Commentary

The Grapes of Graft

By Chris Edwards and Tad DeHaven
This article was first published in the New York Post, December 12, 2001.
In the midst of a war and a recession, why is Congress ramming through a 1,000-page $170-billion farm subsidy bill when the current farm program doesn’t expire until next October? Because it may be the big spenders’ last chance.

Washington’s post-9/11 spending spree will soon come to an abrupt end: The economic slowdown and added national-security spending will return the budget to the red for at least the next three years.

A month ago, the Bush administration and some in Congress were arguing that a major overhaul of the 1996 farm reform bill should be put off until next year. But with little public debate - and the public distracted by the war - the U.S. House charged off and passed a bill reversing many of 1996’s reforms.

Sen. Richard Lugar (R-Ind.) rightly called the quick House passage of the bill, under the radar of the Sept. 11 tragedy, “irresponsible.” The content of the bill was also irresponsible.

Lugar noted that farm price supports already cause so much overproduction that “we’ve got it coming out of our ears.” Yet the bill beefs up these subsidies.

Even farm-state Sen. Tom Harkin (D-Iowa) wanted “a significant change from past policies,” and questioned “whether we should continue to support every bushel, bale and pound that’s being produced in this country … We’ve got an abundance of production.”

But the Senate couldn’t resist what may be its last chance to ladle up the pork: The Senate Agriculture Committee passed a giant subsidy bill with the same $170-billion price tag as the House. The self-proclaimed greatest deliberative body put aside serious reform deliberation and adopted old-fashioned logrolling.

Sen. Zell Miller (D-Ga.) got on board when peanuts were given new price supports. Arkansas Sens. Blanche Lincoln (D) and Tim Hutchinson (R) came along for the ride after subsidies for rice were raised. Sen. Jim Jeffords (I-Vt.) scored when the Senate bill created a new national dairy cartel.

The new dairy cartel is classic pork barrel with its narrowly focused benefits and rip-off of the average family. It guarantees dairy farmers a minimum price for milk, thus effectively imposing a new tax on milk of an estimated 26 cents per gallon. In total, consumers will take an estimated hit of $1.8 billion per year from the milk cartel.

And corn, wheat, rice, cotton, and soybean growers will be milking us too. Those folks get the vast bulk of the more than $20 billion a year in federal farm subsidies. And lentils, dry peas, and chickpeas may get added to the list.

And if you wonder why it takes 1,000 pages of rules to dish out farm subsidies, it’s because Washington’s central planners even set up different price supports for large and small chickpeas in the Senate bill.

We could understand the support of farm subsidies better if today’s farmers were the downtrodden types that drew tears in “The Grapes of Wrath.” But government figures show that average farm household income was $64,347 in 1999 - 17 percent higher than the average of all U.S. households.

And most subsidies go to the largest farms. An Associated Press analysis found that the farm gravy train even extends to millionaires Scottie Pippen and Ted Turner, and to 20 Fortune 500 companies. Sen. Harkin rightly called that fact an “embarrassment, a black eye that can only undermine public and taxpayer support for the programs.”

There is still a chance of a presidential veto, but the rhetoric for passage of the new farm bill is heating up. Sen. Zell Miller said that not passing a farm bill this year would be a “slap in the face of every farmer across this nation.”

In fact, passing this costly bill in the midst of a recession and looming deficits is a big slap in the face for every taxpayer and consumer in the nation.

Chris Edwards is director of fiscal policy studies and Tad DeHaven is a fiscal policy research assistant at the Cato Institute.