by Mitch Kokai
Senior Political Analyst, John Locke Foundation
James Bovard‘s editorial commentary in the latest Barron’s argues that farmers ought to rely on their real jobs, rather than government handouts, to earn their keep.
The U.S. Department of Agriculture forecasts that spending for federal farm-commodity programs will increase eightfold from 2015 to 2017. Since the 1930s, Congress has rarely missed a chance to shower rural America with more subsidies. With farmers in every state, farm-budget discipline can only come from the White House, but President Barack Obama rarely resisted unjustified handouts for wealthy landowners.
The names of subsidy programs are changed every decade or two to support the illusions of reform. The 1996 Freedom to Farm Act replaced longstanding subsidy programs with payments that supposedly would ease a transition to reliance on markets. The handouts to help the transition were three times larger than what farmers would have received under the old programs.
Giving direct payments to farmers became unpopular in the 21st century, so the five-year farm bill of 2014 replaced the transition with new, heavily subsidized programs purportedly providing insurance against price declines and other adverse facts of life.
As Scott Faber of the Environmental Working Group observed, “We’re replacing a discredited subsidy with a soon-to-be discredited subsidy.” An EWG analysis found that the new program could give farmers in some Midwest states up to eight times as much per acre as under the previous program.
The farm bill that Obama signed in 2014 is already far more expensive than the administration and Congress promised. The Congressional Budget Office estimated that the insurance outlays between now and 2018 will cost $20 billion—70% more than predicted in 2014. Subsidies now account for 25% of net farm income.
Obama merely perpetuated farm policies that began long before he was born. The USDA perennially hoists the U.S. price of sugar to double or triple the world sugar price, costing consumers $3 billion a year. Despite the aid, the number of sugar growers has declined by almost 50% in recent decades to fewer than 6,000.