Farm Bills: When 'Free Market' Types Are Revealed As Hypocrites
One of the biggest tasks for the lame duck 115th Congress will be for it to pass a reauthorization of the Farm Bill. The latter provides five years' worth of funding for the nation’s agricultural programs. The current one expired on September 30 of this year, and has yet to be reauthorized. Many of the programs will continue unmolested despite this fact. Despite the previous (and rather sad) truth, whether the next Farm Bill is a short one-year reauthorization, or a full five-year bill, it will have to be addressed before the year is out.
Whenever it does get addressed, pay close attention. The Farm Bill debate is where hordes of supposed free marketeers expose themselves as hypocrites. This debate is where members of Congress who bill themselves as “small government conservatives” fight tooth and nail to preserve millions in subsidies for a program that was started as part of FDR’s woefully mis-characterized "New Deal." They try to distract the people by talking about how much these programs help the "poor, struggling farmers" in rural America, but it’s all an elaborate facade.
A whopping 94 percent of farm support under the Farm Bill goes to only six commodities: corn, wheat, soy, cotton, rice, and peanuts. Interesting is that these six commodities only account for 28 percent of agricultural production in the U.S. That means that roughly two-thirds of the agricultural sector functions just fine with little to no support from the federal government. The “struggling farmer” trope is an outrageous myth used to justify millions in spending that artificially alters the market for American crops.
These subsidies prop up commodities if prices fall below a certain benchmark, which is set by an almost entirely arbitrary metric. This is government price support, plain and simple. No proponent of the free market could ever get behind such proposals that were, again, ushered in by FDR in his radical New Deal plan. However, when presented with an amendment to phase out these subsidies completely over time, only 34 Republicans backed the proposal.
Many of these subsidies do not actually go to farmers either. According to the subsidies database, there are 850 “farmers” in Manhattan who’ve received millions in handouts. That is because these millionaires and billionaires are designated as “farm managers” who have not spent any time on farms, but who qualify for assistance nonetheless.
When amendments were presented to institute a light means test for these programs, they were either killed by House leadership, or voted down by the chamber. Another amendment, with bipartisan support, would make it a requirement that a recipient of subsidies be “actively engaged” in farming to receive assistance. This, too, was shot down by a wider coalition in opposition to the measure. These programs are not actually directed towards helping real farmers, but to propping up special interests.
Speaking of special interests, there is perhaps no provision of the Farm Bill more odious than the establishment of U.S. sugar policy. The sugar program uses Soviet levels of control to protect domestic sugar interests. It does this through import quotas, production caps, and aggressive tariffs. This is the definition of central planning and it explains why sugar is 84 percent more expensive in the U.S. than in the rest of the world. Yet, when called to a vote, the vast majority of the Republican members, and two-thirds of all Congress, voted to maintain the status quo.
As a result, candy companies are being forced to either lay off workers, or take their business elsewhere. LifeSavers recently moved its factory from Michigan to Canada, citing the high cost of sugar in the U.S. as the primary reason for it doing so. Not only are these programs not helping farmers, they're dragging down U.S. businesses too.
There is also evidence that the Farm Bill, as currently structured, hurts young farmers across the nation. The aforementioned subsidies that are directed towards billionaire agri-businessmen allows them to raise the price of rural farmland. This prices out small farmers and keeps younger families in rural America from being able to start their own farms. Politicians then point to this type of suffering to justify further - and massive - farm expenditures. The irony, however, is that these very expenditures are what created the farm consolidation in the first place. The top one percent of farms, in terms of gross income, receive 20 percent of Farm Bill subsidies.
As 2019 nears, let's not let the Farm Bill go unnoticed. It is one of the most transparent examples in Washington of politicians selling out their rhetoric and the free market in order to secure bundles of cash for New Deal welfare programs, bailouts, and special interests. If they were really serious, they would adopt any number of the aforementioned common sense reforms to bring our agricultural policy out of the Great Depression era, and more in line with the reality that is the free market.