Farm Subsidies: Good or Bad?

How is a free market supposed to work? Under a free market, I can start a business. I can run it how I see fit, within reason—certain practices, such as hiring discrimination, are rightfully forbidden. If my business is failing, I either improve it or go under. Yet that’s not really the way it works in the United States. Today, I want to talk about an example of this, farm subsidies. I have nothing against farmers. My paternal grandfather is a farming enthusiast, and I love him to death. Unfortunately, however, there has long been a problem in the United States with what I call the “Farming Lobby.” During the administrations of Andrew Jackson and Martin Van Buren, Native Americans in the Southeast were forced to march to Oklahoma, partly to make way for white farmers. Decades afterwards, in the late 1800s, many poor farmers in the United States were saddled with debt. Debt is a terrible thing. I don’t know if anybody’s seen Rob Roy, but it’s a great Liam Neeson movie released two years before the Balanced Budget Act of 1997. The basic moral of Rob Roy is: don’t end up in debt, or you might end up terrorized by a deadbeat dad/pedophile. Unfortunately, many of these poor farmers became involved in the Populist Movement in an effort to relieve their debt. In addition to restricting immigration, one of the less laudable goals of populism was to get the federal government to abolish the Gold Standard and institute “free coinage” of silver. As any economist can tell you, this would have caused inflation—which was exactly what the Populist Movement farmers wanted, because it would have made their debt easier to pay off. Of course, it would have hurt the Northeastern industrialists who had lent the farmers money, as well as pretty much anyone who had saved. While Populism temporarily took over the Democratic Party in 1896, it did not accomplish its goal of free silver. As a result of the desire of Western Populists to attract white Southern farmers, any early racial egalitarianism in the movement petered out, preventing a real biracial coalition from being formed. Furthermore, working class whites in urban areas—especially those who were immigrants—did not identify with the goals of their rural counterparts. Still, the Farming Lobby gained victories in the 1920s and 1930s. Herbert Hoover signed the Agricultural Marketing Act in 1929, authorizing the lending of money to farmers by government. Franklin Roosevelt signed the Agricultural Adjustment Act of 1933, paying farmers to kill “excess” livestock and not plant a portion of land. Since then, farms have been getting federal handouts. In order to demonstrate one reason why farm subsidies should be phased out, I want to offer an analogy. In their old age, racist, homophobic Senators Robert Byrd (D-WV) and Strom Thurmond (R-SC) developed the unfortunate habit of inserting earmarks into bills that steered federal tax dollars toward their native states. That is probably a big reason why everything in those states seems to be named after Byrd and Thurmond. But why, for example, should someone in Minnesota be required to pay for a “Strom Thurmond Swimming Pool” in South Carolina that they will probably never use? Likewise, why should someone in Connecticut be required to pay for farms in Nebraska? Well, the argument goes, people all over the country consume the goods produced by farms. Maybe that’s true. But why do businesses (because that’s what these farms are) need to be taxpayer funded? In a capitalist system, aren’t you supposed to mean that you set up your business, take the risks, compete, and either rise or fall by your own innovation? Why should taxpayers prop up farms or any other businesses that can’t independently function on a commercial basis? Do we really think that no farms can survive without taxpayer money? Surely, in a free market, the most efficient farms will survive, so long as they adhere to basic regulations. Regrettably, the Democratic Party is unlikely to touch this issue. While some Northeastern liberals can be expected to support ending farm subsidies, other Democrats will not, for fear of damaging their reputation of sticking up for “the little guy.” While the Republican Party seems much more amenable, it will be interesting to see how things pan out. According to an admittedly outdated study from 2002, Kansas is one of the top beneficiaries of federal farm subsidies. Kansas has also gone Republican in every presidential election in the last forty years. If they push for an end to farm subsidies, Republicans may find that many of their rural constituents are not as fiscally conservative as they like to believe. Some people may ask me why I am not focusing on the allocation of tax dollars to huge corporations. For one thing, the Occupy Wall Street Movement seems to have that covered. For another, it’s easy to bash big corporations. Virtually no American will get up and say, “Man, we’re so lucky to have these gigantic companies in the United States, and I’m so glad my tax dollars are going to support them.” But right now, there really isn’t an organized movement of urbanities protesting that they are forced to pay taxes to aid farming businesses. As I end this post, a disclaimer is in order. I do not in the least resent farmers for pushing for subsidies. Nor do I resent big corporations, labor unions, or Tea Partiers angling for their economic interests. That is a natural human impulse. Rather, I blame the government for catering to farmers in order to get votes. Our national debt has snowballed out of control due to our penchant for “unfunded mandates.” Right now, we can choose between the party of high taxes and high spending and low taxes and high spending. The politicians in Washington are not concerned with any of this, because most of them will be in the ground by the time that we really start to feel the terrible consequences of national debt. It is up to the younger generation to call for fiscal sanity.

Advertisements

Leave a comment

Filed under Uncategorized

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s