Gauging Democratic seriousness about fiscal responsibility Posted by: McQ
on Monday, December 18, 2006
Coming up soon in the new 110th Congress will be a bill which for many small government types typifies everything that is wrong today with governmental intrusion in the market (and spending). The Farm Bill is back for passage (once every 6 years), and with it comes the probability of billions of dollars in pork, earmarks and subsidies. However, it has to get through a Democratic Congress this time which has promised, as one of it's major themes, to be more fiscally responsible than have Republicans. The agricultural industry, however, is expecting business as usual and business as usual means a pot load of money for them:
From fiscal years 2002 to 2006, the government spent $93.3 billion subsidizing "commodity crops" like corn, wheat, rice, and soybeans, flooding the international market with cheap goods. It may keep the American farm economy going, but the policy threatens free-trade agreements; World Trade Organization talks are stalled because of agriculture subsidies by the United States and equally protectionist European nations. Another chief complaint: Seventy-two percent of the money goes to just 10 percent of the recipients. "The big guys get bigger ... the small operators are left behind," says Ken Cook of the Environmental Working Group.
While Big Ag is pushing for another barnburner, the largess of the 2002 farm bill, penned at a time of government surplus, is gone. This time, nothing will come easy.
Don't bet on that. Rooted in the Great Depression, this bill has turned from a temporary helping hand to an entitlement as far as agricultural producers are concerned. And for the most part, Congress has gone along with them, except for a brief 4 years of reform when Sen. Lugar managed to pass some cuts in subsidies. By 2002, though, it was business as usual, and there's nothing on the horizon to suggest business as usual won't continue under a Democratic Congress, despite their promises:
Fruit and vegetable growers are demanding their slice of the pie as they face stiffening competition from imports. They have the backing of the powerful California delegation in Congress and have already submitted their own.
And the head of the Democratic California delegation?
Forget all of that, because last week George W. Bush signed a farm bill that increased farm subsidies by 80 percent. That's $180 billion over the next 10 years for some 2 million farmers. "It helps America's farmers," Bush said. "And therefore it helps America."
Keep an eye on this bill. We'll see how really committed to fiscal responsibility the Democrats are, given their pre-election rhetoric. If you want a bellwether for that particular issue, this bill could very well provide just that, and very quickly at that.
I did a huge expose on this horror a while back on my blog. The actual number(cost) for total subsidies and tariffs for the Agriculture industry is close to 200 billion a year.
Obviously this does great harm to the taxpayer and consumer, but unnoticed by many is its impact on the rest of the world. Why are so many Mexicans fleeing into the USA for jobs? partly because we and the Euros dump subsidized Agricultural products into the world market an have killed part of their agriculture industry. Same goes for all the poor nations in Africa with failed economies which we then spend more money trying to help them out.
As a self-proclaimed libertarian (is there any other sort?), I’ve struggled with this one over the years. I want to be laissez-faire with the farm industry just as I would any industry. But it’s in my interest, and in the interest of our nation to have a vibrant non-centralized food production capacity.
In what ways should we change our government’s approach to this national security interest? I know some may scoff at the idea of food policy as a national security issue, but what could be more important to the survival of our nation than our capacity to produce food (other than sometimes the military) ?
I look forward to any suggestions, sorry if this is a threadjack.
New Zealand ditched most of its agricultural protectionism some years back, removed all subsidies, and—wouldn’t you know it?—they still have a vibrant agriculture industry.
Google it. -=-=-=-=- Anyway, I doubt that we’re ever going to be blockaded or otherwise rendered unable to import food from countries that have a comparative advantage in various agricultural products. In the meantime, American consumers could enjoy some substantial savings, helping out poorer countries and helping ourselves at the same time.
In fact, by importing from a larger variety of suppliers as well as keeping around any local production that is viable, you may diversify your risk to the food supply. Note also this is how we now get year round produce...apples grown all over the world to make sure we can have them 24/7.
Old Mary Jane is racking up huge dollars compared to corn or wheat, with no subsidies.
U.S. growers produce nearly $35 billion worth of marijuana annually, making the illegal drug the country’s largest cash crop, bigger than corn and wheat combined, an advocate of medical marijuana use said in a study released Monday....
By comparison, the United States produced an average of nearly $23.3 billion worth of corn annually from 2003 to 2005, $17.6 billion worth of soybeans, $12.2 billion worth of hay, nearly $11.1 billion worth of vegetables and $7.4 billion worth of wheat, the report said.
Imagine the tax dollars we WOULDN’T be paying if we could eliminate the billions we spend to keep people in jail for this nonsense, and the billions we spend on the war on drugs, and the billions we lose in tax revenue.
Ok, I’ll admit it, I just want to get more tax revenues from Billy Beck;-)