Farm Bill 2013: A Republican Bill That Makes Conservatives Cringe
The House of Representatives' proposed Farm Bill will not pass the Senate. But when the drama subsides, a similarly egregious bill will be pushed through. America should focus on this inevitable outcome.
Usually, the U.S. Farm Bill sleepily slides through Congress without any objections, but this year it has faced a flood of setbacks. After the original bill's embarrassing failure in the House last month, Republicans split up the omnibus bill. In summary, they will be addressing SNAP (the food-stamps program) and agriculture subsidies in two individual bills.
But Heritage Action found that the proposed House Farm Bill expands the crop insurance programs already offered to U.S. agriculture. The Republican Party of “small government” not only supports, but proposed a bill that increases this lavish spending. On the other hand, the Obama administration has indicated support of cuts to these programs.
This is disappointing, to say the least. But when you step back and look at the big picture, this isn't surprising. At all. Yes, the adjustments are frustrating and misguided, but the Republican Party has been drumming to this beat for decades.
Farmers are doing pretty well. According to the USDA, the median farming household makes upwards of $80,000 a year (although the same report shows that these figures are heavily dependent on non-farm income). This graph shows that the average farming household is more wealthy than the average household. It has been that way for a while.
The farm bill subsidies have plenty to do with this.
Farmers no longer make up 25% of the population (as they did in the 1930s). The U.S. regularly hands over $20 billion in subsidies to a tiny percentage of the American population. The majority of subsidies nurture agribusiness, or farms that make over $200,000 annually. In fact, 10% of farms picked up 75% of the subsidies.
The farm bill oozes crony capitalism.
Farming is not as risky an enterprise as you might think. The theory behind subsidies is that farmers need extra, extra protection in order to secure our food. But according to Vincent Smith, 0.5% of farms fail per year, while 7% of businesses do.
In addition, Brien M. Riedl found that subsidies drive younger farmers out of business by inflating the price of land, do not contribute to stabilization of prices, and encourage overproduction. Documentaries like King Corn demonstrate how subsidies encourage our novel corn obsession (which is worse than it sounds).
This loathsome specimen is similar to laws fought in 19th-century Britain — the notorious Corn Laws. Although the Corn Laws were tariffs, not subsidies, they had the same goal in mind. They resulted from a special reverence reserved for farmers. Politicians sought to protect them, without considering the plight of other industries.
But they were repealed. Although low-performing farmers were forced out of the agriculture sector, the poor were finally able to purchase bread at lower prices. Cheap imports flooded the country and the economy flourished.
Richard Cobden responded to these myths in a speech against the Corn Laws:
“Why do you look at this monopoly of corn with such complacency? Simply because you and I and the rest of us have a superstitious reverence for the owners of those sluggish acres, and have a very small respect for ourselves and our own vocation. I say the Corn-Law monopolists, who arrogate to themselves power in the House of Commons, are practicing an injustice on every other species of capitalists.”
Perhaps we should be just as outraged as Mr. Cobden was.