Farm Subsidies

Congress Takes Steps to Renew Farm Bill Boondoggle

Taxpayers be warned.

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Corn
grongar via Foter.com / CC BY

It's Farm Bill time again. And that's too bad.

Perhaps wary of the fact that it took years to pass the most recent Farm Bill in 2014, Congress has already moved to begin deliberations over the next five-year bill, which would likely become law in 2018. The U.S. Senate Agriculture Committee will hold its first hearing on the upcoming Farm Bill in Kansas later this month.

The Farm Bill is perhaps best known for handing billions of dollars of taxpayer money to a small number of the shrinking percentage of Americans who farm. Pres. Franklin Roosevelt's agriculture Henry Wallace pitched payments to farmers during the Great Depression as "a temporary solution to deal with an emergency." The emergency—the Depression—ended around the same year that my grandparents went to prom. But the subsidies remain. In fact, they've only mushroomed in the decades since their adoption.

In the most recent version of the bill, which took effect in 2014, Congress voted to subsidize farmers' purchase of crop insurance. In earlier versions, Congress had forced taxpayers to prop up farmers largely through direct payments.

The move to subsidized crop insurance was supposed to save taxpayers money. But, as I detail in my recent book, Biting the Hands that Feed Us, it's had the opposite effect.

During the most recent debates over passage of a Farm Bill, Sen. Thad Cochran (R-MS) urged support for crop insurance, which he referred to as a set of "important risk management tools for farmers and ranchers nationwide" that "can help reduce costs." Sen. Debbie Stabenow (D-MI), who chaired the Senate Agriculture Committee, of which Sen. Cochran is also a member, lauded the Farm Bill as "an opportunity to cut spending." That's not how it's worked out. Rather, costs have skyrocketed under the new Farm Bill thanks to crop insurance subsidies. In 2011, before crop insurance supplanted direct subsidies, I noted in a Baltimore Sun op-ed that farm subsidies cost taxpayers approximately $15 billion per year. With crop insurance subsidies now having gained favor over direct subsidies, the latest EWG estimates show farm-subsidy payments could reach $30 billion annually by 2018. All of this was predictable. As I wrote in 2014, "the bill taxpayers may foot for crop insurance subsidies . . . may outweigh what taxpayers would have contributed in direct subsidies." So much for reducing costs.

While it's a sure bet to assume that the Farm Bill's costs to taxpayers will continue to rise, we won't know by how much until taxpayers are already on the hook. That's because even in the wake of a Farm Bill's passage, it's difficult to predict the cost of the bill over a period of years, as this recent economic analysis demonstrates.

This uncertainty over exact numbers doesn't mean the next Farm Bill will be any better than the last one. It will be worse, for several reasons. For one, Sens. Stabenow and Cochran still hold seats on the committee. Sen. Stabenow has made clear that "support" for farmers—generally, code for "subsidies"—is a precondition of her vote on the current nominee to head the USDA, the agency that doles out subsidies.

"It is imperative that the next Agriculture Secretary is ready on day one to support our nation's food producers and local communities," she said in a statement last month in the wake of Gov. Sonny Perdue's nomination to serve as secretary of the USDA under the current president.

She's got little reason to worry. Gov. Perdue, notes the Environmental Working Group—a nonprofit that's critical of farm subsides—has himself received farm subsidies.

Then there are the powerful state and national farmers unions. These groups—including the Indiana Farm Bureau, in the home state of current Vice President Mike Pence, a supporter of subsidies—are telling their members that Congress wants their input "about the type of safety net that works best for them."

What else can we expect out of the next Farm Bill? At least one writer has suggested—given Gov. Perdue hails from the South, while recent USDA heads have come from Midwestern states—that subsidies might shift from favoring popular Midwestern crops like corn and soybeans to increasingly backing Southern staples cotton and rice. Payments to the dairy industry may also rise.

I've been critical of farm subsidies for years now, arguing time and again that they should be abolished across the board. And I've got company.

Though farm subsidies find support on the political right and left, so too does principled opposition. Nobel Prize-winning New York Times columnist Paul Krugman called farm subsidies "grotesque," while the conservative Heritage Foundation says they're "so poorly designed that they actually worsen the conditions they claim to solve." The Minneapolis Star-Tribune editors called farm subsidies a "boondoggle… [that] throw[s] money at farmers, whether they need it or not."

Despite these facts, Congress is again set to double down on the boondoggle.

NEXT: Will Liberals Learn to Love the 10th Amendment?

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  1. The move to subsidized crop insurance was supposed to save taxpayers money.

    Has subsidizing any industry every brought prices down?

    1. They were subsidizing a different industry this time. Just because it didn’t work with any of the others, doesn’t mean it won’t work here!

      1. Welfare farmers
        Make better lovers!

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    2. Well it brought the price of the crop insurance down, didn’t it?

  2. If only Republicans had a majority in Congress, or even controlled the White House, crap like this would soon come to an end.

    1. If only Republicans had a majority in Congress, or even controlled the White House, crap like this would soon come to an end.

      All of the previous Republican Moments ? were misreported by the Liberal Press ?.

    2. Oh, hell, farmers have been getting special treatment since before the ink was dry on the constitution. Thomas Jefferson, of all people, thought farmers were special. No congress in living memory has been included to shut off the farm oriented gravy train. Expect Social Security to get repealed before farm subsidies.

      1. Back when Thomas Jefferson was president, the majority of people were farmers. Now it’s something like 2%.

        1. There were 2.5M people in the USA in 1776 and 2% of the current USA population of 330M makes 6.6M farmers today.

          This says in 2012 there were 3.2M farmers operating 2.1M farms.
          USDA # of farmers

    3. And my optimism about a Republican-controlled congress and fiscal restraint turns to ash my mouth.

  3. OT: just learned it’s Super Bowl weekend. Not enthused about this one, obviously.

    1. It’s easy: even if you don’t care about football, it’s an opportunity to binge eat chicken wings and drink beer.

      1. I can do that anyway

      2. It’s hard to do with a teething six-month-old on the house, or with the Falcons playing. I’m not saying Matt Ryan fucks sheep, but i think it’s fair to point out that he has never publicly stated that he doesn’t.

        1. teething six-month-old on the house

          I think I see your problem.

          1. It’s the lack of sleep, Lee.

            As an often sleep-deprived individual myself I can rather easily detect the condition in others.

        2. What do the sheep say?

          1. Sheep lie.

  4. As is the case this week, Baylen is able to make dry, but very important food policy topics extremely readable. Keep pimping your book weekly, I had completely forgotten about it. *wish list*

  5. Congress is again set to double down on the boondoggle

    Outrageous! I’m sure we’ll throw them all out at the next election.

    1. Did Congress ever do away with the mohair subsidy?

      1. There was a 2015 ‘National Review’ article discussing its continued existence, so my guess is no. Texas gets most of it, and Cornyn is a powerful Senator, so it’s unlikely to disappear any time soon.

  6. Thank you God for creating people to care about this shit. (No you are not getting my first born. I will do some corn with cojita – how does that sound?)

  7. A little Cafe Hayek this morning

    In short, this U.S. government agency (CFPB) ? which is Elizabeth Warren’s baby ? is almost completely unregulated.

    Why is it that those, such as Sen. Warren, who scream so loudly for regulation want as little possible regulation of government? In private markets, regulation is interwoven into the very fabric of those private arrangements and processes: each consumer has the freedom to decrease the spending of his or her own money here and to increase his or her spending there, all without ever having first to win the approval of other consumers; each supplier (including each worker) has the freedom not to supply his or her wares and services here and to instead supply them there; businesses are free and encouraged by market signals to expand and contract as the voluntary choices of consumers direct; entrepreneurs are free and encouraged by market signals to seek out and to seize new profit opportunities. This competitive process, while never perfect, imposes regulation on all market participants that is about as reliable, as strict, and as apolitical as can be practically achieved.

    1. And yet people such as Sen. Warren and most of her colleagues on Capitol Hill are blind to the strict regulation supplied by market processes and demand that it be overridden by unregulated government officials. The result is not better or more regulation; it is not even different regulation. The result is less regulation. Endowed with the monopoly power to dictate to others what others should do with their ? the others’ ? own money and resources, government officials exercise the very essence of unregulated (and, hence, dangerous) power. Be assured that this power will be used, not to promote the general welfare, but to promote the interests of the politically influential at the expense of the masses.

      1. Even a quick review of shameless Warren’s career will convince you that she is probably the most sociopathic thug that’s infested DC, at least in a couple of decades. Luckily she’s an unimaginative, mediocre thinker and more of a mimic than an innovator.

        1. Yea she is scary as hell being super self righteous and power hungry.

          However i think you may be right. She used to be a reagan fan and now is a far left zealot

          1. She also used to talk about plans that would involve compromise with republicans and is now devoutly TEAM BLUE.

        2. And somehow even less persuasive than Barry on selling her terrible ideas, based on my observations, at least.

          1. She just replaces any argumentation with a zeal to other true believers. She yells what people want to hear.

        3. I find the term “sociopathic thug” to be a drastic and irredeemable understatement Sir/Ma’am

  8. I remember when Bush reformed the farm subsidy situation, just like Clinton reformed welfare and Obama reformed the healthcare market. We’re all living happily ever after and yet you people still want to whine and complain just because things are worse now than before they were fixed. Quit complaining or they’ll fix more stuff, even harder.

    1. I remember when the market-cheerleader reaganauts were going to offer a major reform of farm policy & bigly reduce fed outlays, way back in 1984. Farm Bill of 1985 turned out to be one big pile of compromise and consensus and BS spending as usual.

      1. Eh, I do think if Reagan had ever had a friendly Congress he would have made cuts. He was a serious movement conservative, if he’d had the political power he would have followed through. But Tip O’Neill was the Speaker, and there was never going to be actual cuts made with him controlling the House.

    2. remember when Bush reformed the farm subsidy situation

      At least Bush vetoed the second one. This is easy to remember as I can count the “good” things W did on the fingers of one hand, with 1 or 2 fingers left over.

    3. I’ve got a list of people..err..stuff I would like to fix harder

  9. The Farm Bill is perhaps best known for handing billions of dollars of taxpayer money to a small number of the shrinking percentage of Americans who farm.

    No mention of Food Stamps? That is about 80% of the Farm Bill.

    1. Is it really?

    2. Is it really?

    3. Reason never mentions Food Stamps when they have their stories about the “Farm Bill” which is actually the Agriculture Department bill and as you point out is 80% Food Stamps

      1. Just like they never mention federal grants/welfare to cities unless someone threatens to cut it off. At which time city welfare is elevated to 2A status.

        1. You don’t get invited to be on MSNBC or write for Salon by badmouthing welfare or food stamps

        2. Which writers have advocated not cutting welfare, and for what reasons?

          1. Maybe you should go back to the beginning of this thread and catch up.

      2. Oops its actually changed a bit since I last saw the budget

        71% Nutritional Assistance

        16% Farm and Commodity Programs

        7% Conservation and Forestry

        6% All others, Includes Rural Development, Research, Food Safety, Marketing and Regulatory, and Departmental Management

        http://www.obpa.usda.gov/budsum/fy17budsum.pdf

        1. Damn, so the vast majority of the spending is pure transfer payments. Not mentioned in the article though.

        2. Damn, so the vast majority of the spending is pure transfer payments. Not mentioned in the article though.

            1. Sarah says it’s cool she don’t consider it cheating

        3. If most of this is food stamps then why are the ag states at the top of the list? Don’t they grow enough to share?

          1. Because the list is the actual farm aid. They don’t show where the food stamps go

        4. Dropped by nine points without a peep from the news scratchers. Wow.

    4. I thought they tried to separate the two. Did that effort fail?

  10. Here’s a list of states in order of the % of farm subsidies they recieve.

    1. District Of Columbia $231,479

      Where are D.C.’s farms? Are there some floodplain ag fields along the Potomac?

      1. I think that would be all Food Stamps.

        1. There are no poor people in D.C.?

          SNAP spending in D.C. has to be 1000 times that.

          1. (D.C. residents, annually)

      2. Did you already forget about Michelle’s White House garden?

    2. Didn’t the Farm Aid concert make a difference?

    3. Huh, AZ is more than halfway down. We have a lot of farms here so I expected to be higher. I mean, it’s still a 1.6 billion, but better than I thought.

  11. “Nobel Prize-winning New York Times columnist Paul Krugman called farm subsidies “grotesque,”

    While I agree farm subsidies need to be abolished all this proves is that the money is going to red states.

    1. I can imagine how he will reverse himself once a few sob stories are trotted out about the mean old Republicans cutting off Billy and Sarah’s Dad’s subsidy and now they can’t find the funds to enter their calf, Bessie, in the 4H Club fair that they’ve been waiting for their whole lives seeing as how Sarah is Downs Syndrome and Billy is ADHD, and Mom died fighting terrorists in Iraq, and Granpa was a member of the Greatest Generation and never had the funds to undergo the transgender surgery he was denied by the local quack doctor.

  12. Nobel Prize-winning New York Times columnist Paul Krugman called farm subsidies “grotesque,”

    If Krugman opposes them, maybe they are a good thing after all.

    Well, they probably at least serve one purpose: they keep rural voters happy, something the GOP depends on.

    1. +1 Electoral College

    2. My guess is that it disproportionately benefits red states. In recent years, Kruggie has shifted from liberal, pro-expansive-government hack to vindictive, anti-anyone conservative asshole.

      1. Though arent most of these farm subsidies food stamps?

  13. Congress has already moved to begin deliberations over the next five-year bill

    Five-year bill? Five-year plan, even? Given the unpleasant associations of that phrase, you’d think they would pick some other interval.

    1. We are announcing our new 4-year-and 364-day plan soon

  14. One minor problem…..principled and Krugnuts should never be used in the paragraph, much less the same sentence.

  15. Ag subsidies are popular worldwide.

  16. [a href=”https://youtu.be/NzoRZDAxPMA/”>”There’s more money in not growing corn.”

    1. Thank God this is an old thread so this is not aw embarrassing

      1. *throws phone*

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  19. They should make the Farm Bill chapter of Parliament of Whores required reading for all students until this bullshit finally gets killed.

    And then make How to Drive Fast on Drugs While Getting Your Wing-Wang Squeezed and Not Spill Your Drink required reading as well. I would have loved that over Nathaniel Hawthorne in HS.

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