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July, 19th 2007

The new Farm Bill: pretty crap, in the grand scheme of things

– Liz Mair

I returned from New York last night to see that the Democrats have crafted their new Farm Bill. Surprise, surprise, it looks pretty crap, overall.

The main thing that stands out to me about this bill-- and probably the thing that I instinctively am inclined to hate the most about it-- is its establishment of a ceiling of a very high $1 million in gross income, which, if exceeded, means a cut-off of subsidies. The administration had wanted a ceiling of $200,000, a much more sensible number. Does anyone else find it interesting that by setting the ceiling for cutoff of subsidy payments so high, not only are Democrats wasting more federal money on market-distorting and third-world-development-killing subsidies, but they're also giving a nice fat payout to farmers who are comparably rich? Democrats like to brand themselves as the party of the little guy, not big business. Clearly, with this bill, they're demonstrating that that's bull-- pure and simple.

I would say that giving what is effectively welfare to farmers earning $1 million is the equivalent of actually, physically cutting welfare checks to, say, corporate lawyers bringing in $1 million through their work, and paying for it all out of the federal budget. And we don't do that because we recognize that, hey, if you're making $1 million a year from your business, you actually don't need a government handout to survive: that poor person living on the street with no job and no housing clearly does, but you, you're a corporate lawyer earning loads of money, so no, you don't need government assistance.

I expect the people at dailykos to run the argument that the Bush tax cuts are the same thing as cutting the rich corporate lawyer a subsidy check, and so this is all fine and dandy, because it's consistent with what have been recognized as conservative economic principles. Except that this is vastly different. There is a huge difference between taking everyone's money, in greater proportion to begin with, and then giving vast sums out to wealthy people who don't need it, as well as poor people who do, and just taking less money from people in the first place-- and then paying money out to the poorest of the poor who unfortunately do require a safety net. The former is just what Democrats appear to be doing, the latter is closer to the Bush approach (though certainly the 2002 Farm Bill benefited rich farmers).

This new Farm Bill looks crap to me not just because it's unnecessarily (and yes, I'll go so far as to say unconscionably) providing corporate welfare to wealthy farmers who don't need it, but it's also bad because it contains nice little increases in subsidies which, frankly, we can't pay for without either expanding the deficit or hiking taxes, at this point. Under pressure from what I'm guessing was the California delegation, Collin Peterson, the man responsible for the bill, went ahead and added in $1.8 billion in new federal grants to those growing vegetables and fruits.

Clearly, not only do Democrats not care one whit about fiscal restraint (everywhere you look, there's a spending proposal increased by a massive sum, even in the realm of abstinence education funding, which Democrats increased this year on a level not even seen or suggested when Republicans were in the majority). They also don't understand that subsidies just aren't a good thing, in general. Not only do subsidies distort the market, making prices of basic consumer goods far higher than they otherwise would be, and determining which goods are winners and which ones losers based on an artificial assessment of value by government, they also have the effect of making it harder for producers in the Third World to export their goods to the US, and sell them here at any kind of a profit. This is no good thing in the context of ending global poverty, and increasing development. Ultimately, despite the Democratic Party's apparent appeal with donors to groups like Oxfam, their elected officials seem perfectly happy to go ahead and screw over farmers and producers in the Third World, all in an effort to buoy up domestic producers and presumably-- given that the bulk of funds under the new bill are headed to about 20 congressional districts, many in the Midwest, where the Democrats made big gains in 2006-- deliver more Democratic votes.

There are other things that are wrong with this bill, to be sure, but as it stands, the major criticisms of it have to be that it continues the pattern of corporate welfare for wealthy farmers, it costs too much, and it's protectionist and anti-development.


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