Saturday, July 28, 2007

Rain On The Scarecrow

So, how many people thought that the new Congress would be more friendly to the idea of making our farm subsidy program less expensive and/or insane? Anyone who had their hand raised, bring it down now:
The House yesterday passed a far-reaching new farm bill that preserves the existing system of subsidies for commercial farmers and adds billions of dollars for conservation, nutrition and new agricultural sectors.

For fuck's sake, Pelosi, you couldn't find the will to unite the libertarian Republicans with the reformist Democrats and kick the corporate welfare that is our farm subsidy program in the nuts? For a taste of how insidious this subsidy program is, try this on for size:
The House bill includes a new concession for cane and beet sugar producers, ensuring that they will not have to cut back on their planting when unrestricted Mexican sugar imports start next year under NAFTA. The Department of Agriculture will be required to buy up volumes of sugar comparable to the imports and sell it to ethanol plants for a reduced price, at a 10-year cost to taxpayers of $1.4 billion.

Sure, $140 million a year is chump change for Congress, but did the big corporations in the sugar industry really need the extra help? You know most of this isn't going to the struggling family farmer... and in the end, it seems to me that propping up unprofitable big-box farms is just going to flood the market with sugar no one wants to buy, driving down prices and screwing over the little farmer even harder (not to mention the other farmers in the NAFTA zone that will go under).

I could go on about the direct payments to corn, soybean, wheat, cotton, and rice growers at the expense of all the other crops we could be growing, decreasing crop diversity and fucking up the pricing system. Or how the bill apparently fails to close the loophole whereby farm subsidies go to people who don't even farm. Or how 90-odd percent of these subsidies go to massive agriculture conglomerates like ConAgra and not to the small independent farmer who might actually have some sort of legitimate claim on the assistance. But I'm sure Heritage and Cato and whoever will come out and go on this rant soon enough (if they haven't already - and incidentally, this is probably the only non-platitude issue I agree with Heritage on).

Whatever. At least increased funding for food stamps came out of it, and a couple of tax loopholes got closed. I don't know if I was seriously expecting meaningful subsidy reform out of Congress, and I don't think I ever will unless Jeff Flake or Ron Paul becomes Speaker - and what are the odds of that happening? It's still disappointing, though. I at least thought the momentum was there to make some sort of dent in the system. Maybe the Senate can make some headway here, though with the Senate's necessarily more rural makeup, that's far from likely.

Hilarity of the week: House Agriculture Committee Chairman Collin Peterson (D), one of the prime pushers of this legislation, said he opposed cutting subsidies because he didn't want to help big business (the Chamber of Commerce wanted a subsidy cut so they could get a manufacturer-backed trade deal through faster). Good thinkin' there, Collin. You don't want to help big business, so you subsidize the shit out of massive corporate farms.

(And given the big sugar giveaway, is anyone surprised that Peterson received big money from Minnesota sugar producers? Archer Daniels Midland also cut Peterson's campaign a $4000 check - its third largest contribution to a House member.)


Pierce said...

We should just increase the sugar content in American foods. Problem solved.

Jeez, Jeff. Learn to think outside the box.

Jacob said...

Mmmm, sugar burgers...

And yeah, Cato's going to be all over this.

Lindi said...

Couldn't have stated it better.

Just a question...does anyone know how much ConAgra spends on political donations?

Jeff said...

Lin - ConAgra stopped giving absurd amounts when McCain-Feingold went through - they used to give scads of soft money, but obviously can't do that anymore. They give mostly to the big muckety-mucks like Hastert and Peterson now. Check for a lot of interesting financial info...

Matthew B. Novak said...

Just to stoke the fire here a little...

But what about the small family farmer who needs those subsidies?

Jeff said...

Small family farmers rarely see those subsidies - instead, the lion's share go to ConAgra and Archer Daniels Midland and that ilk. The family farmer is probably hurt more than helped by the subsidy program as a whole, since it causes overproduction and price crashes.

I would probably support a government-supported price guarantee that kicked in whenever the produce was sold (not at the year's lowest price as it is currently). The family farmer is a little bit more vulnerable than the corporate farmer, who can withstand a couple of bad years without any worries.

But in a greater sense, why should my tax dollars go to keeping someone in a business if it's losing money? More to the point, if I start a (non-farming) business and it loses money, can the government pay me to keep running it? If we're going to pay people to keep operating unprofitable farms, then it seems only fair.

Jeff said...

Just to clarify the price support part of the last comment a bit: farmers can currently claim price support if the cost of their produce dips below a certain level, even if they wait until later, when the price has recovered, to actually sell.

For example: a farmer grows wheat. Say the price guarantee is $0.10/bushel. If the price dropped to $0.08/bushel in October, the farmer could still claim $0.02/bushel from the government even if the grain gets sold in December at $0.14/bushel. The only thing worse than subsidizing a failing business is subsidizing a profitable one.

Matthew B. Novak said...

What about a subsidy that only goes to individuals who farm on an acreage below a set limit, (so as to not subsidize the factory fams) who don't sell through one of the big co-op types?

Also, I don't think farming is easily compared to any other business, since there are significant forces at play outside of supply/demand/efficiency. If you start a non-farming business and it loses money that's either because your a bad business man or there's not really a demand for your product. The same can't be said of farmers. There's an essentially unlimited demand for food, and even the best run farms can be subject to drought/flooding/pests, etc. Complete non-business/non-market factors that determine whether or not they can even keep themselves afloat.

Oh, and there's the whole "Americana" thing too. I've been around family farms for much of my life, and there's really something to that argument. It's hard to qualify, but family farms are important to our identity.