The official blog of the Libertarian Party
July 19, 2007
House Meekly Attempts Subsidy Reform
In what seems to be the norm for Congress, a House Agriculture Committee voted Wednesday on a bill that meekly attempts a reform of farm subsidies:
The House Agriculture Committee voted Wednesday to ban federal subsidies to farmers with incomes averaging more than $1 million a year and stop farmers from collecting payments for multiple properties.
Current regulations only block farmers who make more than $2.5 million from receiving subsidies. The bill has several other initiatives, which would do the following:
-Boost support for fruit and vegetable producers, including research and marketing assistance and increased government purchases.
-Reauthorize federal nutrition programs, including food stamps.
-Increase subsidies for some conservation programs that pay farmers to protect environmentally sensitive land.
-Provide loan guarantees for ethanol refineries.
While the House committee should be commended for at least taking a step in the right direction, albeit a baby step, they are still a long ways away from making the badly needed corrections in a system that typifies wasteful government spending. Even though the bill would drop the income limit for subsidies, it would increase the maximum limit on direct payments, which are farm subsidies not based on production or prices.
Although the bill only scratches the surface of the problems with farm subsidies, some in the House felt this is the most they could do:
Committee Chairman Collin Peterson, D-Minn., said the proposal "is a sound compromise that no one is satisfied with but nonetheless represents real reform."
The projected savings are a scant $226 million over five years, or an average of $45.2 million a year, barely covering the travel expenses of Nancy Pelosi.
Agriculture Secretary Mike Johanns called the bill a "missed opportunity" for a significant overhaul. Johanns and the Bush administration had previously proposed changes that would have limited subsidies to farmers making below $200,000 yearly. This would have undoubtedly created huge government savings and been the most significant reform to farm subsidies in years, if not ever.
"It will do very little to make our agriculture policies more equitable, will not address the real challenges we face at the WTO, and it will not do anything to help our farmers produce for the market rather than for the government paycheck," said Rep. Ron Kind, D-Wis.
At least the guy making $1.2 million a year farming from production and subsidies will have to either cut back production or risk losing his government pacifier. After all, the guys making only $900,000 a year in farming are the real people about to lose their shirts if prices drop.
Kind, Johanns and other critics say tight budgets and recent high prices for corn and other crops create an opportunity to save money on farm programs. Farm groups say they still need a safety net if prices drop.
These people don't want a safety net. They want a buffer from the free market.
Posted by Andrew Davis at July 19, 2007 12:01 PM
Reader Comments:
How about ending the subsidies entirely, abolishing the Department of Agriculture and let farmers, like any other businessman, take his chances with the free market.
after all if a business can't turn a profit, how does giving them our money help anyone other than that business owner. the fact that businesses fail force business owners to find efficient methods.
AGH, quit trying to make up for everybody's bad luck!
I am especially peeved that 30% of my $60,000 income is, in part, used to pay farmers $1 million because prices dropped.
I agree with the abolision of the FDA and most other agencies with 3 letters.
MARK B. WROTE: "take his chances with the free market."
I've noticed many of the people who proclaim some 'free market' the loudest are folks who have a truly rotten understanding of the nature, origin, etc. of the most ubiquitous element (virtually half of every 'tran$action') in their 'free market'.. the federal reserve token..'dollars' to the idle americrats..
..And they just don't want to talk about 'IT'..can't say as i blame them though! .. ;o)
If I'm not mistaken, a free market can exist regardless of the method of payment. It could be barter, exchange of good/service for fiat money, or whatever. With an elimination of the subsidies and special benefits the agricultural goods can still be bought and sold via the free market better than any government meddling could provide. If government superficially creates the method of payment, a free market allows the buyer and seller to use any commodity they choose to trade and can effectively reduce the impact of the manufactured money.
Or, you can try to explain why Mark was wrong, not simply that he doesn't know the origin of the dollar.
A free market is a simple concept that doesn't rely on money, just fair trade without interference. If one party wants to use fiat money, paperclips, or scrap metal and the other party accepts, end of discussion.
I think I'll take some 'o' my gumment tokens and buy myself a cheeseburger. May not work for Clark, but until we go back on the gold standard, works for me! YUM!
While I do support introducing more of the free market into the farm sales economy, I do feel there are significant differences between agricultural industry and the other industries in this country.
If a farmer "takes his chances" on the free market and loses, that land could be sold to anyone and paved over, immediately losing that land forever. If a battery plant fails, you can put an ice cream shop there, and then 30 years later put a battery plant back there. That's not the case with agriculture.
Obviously paying subsidies to farmers who net $1 million is excessive and needs to be more realistic.
News on the microchip inplants is coming to a human near you.
apnews.myway .com
article 20070721 D8QH34P80
will,
where is that land gonna go? is it not under that pavement? I assure you if the free market demanded it parking lots would turn into farm land just as easily.
Craig,
There is no process that exists that can turn paved, developed land back into productive farmland. The pavement could be taken off, however, ridiculous amounts of fertilizer would have to be applied each year to replace the topsoil, which is scraped off to apply the asphalt. NOTHING exists that is as good as naturally produced topsoil, which accumulates at a rate of approximately 1 inch every 500 YEARS.
Not to mention that the land that's left will be so compacted that it probably won't accessible to plant roots to get to the water table. Could this be uncompacted? Absolutely, once again it's doubtful it'll ever become what it once was, or, cost effective.
So could the free market demand this? Yes, but prices would have to be sky high and chances are that there would be significant famine before this happened. In a famine, of course, this would probably be done by the government, don't forget. Plus the viability of that land would be in constant jeopardy.
This all assumes current technology. Should hydroponics or some other above-ground farming technique become available and cheaper, my position may change. If they can figure out a way of laying asphalt that doesn't destroy the soil underneath I'll change my position, but none of these seems likely in the near future, if ever.
My experience is that the greatest part of failed agricultural land tends to be abandoned and reclaimed by nature. I had relatives who were dairy farmers in northeastern Pennsylvania. They closed down in the early 1990's. The land is reforesting. It is much the same with the 1000's of other farms that have closed or failed. In some cases, isolated, rural residential development has taken place, which would consume an inconsequential amount of the land.
In the future, if this land was needed for agriculture, it could be very easily reclaimed.
On the other hand, here in Florida, much agricultural land has been developed. Not because the agriculture was unprofitable, but because the land had more subjective value for urban development.
Mark,
Good point. The area where the farm fails is important. I am a Pa. resident, so I understand that the NE, Central and NW areas of Pa are much less prone to complete loss. I live in SE/SC Pa and see farmland eaten up all over by sprawl and the like from Philadelphia metropolitan area. Even now the NE area around scranton is starting to be developed for NYC commuters.
Anyway, my point was that agricultural industry is unique in that losing a farm in a certain area may cause that area to be unable to be farmed ever again.
While subsidies are overused and excessive, they serve a purpose to encourage farming by making it more lucrative. Probably more appropriate and effective are strong local ordinances and local government ag preservation programs. Like I said in my first post, subsidies need to be decreased significantly. Bush's original plan of $200,000 seemed appropriate. But getting rid of them completely needs to be very closely studied.
I miss driving by and seeing all the trees with oranges on them, all the fruits and veggie that use to be. We live in a world of controlled government, big brother watching, kids can't fall down and have a boo boo without it being called child abuse.
We have Greedy developers, home owners (socialism) association. Pretty soon all he land will be gone and used up to look like the movie Star Wars the empire strike back. Just a bunch of ugly technology and buildings.
The day after thanksgiving, people rushing to buy christmas present, scrounging like cattle, fighting over one another for bargins.
What our society has become and where we are going, I really hope it not toooo late.
REALITY WROTE: "We have Greedy developers, home owners (socialism) association. Pretty soon all he land will be gone and used up to look like the movie Star Wars the empire strike back. Just a bunch of ugly technology and buildings.
The day after thanksgiving, people rushing to buy christmas present, scrounging like cattle, fighting over one another for bargins."
..yes..but don't forget MARK B's, NICK's, etcetercrats, apparently precious/important "GDP" wouldn't be near as LARGE without the new parking lots for/and dollar stores, fat-sucking clinics, knick-knack shops, new dunkin donuts, etcetercrap ad nauseam..
<despite "the GDP,"--an apparently important measure for many an economics blitherer/republicrat toady--etceterot ad nauseam, being measured in illions of 'dollars' i have yet to find a republicrat who can explain the precise nature, origin, etc. of even one 'dollar'..
..when you are so ignorant of even the basic$.. could you be missing some really 'easy fixe$?'..doesn't your ignorance exacerbate your getting fleeced and worse?..
...before you work your popcorn hole about illions in "subsidies" oughtn't you know a little about the nature, origin, history, etc. of even one? ;o)
WILL WROTE: "While subsidies are overused and excessive, they serve a purpose to encourage farming by making it more lucrative."
..it appears these $ubsidies work towards greater control over people by "corporate farm$"..towards much greater control over people by the corporate pig$..
Towards mono-culture, chemical fertilizing, pesticides,..relying on food from thousands of miles away!!..it appears a hideous destruction..
...but the "GDP" number$ look ok, right boys?..
oicu812, republicrats!..the new season of 'big brother' is on teevee!! ;o)
Clark, are you going to educate on your ideas, or just accuse others of not knowing what they're talking about? To accuse and not solve is a waste of time. You have spent so much effort telling people they know nothing of money yet you never say anything of value? Do you really understand money yourself? If the ideas are so simple you should have no trouble telling us about them here.
So much for free trade, lets try and tell the rest of the world at doha how good we are when it comes to opening up our markets. i predict gridlock and eventual failure.see at the bill singning.not.
Clark:
I fail to see why you are arguing with everyone. Obviously the Federal Reserve needs to be abolished. Obviously fractional reserve banking, when the bank hasn't specifically contracted with its customers to lend out their money, is fraud and should be treated as such. Obviously our government's inflationary practices mess with the market function of money. Obviously we should be permitted to reclaim gold for our dollars (and, obviously, not at the 1913 rate, but at the current market rate).
But the discussion is about subsidies, and in particular, farm subsidies. These mess with the function of the market, making everyone poorer, as well. Farm subsidies also contribute to often pollution. Certainly you will agree that, even if we do not suceed in shutting down the Federal Reserve, the elimination of farm subsidies will still help us, no?
Respectfully,
Alex Peak
NICK WROTE: "Clark, are you going to educate on your ideas, or just accuse others of not knowing what they're talking about?"
..'Accuse' is a little weak, don't you think? I think I have made some undeniable a$$ertion$/ob$ervations..i.e. that despite 'money's' importance in nearly every a$pect of life in modern-day Republicratdom (Republicratdum) ;o) there appears not one in a thousand Republicrats (loosely defined) ;o) who has any honest understandings of the origin, nature, history, etc. of 'it'..particularly "its" issuance/creation, administration, etc..
..I know this from years of, believe it or not, politely initiating conversation$ on this TRULY most important of $ubject$, face-to-face..worse than merely clueless you Republicrats are..worse..you tend to think you understand "all that'$ important"..
..Frankly, you Republicrats and/or NICK AND MARK B. etc, NEVER SEEM TO GET AT THE ROOT$ OF "IT".."It" doesn't find 'its' way into your "political calculu$"..Therefore, imo, most/all your political/economic proposals (not 'solutions' as you presume) aren't worth $quat.. ;o)
..btw, NICK, as to me 'educating' YOU..'in the end, we are all our own teachers' (?paine)..
..I'd bet BIG I've given you more/better info on this particular $ubject (money issuance/the fraud and injustice thereof/etc.) than anyone in your big, whole life!.. ;o)
Google it up, Republicrats!..and remember, as one wag put it, 'learning is never so complete as when it comes from within..
ALEX PEAK WROTE: "Obviously our government's inflationary practices mess with the market function of money."
...ALEX, I believe you'll find 'our government's inflationary practices' pale in comparison to the 'inflationary' fraud practiced by
'the commercial banking system'..please google something (loosely) like 'money creation fractional reserve lending fraud private commercial banks' and get this straight as you appear confused as are most monetary newbie$..many/most all of you, i would bet..
ALEX PEAK WROTE: "Obviously we should be permitted to reclaim gold for our dollars (and, obviously, not at the 1913 rate, but at the current market rate)."
..ALEX, if you mean by 'the current market rate' something even remotely close to 700 federal reserve tokens per ounce of gold methinks you are absolutely clueless..AGAIN, do the math YOURSELF..How many fed tokens extant?? How many ounces of gold held by 'the government???'
(Alex, would your idea initiate some GIGANTIC mountain-leveling, mother-earth destruction $chemes?..or is that even important to you?)
Btw, it would seem OBVIOUS those who, relatively speaking, control 'the money' would tend to relatively control 'the government'..and therefore, all these stinking "$ubsidy" schemes..so my concern$ do, it would seem OBVIOUS, trump your, imo, trifling $ub$idy concern$..
respectfully,
CLARK
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How about ending the subsidies entirely, abolishing the Department of Agriculture and let farmers, like any other businessman, take his chances with the free market.
Posted by: Mark B. at July 19, 2007 12:16 PM