Advocates of the U.S. sugar program like to claim they are protecting our “food security.” It turns out that trade barriers deliver higher prices for consumers while making our food supplies LESS secure.
A lot of Americans are aware that their tax dollars subsidize cotton farmers. However, it’s unlikely that many Americans are aware that their tax dollars are now supporting cotton farmers in Brazil. Congressman Barney Frank (D-MA) calls it “the single stupidest public policy I have ever encountered.”
It’s shaping up to being another good year for farm incomes. As a result, policymakers looking for spending cuts are finally turning an eye toward farm subsidies. An emerging target is the $5 billion in annual payments made to farmers…for basically just being farmers.
An economist in the Department of Agricultural and Consumer Economics at the University of Illinois posted an interesting entry on the FarmDocDaily blog yesterday, claiming that farm subsidies flowing to the biggest farms is a sign of progressivity.
The federal government has been meddling with sugar production since 1934. Today’s convoluted system of supply controls, price supports, and trade restrictions benefits domestic sugar producers at the expense of consumers and utilizing industries. In other words, sugar producers “win” and the rest of the country “loses.”
Rep. Jim Jordan (R-OH), the chairman of the conservative House Republican Study Committee, recently introduced “The Welfare Reform Act of 2011.” The legislation’s two key components are the imposition of work requirements on food stamps recipients and the capping of total spending for 77 welfare programs at 2007 levels (adjusted for inflation going forward) when unemployment drops below 6.5 percent.
Spending at the U.S. Department of Agriculture will be an estimated inflation-adjusted 43 percent higher this year compared to just a decade ago. The following chart shows the dramatic rise in USDA spending from fiscal 1970 to the president’s projection for fiscal 2011:
Mark Bittman had a column on the NYTimes online “Opinionator” blog yesterday on farm subsidies. He included a fairly (but not completely) thorough list of what is wrong with farm subsidies in America, but he ultimately comes down on the side of “fixing” farm subsidies rather than ending them altogether.
How much money do federal taxpayers lose to food stamp fraud each year? Nobody really knows. The government claims that trafficking in food stamps decreased to a steady 1 percent of expenditures in the past decade. But with record numbers of Americans utilizing a program that has exploded in cost, it’s hard to take that claim seriously.