Over the Dairy Cliff: How Farm Welfare Harms Consumers

Writing in today’s Wall Street Journal, James Bovard highlights the absurdity of U.S. agricultural policy:

Current farm programs—which consist of massive subsides, price supports and various marketing restrictions—were enacted in 2008 and expire on Dec. 31. That should be cause for rejoicing, except that the system is rigged against consumers and taxpayers.

Instead of Americans enjoying a bounty after the clock runs out, federal farm policy will automatically revert to a farm bill drawn up in 1949. That will compel the Department of Agriculture to roughly double the price supports for dairy and other farm products thanks to a mystical doctrine called "parity."

The doctrine was concocted by Department of Agriculture economists in the 1920s to "prove" that farmers were entitled to higher prices than the market provided. The official parity calculation was based on the ratio of farm prices to nonfarm prices between 1910 and 1914, the most prosperous non-wartime years for farmers in American history....

The ultimate absurdity of the "dairy cliff" is that there is no need for federal intervention in dairy markets. The supply and demand for the vast majority of food products made in America function just fine without government price controls. The worst disruptions have perennially occurred for a handful of items such as sugar and corn, as well as dairy products, which are under political protection. Politicians have long exploited these disruptions to help drum up donations to their re-election campaigns.

Read the whole thing here.

In a recent column for Reason.com, Baylen Linnekin made the case for scrapping the farm bill and replacing it with nothing at all. In a recent column of my own, I explained how the Supreme Court’s excessive deference to economic regulation has its roots in a protectionist New Deal law passed to benefit America’s dairy industry.

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • Doctor Whom||

    Affordable food is a sign of market failure; therefore, government must step in and do something. All right-thinking people understand this. I remember as a poor, starving graduate student, watching the cost of staples double overnight because FYTW.

  • Fist of Etiquette||

    If only there had been a candidate who understood the lack of need for a Department of Agriculture.

  • The Late P Brooks||

    That darn Booooooosh!

  • VG Zaytsev||

    The doctrine was concocted by Department of Agriculture economists in the 1920s to "prove" that farmers were entitled to higher prices than the market provided.

    That's unpossible. Everyone knows that the 1920s were a time of libertopia and runaway laissez faire.

  • Gilbert Martin||

    "That's unpossible. Everyone knows that the 1920s were a time of libertopia and runaway laissez faire."

    Yep.

    And of course, federal reserve monetary policy had absolutely nothing to do with with precipitating the stock market crash of 1929.

    Nothing at all.

  • cavalier973||

    I would love watching the consequences of bad policies being visited upon those who voted for them were I not forced to suffer those same consequences.

  • Gilbert Martin||

    They wouldn't learn anything even if that were possible.

    They would continue to concoct rationalizations as to how a LACK of sufficient government regulations were the cause of it all.

  • cavalier973||

    Of course; but I'm enough of a misanthropist to actually enjoy watching the spectacle of contemptible buffoons going around poking themselves in the eyes.

  • Raston Bot||

    I imagine $7 gallon milk would shut down cell towers as millions of new mothers called their congresscritters at the same time to ream them out.

  • R C Dean||

    I doubt they'd care that much. Its all on the food stamp card anyway.

  • Doctor Whom||

    The sheeple-herders would just blame the free market and call for more government regulation.

  • mad libertarian guy||

    In our house, our 2 boys and my wife go through about 3.5 gallons of milk per week. If my milk bill goes to over $100 per month, shit's gonna hit the fuckin' fan.

  • Canman||

    PJ O'Rourke long ago said about a farm bill: "The best thing to do is take it out behind the barn and shoot it."

  • Brutus||

    I think he said, "kill it with an axe." I like that even more.

  • ||

    alt txt:

    For being a bastard with no manners. Without a dook of an idea about how to comport yourself public-wise, O my brother.

  • Tulpa (LAOL-PA)||

    The bizarre thing is that this -- and all the other purported catastrophes -- could be averted by a separate act of Congress...and they still don't want to do it. The parity pricing thing isn't some constitutional amendment, it's a law like any other.

  • Pope Jimbo||

    Bizarre? How about infuriating? All the reporting on this that I have heard never includes the idea that maybe they just rescind the original law.

    Nope. The options are extend for a year, extend for multiple years or come up with a 5 year plan.

    Never does the idea that just removing the first idiot law pop into their brain housing group.

  • mad libertarian guy||

    Because repeal = failure, and they can't have anyone thinking that anything the benevolent government ever does is a failure.

  • Brian from Texas||

    Yarbles! Great, bolshy yarblockos to you!!

  • Robert||

    And it's not just Congress. Some states and most other countries subsidize dairy heavily. I think it might've been Bovard himself who wrote, "The world is awash in butter" in the form of gov't stockpiles.

GET REASON MAGAZINE

Get Reason's print or digital edition before it’s posted online

  • Video Game Nation: How gaming is making America freer – and more fun.
  • Matt Welch: How the left turned against free speech.
  • Nothing Left to Cut? Congress can’t live within their means.
  • And much more.

SUBSCRIBE

advertisement