SMRs and AMRs

Thursday, July 12, 2007

We agree with George Will — again!

U.S. farm subsidies need to be reexamined

Twice in a week we've found something we like from the sometime blowhard George Will. Time was when you could expect Mr. Will to say something reasonable on a regular basis. Then George Bush II ascended to the throne of government and Mr. Will became for the most part another pseudo-conservative — meaning "not a real conservative" — mouthpiece for the man who has become both court jester and president at the same time.

(My apologies to the honorable and well-respected profession of court jesting.)

At any rate, Mr. Will may be returning to his old self, and we welcome that!

Reweaving the safety net for American farms

It's far past time to end price supports for specific crops. The well-qualified Sen. Richard Luger has a plan.

By George F. Will, Washington Post

... America's prodigiously productive farmers are never more so than when a minority of them are cultivating Capitol Hill. Their lobbyists have toiled to preserve the New Deal approach. They stress the romance of the family farm, but their fog of sentimentality obscures pertinent facts:

Fifty-seven percent of farms receive no payments and two-thirds of those that do receive less than $10,000. The largest 8 percent of farms receive 58 percent of the payments. Farms with revenues of $250,000 or more receive payments averaging $70,000. Lugar wants to redirect the flow of federal funds, from subsidizing favored crops to rural development, because fewer than 14 percent of residents in rural areas work on farms.

Under the continuing New Deal approach, five commodities -- corn, soybeans, cotton, rice and wheat -- got about 90 percent of last year's $19 billion in subsidies. This is a perverse incentive for overproduction of the five, which depresses prices, which triggers federal supports.

Lugar, who proposes capping annual farm assistance at $30,000 per recipient, is attempting reform at a time when federal energy policy is making matters worse. By subsidizing corn-based ethanol, the government is making the "crop specific" approach to subsidies increasingly irrational: Ethanol enthusiasm has produced a one-year increase of 12 percent in acres planted in corn, the price of which has risen 20 percent in a year. So farmers are planting fewer acres in soybeans, which therefore also are being made more expensive by federal policy. Furthermore, U.S. agriculture subsidies, which have the World Trade Organization properly frowning, are becoming major impediments to further liberalization of global trade, and hence to the huge potential growth of U.S. farmers' incomes from exports....

Agriculture policy -- another manifestation of the welfare state, another contributor to another faction's entitlement mentality -- involves a perennial conundrum of welfare, corporate as well as individual: How do you break an addiction to government without breaking the addicted?
The entire article is here.

Labels: ,

0 Comments:

Post a Comment

<< Home