer. No, it is available only for farmers of row crops such as corn, wheat, cotton and soybeans. If you are lucky enough to be doing this, you get free money. Congresspeople want to increase the old payment of about $40,000 to $60,000.

I'm unhappy to say that Nancy Pelosi calls this:

a first step toward reform.

Why? Perhaps she says this because the bill reduces millionaire eligibility: Before the cut-off point was $2.5 million in yearly earnings. The new limit is $1 million.

This is reform? Giving a subsidy to millionaires? Reform means getting rid of this $90 billion boondoggle. I offer 3 simple reasons:

  • Its Unfair - Not all millionaires are treated equally. Farmers working on other crops are left out

  • The Richer You Are the More You Get - Those with the biggest farms make out the best

  • Free Trade Suffers - It's these subsidies that prevent us from having true free-trade agreements with poor countries who cannot sell their crops because of this farm subsidy

We can put $90 billion to better use. Squash the Farm Bill.

Posted by Paul Siegel at July 25, 2007 8:30 PM
Comments
Comment #227405

Paul, you’ve done a great job of acknowledging and diagnosing some of the absurdities that arise when the government steps in and starts meddling with the economy. You should go over to the Third Party blog and share your findings with those in a current thread who believe that government-managed economies are a terrific idea and that we need more, not less, of the government’s “wisdom” applied in these areas.

One of the absurdities of the corn, soybean, wheat, and cotton subsidies is that they provide farmers with an incentive to plant far more of these crops than the market requires. And what do these excessive crop-yields result in? Why, it depresses the prices of these commodities. And what does lower prices result in? Why, the impossibility of turning a profit when you grow these crops, which in turn requires more government subsidies. It’s a vicious cycle. Or rather, a downward spiral. The more the government gets involved, the more they have to get involved in order to maintain the corrupt and idiotic status quo that they themselves have created.

Posted by: Loyal Opposition at July 25, 2007 11:03 PM
Comment #227407

Paul,

I’m curious if you realize that the Food Stamp program, and School Nutrition program, among other nutrition programs are a very large part of the “farm bill”? Should we just shift all of these to “faith based” initiatives?

I’d also argue that without some form of farm subsidies we’d see a consolidation of corporate farming comparable to what we see now with America’s oil companies. Just what we need …… “farm cartels”!

Posted by: KansasDem at July 25, 2007 11:46 PM
Comment #227410

Paul
Excellent. I just graduated from a far-right wing high school. Many if not most of the students were in some way connected to agriculture. They all hated welfare programs…until you start mentioning government welfare for farms and dairies. Giving money to the poor? bah-humbug, they say. But touch welfare to parents who buy their kids brand-new cell phones and “pimped out” trucks and SUVs and you’ll start a rebellion. Interesting.

Posted by: Silima at July 26, 2007 12:07 AM
Comment #227417
One of the absurdities of the…subsidies is that they provide farmers with an incentive to plant far more of these crops than the market requires…depresses the prices…in turn requires more government subsidies.

Interesting. That was the reasoning behind subsidizing farmers NOT to grow crops. You Republicans got rid of those subsidies in the 90s and replaced them with the system we have today.

In fact, Republicans were all set to endorse this bill until Democrcats amended it to pay for nutrition programs by penalizing tax-dodging corporations that use offshore tax shelters.

Posted by: American Pundit at July 26, 2007 12:47 AM
Comment #227420

Paul
Kansas is right. Look into it a bit more.

LO and others

I read a piece yesterday that ties into Pauls last point about “free trade” and immigration. Seems farmers ,a very conservative lot,in California are hopping mad that there was no progress in immigration made. They are facing severe labor shortages. What is going on is that the immigrants,mostly undocumented,that usually work for them at about 7 $ an hour are finding other work at 14$ an hour in construction etc. My first reaction was a big,”Screw them,let them pay 14$ an hour,” but then the article went on to explain that for them to do that they would have to raise the price of produce beyond what the market would support because of low priced imports.Sure they could cut their own profit margins but only to an extaent. No business can operate at a loss for long and the preassure to sell their land for developement is already strong.They do not want to break the law by hireing undocumented workers. They also resent that so far there is no real way to certify the legality of their workforce,promised in the failed immigration bill. The farmers are a powerful group and this must be resolved. Increased globalization of agriculture will lead to increased immigration legally or illegally.

Another downside to agricultural “free trade” is it can and does cause landowners in exporting countries to produce higher value crops like coffee and roses for export and not grow needed food for the populations of their own countries. This is not a problem in a country with enough to eat but has caused starvation in more than one case,Ireland for example was exporting beef under military escort during the Potato Famine.

Posted by: BillS at July 26, 2007 1:04 AM
Comment #227436

Paul — Great article, we need to get rid of these subsidies to farmers.

Bill — If you really think about it, when an exporting country shifts from producing staple food produce (potatoes, wheat, vegetables, etc.) to more valuable products (coffee, roses, etc.) this only increases their net income and allows them to consume more of the staple foods than before by buying them on the world market. However this is not possible if we inflate our agricultural prices through export subsidies here at home. Trade theory says (and the historical evidence shows) that specialization on behalf of countries leads to higher net incomes and thus higher consumption overall. Forcing a developing country to attempt to develop industrially and otherwise while still using a large portion of its labor force to produce the food they need to survive, when the food could be bought cheaper on a free world market, is neither effective nor fair.

KansasDem — Your support for agricultural subsidies is irrational, at least so far as you explain it here. “I’ll vote for subsidies because welfare programs are on the same bill.” That’s really going to make effective change for our country. Why don’t we just have every possible legislation inserted into one yearly bill and then take a simple Yes/No vote? That will make everyone’s life easier, and stop all the confusion of having thousands of bills every year. Next thing I know, my congressman will explain his support for the war as such: “I voted for the war because the funding for the new bridge in our town was on the same bill.”

Posted by: Ryan at July 26, 2007 9:52 AM
Comment #227441

1.2 billion given to dead farmers over the past few years. Nuff Said.

Posted by: Rhinehold at July 26, 2007 10:38 AM
Comment #227444

Ryan
Unfortunately the “net income” increases you speak of often only go to the large landowners. The landless,the vast majority,benefit only marginally if at all.Were income more equitably distributed you would be correct but that is historically not the case in many countries,especially those suffering from the colonial legacy of land distribution.

Posted by: BillS at July 26, 2007 12:30 PM
Comment #227447

“Your support for agricultural subsidies is irrational”

Ryan,

My point is “fix it”, don’t just trash it! As Rhinehold points out there is rampant abuse of farm subsidies, as there is of any program created by man. Penalties, especially financial penalties, for such abuse should be extremely severe!

The house version of this bill ain’t goin’ nowhere anyway. The Senate overwhelmingly hates it and Bush would veto it. Will the final bill be perfect? NO! Expecting perfection out of negotiations between more than 500 politicians (and how many lobbyists?) is a “pipe dream”.

My concern with nutrition programs is that they’d never get passed in a “stand alone” bill.

Posted by: KansasDem at July 26, 2007 1:48 PM
Comment #227460

NPR just did a report on this this morning and said that something like 85% of these funds go to corporate farms. These are funds that could be used to help family farms and pay for programs to help feed the poor. But again we are providing corporate welfare.

Posted by: Carolina at July 26, 2007 3:58 PM
Comment #227464

“But again we are providing corporate welfare”

Almost makes one believe govt should only run govt.

Posted by: kctim at July 26, 2007 4:11 PM
Comment #227465

Good catch, Caroline. I heard Tom Harking say yesterday that he tried to change that in 2002 and again this year, but Republicans blocked it.

Posted by: American Pundit at July 26, 2007 4:11 PM
Comment #227466

BTW Paul, I like the pun. “Squash” the Farm Bill. Good one. :)

Posted by: American Pundit at July 26, 2007 4:13 PM
Comment #227469

All

A look at the agricultural industry in this country shows clearly that the reasons it has become not only the breadbasket for the nation and much of the world but also our greatest economic powerhouse include price stabilization(ie.subsidies) and protectionism.There is always room for improvement and this bill does make some but to throw out subsidies and open furthur US ag markets to slave labor/enviormentally unsound competition from abroad will kill the golden goose.
The Rep flip flop on this,as AP pointed out, has to do with offshore corporate tax collection and the requirement for prevailing wages on alcohol facilities construction.Fine. They continue helping us turn the farm belt purple if not blue. Reps only seem to be upset about subsidies to industries that actually produce something useful. They love subsidies to defense contractors and insurance companies.

Posted by: BillS at July 26, 2007 5:57 PM
Comment #227470

Ryan
A bit more info. The new figures for the Philippines shows that 15-18 % of people there are hungry. Hunger is defined as having involuntarily missed eating at least once during the last 3 months. A major Philippine ag export is tobacco.

Posted by: BillS at July 26, 2007 6:04 PM
Comment #227476

Is this the same bill that is going to authorize ethanol plants to be built using Davis bacon wage rates?

Posted by: j2t2 at July 26, 2007 7:41 PM
Comment #227477

j2t2
Thats what I read today,in the NYT I think. One more reason for the Reps to flipflop. Good. The farm states have been red for far too long.Looks to my that Pelosi found Roves playbook. BTW Davis and Bacon were both Reps back in the day when Reps actually cared about working people.

Posted by: BillS at July 26, 2007 8:22 PM
Comment #227482

BillS the Heritage Foundation has a You Tube blurb on the issue. They of course are against the bill because the Davis Bacon wages will increase the cost of fuel forever due to the higher construction costs.

Posted by: j2t2 at July 26, 2007 9:59 PM
Comment #227515

j2t2

So the Heritage Foundation is going to hang their bogus arguement on prevailing rate protections. Pretty weak but no surprise.In their eyes anything that protects workers must be all bad so it seems like a good arguement to them.I suspect the real reason they are against the bill was that they were told to be and opposing it to protect offshored corporations from taxes is a tough sell,even for them.

I should note here that Davis/Bacon wages are cheaper in the long run and often in the short run as well.States that have dropped there use have all lost money doing so.The original intent of the law was to keep the projects of the federal government,as such a big construction user,from adversly effecting the wages in any given regional constuction market. They do that and more. They also help insure professional,quality work and force management to constantly seek better methods.You get what you pay for.

Posted by: BillS at July 27, 2007 1:59 AM
Comment #227520

LO- I suspect that many folks would love to have the
the good old days of the Robber Barron’s, but
it ain’t gonna happen!

Posted by: -DAVID- at July 27, 2007 3:19 AM
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