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Socialism for American farms divides the body politic into four camps

farm_subsidy_gothic

Jonathan Chait EXPLAINS the peculiar politics involved in maintaining a program of agri-socialism:

The right-wing critique of Big Government — bloated, wasteful spending with no real purpose that imposes huge costs on the market — is basically wrong, but there’s one major piece of the government in which it’s completely right: agriculture policy. The farm sector is a vast archipelago of socialism sitting amid a free-market economy. Agri-socialism commands essentially zero intellectual support. Conservatives hate it. Liberals hate it. Experts or academics who study it tend to say things like, “It’s so astonishingly irrational, it just takes your breath away.” Agri-socialism operates largely in a self-contained world dominated by the economic interests that benefit from it. So, for instance, the “National Milk Producers Federation” can say things like, “This supply management provision is crucial to ending low milk prices,” as if maintaining high prices were a sensible public policy goal.

Basically, there is no reason at all for the government to single out farmers for special support, as opposed to any other kind of business owners. If I were looking to cut domestic spending, or even if I weren’t, farm subsidies would be the first thing to go, the most unjustifiable government program of any significant size. It’s worth noting that the budget figures don’t nearly capture the cost of agriculture subsidies, much of which come in the form of quotas and tariffs that result in higher consumer prices but don’t entail writing checks from Washington.

Unfortunately, even though congressional Republicans are looking to cut domestic spending, most of them regard agriculture subsidies as an especially meritorious program, not an especially awful one. Some of them want to cut it deeply or even do away with it, but not enough. And the main dynamic that prevents reform, and the reason the farm bill ultimately went down on the House floor today, is that the conservatives who do want to cut agriculture subsidies will only do it if they can also kick the living crap out of the poor.

Agriculture subsidies have traditionally been bundled together with food stamps, in order to create a legislative coalition. (Farmers like the fact that food stamps mean more people can buy their food.) But in recent years, conservatives have gone from tolerating food stamps to absolutely loathing them. This year, House Republicans have attached to their farm bill deep cuts in food stamps, which have grown costlier because the recession has vastly increased the number of poor, hungry Americans (and not, as many Republicans claim, because of loose eligibility standards)…

The food-stamp issue has imposed a deep partisan overlay on the agricultural issue. The House is essentially divided into four camps: (mostly rural) Democrats who want to keep spending on agriculture subsidies and food stamps, urban Democrats who like food stamps but not agriculture subsidies, Republicans who want to cut food stamps but not agriculture subsidies, and Republicans who want to cut everything. The farm bill died because the Republicans who want to cut spending on everything teamed up with the Democrats who object to cuts for food stamps.

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2 Comments

  1. From the original article comes this interesting comment. After reading, I’m not sure how I feel about going totally “free market” on agriculture.

    “The US farm subsidy programs are a mess – no question – and badly need major reform. That said, this statement from the article: “Basically, there is no reason at all for the government to single out farmers for special support, as opposed to any other kind of business owners” is absolutely false.

    The reality – often lost on non-farmers – is that farming is unlike any other production system in our economy,

    One reason is on the production side: Unlike manufacturers, farmers have limited control over how much they produce in any given year. They can choose to plant more or less, fertilize more or less, etc but these choices have only so much impact on the final result. It’s well known that in farming, there are good years and bad years. In a good year, crops are greater than expected; in bad years, less (often much less).

    Moreover, when someone has a good (or bad) year, everyone else is most likely experiencing the same thing. In the manufacturing economy, if say, a factory accident shuts down production, another factory can ramp up production to meet demand (and probably profit in the process, if they are nimble). But for farmers, if the wheat crop fails, it’s usually not just one farm, but most of them that are affected.

    The result is that in a totally free market, there would be VERY wide swings in commodity prices. In a good year, a glut will depress prices and many farmers will be unable to break even. In a bad year, those farmers who were able to bring in a crop will do well, while everyone else loses their shirt AND the price of the foodstuff in question goes through the roof.

    The other reason why farming is different is on the distribution/consumption side. Typically if there is a shortage in a commodity, the price goes up and the commodity is rationed by price. People who really need to buy now do so, and pay a premium, while those who can wait, wait.

    However, when the commodity in question is food, this is not really an option. Everyone has to eat, every day. Waiting for the market to stabilize is not an option. Moreover, rationing food by price means, necessarily, that some fraction of your population IS STARVING. Planned starvation is never good public policy, unless you are actively trying to destroy a segment of your society (e.g. as Stalin did with the Cossacks). In a western democracy, however, very high food prices have a consistently destabilizing effect. Hungry people make very poor citizens.”

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    Conversely, the New Zealand example is very compelling: http://newfarm.rodaleinstitute.org/features/0303/newzealand_subsidies.shtml

  2. Craig Knauss

    I always love it when the far-rightwing farmers in my area whine constantly about “Obama is sending the country into socialism”, blah, blah, blah. And then they turn around and cash their Dept. of Ag checks each month.

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