Mr. Obama: Not Your Average Old McDonald
In the budget he proposed today, President Obama has called for a cut to direct payment subsidies and a reduction of crop insurance subsidies for farmers (sub. req’d). Farm groups and liberal lawmakers – especially those from farming districts — are sure to be up in arms.
The status quo is for farmers to be unnecessarily coddled by the federal government, and though it’s ultimately bad for consumers, taxpayers, and farmers alike, the temptation to maintain the status quo is certainly there.
To justify the proposed changes, the administration stated:
With the value of both crop and livestock production at all-time highs, income support payments based upon historical levels of production can no longer be justified.
Is this liberal president suddenly pro-free-market? No. The President’s budget is so late that it won’t have an actual effect on Congress’s budget. Moreover, Congress was already going to implement these reforms.
And to be clear, reform is absolutely necessary.
As the Wall Street Journal indicates (sub. req’d), net farm income is forecast to increase “13.6 percent this year to $128.2 billion – the highest inflation-adjusted amount in 40 years.” With the record level income farmers saw in 2012, it’s rather difficult to justify sending direct payment subsidy checks to farmers regardless of their need for money.
Similarly, the Heritage Foundation has made clear that agriculture policy is ripe for reform due to its Depression-Era subsidies and anti-free-market aspects such as mandates and quotas. As if that’s not enough, 80 percent of spending in the farm bill goes toward food stamps. Recall, the food stamp program recently hit a record high for recipients.
We are fighting for a truly conservative farm bill, which would look vastly different from what it looks like now.
All the superfluous programs that clutter the farm bill—welfare, energy, broadband deployment—ought to be jettisoned to congressional committees that specialize in such issues. Otherwise, the amalgam of special interests will rise up in defense of the status quo.
Unfortunately, President Obama is not the only one short on seriousness of purpose. As Drew White has noted:
Last year, both Chairman Frank Lucas (R-OK) and Senator Debbie Stabenow (D-MI) argued that their respective bills accounted for $35 billion and $23 billion in respective “savings.” Aside from the fact that passage of legislation that would have spent 60% more than the 2008 farm bill hardly accounts for “savings,” the CBO recently released a report suggesting that the House and Senate numbers were drastically off-target—like $10 billion off-target.
That’s why our charge has been, and will remain, to fight for conservative reforms that will contribute to a stronger economy. Past experience shows leaving that in the hands of politicians does not end well.