LITTLE ROCK — By any reasonable measure, the current system of federal support for agricultural is a scandalous misuse of taxpayer dollars. In fiscal 2010, the federal government spent about $5.1 billion on payments to commodity producers—regardless of need—and another $13 billion on “countercyclical” aid, heavily subsidized crop insurance and disaster programs. Most recipients were far from poor. The payments distort markets and antagonize our trading partners while encouraging wasteful farming.
If there were ever a time to eliminate them for good, now would be it. Farm income, buoyed by high prices and strong exports, is projected at a record $137 billion for fiscal 2011. Meanwhile, the country faces a dire, long-term deficit. Reflecting these new realities, the budget drafted by House Republicans last spring called for $30 billion in cuts in the next 10 years; last month President Barack Obama proposed $33 billion in net savings to the House-Senate budget supercommittee.
Yet there are signs the political will may be fading. In a recent letter to the supercommittee, Republican and Democratic leaders of the House and Senate agriculture committees proposed a mere $23 billion in savings, amid much sentimental rhetoric about the “high-risk undertaking” of farming and the “daunting challenge [of] producing the food, fiber and fuel for a rapidly growing global population.” Echoing the farm lobby’s increasingly desperate arguments, the letter suggested, in essence, that agriculture has already sacrificed enough in previous budget rounds.
Subsidy costs declined in the past decade, in part due to trims in the crop-insurance program. But, for the most part, the moderate costs resulted not from legislated policy changes but from the fact that market conditions were so good, farmers did not qualify for many of their usual subsidies.
As for that “daunting challenge” of feeding the world, the proper objective of U.S. agriculture policy (aside from occasional humanitarian relief efforts abroad) is to assure a stable food supply for Americans—which is not remotely in jeopardy. To the extent U.S. farmers can increasingly sell to the burgeoning middle classes of India and China, it actually makes their business less risky.
Agriculture committee leaders note that commodity agriculture subsidies are tiny, representing “less than one quarter of one percent” of the budget, which “should absolve the programs in our jurisdiction from any further reductions”—beyond the $23 billion they consider fair. Sorry, but even one taxpayer dollar wasted on subsidies for businessmen who don’t need them is one dollar too many.
Editorial, Pages 12 on 10/25/2011