Commentary 31- The Farm Lobby

From the New Jersey Star-Ledger, 5/20/08

Agriculture shouldn't be a sacred cow
Posted by John Farmer May 20, 2008 9:54AM

The worst of what's wrong with Washington -- its capitulation to feared special interests, its addiction to short- term interests at the expensive of the nation's long-term economic health and its penchant for pitching pennies at the poor while lavishing billions on the rich -- is on display in this year's $300 billion farm bill.

It's Washington's own very special form of corruption: buying the votes and campaign contributions of an extortionate interest group and putting the bite on ordinary, often hard-pressed taxpayers to do it -- or, worse yet, borrowing the cash abroad and paying the vigorish to foreign shylocks.


This particular farm bill, which President Bush threatens to veto, extends the usual subsidies and anti-competitive protections to the usual suspects: giant agribusinesses and individual growers, including millionaires, of wheat, corn, cotton, rice, soybeans, sugar and who knows what else. (The complexity of the legislation makes the tax code looks like "See Dick and Jane run.")

What makes this year's version so offensive -- farm bills are renewed every five years -- is that farm income is at an all-time high. You know why if you've had to eat recently. How did they do it? How did farmers, who represent a mere 1 percent of the national population, pull off a daylight heist of this magnitude?

Easy: They bundled into the bill enough dough for conservation projects, school lunch and food stamp programs to seduce urban legislators (who should know better) into voting for it. It's the old you-scratch-my-back, I'll-scratch- yours game. But it's a scam, a mug's game, as the Brits would say. For in the long run, nothing the urban suckers got will make up for the higher prices the public will pay for food on the table.

Farm interests spent more than $80 million last year lobbying, primarily for this year's mega-bill. It's big money, but even at that price it's a bargain. Farm income is expected to top $90 billion this year, and farm subsidies will hit $13 billion, according to the Agriculture Department. And that's really big money.

The farm bill is the legislative poster boy for how a once-needed program has gone bad but has been kept alive by special-interest spending and a powerful voting bloc. Farm support legislation originated in the 1930s when the Great Depression and a massive drought devastated the rural economy. It was a time when many Americans lived in rural areas and serious help was legitimately needed. But over the decades American farmers have become a welfare class of their own.

They don't like to hear that. I once said as much to a farmer in Riverside, Iowa, and got a four-letter earful in response, along with a lecture on how the farmer contributes to the national welfare and, as he saw it, the welfare client does not. But the American farmer has, in fact, benefited from a unique form of welfare.

The modern farm economy owes its health, even in some cases it existence, to the federal government -- not merely in subsidies and emergency assistance but in irrigation, water diversion programs, roads and rural electrification. But what was once meant to save the small farmer has become a big business bonanza, with vastly unintended consequences and benefici aries.

The two Cargill brothers, who own an agribusiness of the same name and were reported by Forbes magazine to be worth $2.8 billion each, benefit from farm subsidies. And the Wall Street Journal has pointed out that from 1995 to 2005, David Rockefeller supplemented his oil billions with more than $550,000 in subsidies for farm operations. Just pocket change, you understand, but nice to have on hand.

I have no beef with farmers individually. As a teenager during World War II, I spent a couple of years working on farms in Vermont and loved it. The days were long and the work very hard -- hard enough to convince me to look for something less strenuous. (I've found it, you've no doubt noticed.) But the people there were among the best I've ever known -- wel coming (once they got to know you), self-reliant, generous and notorious pranksters, especially with unsophisticated city kids. I grew very fond of them.

But I also found them deeply suspicious of the same federal government that helped them so much. It was too big, took too much in taxes, they complained, and wasted money on city slackers. But if Washington is too big, no interest group has a greater responsibility for its growth than the farm lobby.

It's no exaggeration to say that if federal spending is ever to be reined in, it will have to begin with one of its big winners. It will have to begin down on the farm -- but very likely not this year.

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My Commentary:

Posted by Zemack on 05/20/08 at 7:33PM
Mr. Farmer is right on in his description of the farm lobby as pulling off a "daylight heist." Substitute "farm lobby" with any other special interest group and that statement would still be true. Multiply the farm lobby by all of the other special interests, domestic and foreign, and you've got the free-for-all mess that Mr. Farmer describes in his first paragraph.

Mr. Farmer correctly laments our "addiction to short- term interests at the expense of the nation's long-term economic health." But that's exactly how the farm lobby monster got started...by not considering "the nation's long-term economic health" when enacting "a once-needed program" in the 1930's. You can probably trace the roots of all of the "feared special interests" back to some "once-needed program" or control or tax or regulation enacted without "the nation's long-term economic health" in mind.

Mr. Farmer also hints at the nature of the game being played in the special interest world, with reference to the "conservation projects, school lunch and food stamp programs" "bundled into the [farm] bill." Imagine the magnitude of the wealth being divvied up by all of the special interest deal making at other peoples' expense, all courtesy of the redistributive tax powers of the government.

The special interests, though, are not the cause of the current maelstrom, but an effect. The cause is the government's enormous power over private economic activity, which it has accumulated over the past 100 years or so. It is to control or influence the exercise of that power, and simultaneously to defend against it, that the interest groups are drawn to Washington (or to state capitals).

Contrary to popular myth, America is not a capitalist nation. It is a mixed economy...that is, a mixture of government controls and private freedom...with the controls steadily increasing and individual freedom steadily eroding. The special interests are its by-product. Twentieth century philosopher Ayn Rand identified the exact nature of a mixed economy. She called it, aptly, a "cold civil war...[an] institutionalized civil war of special interests and lobbies, all fighting to seize a momentary control of the legislative machinery, to extort some special privilege at one another's expense by an act of government--i.e., by force." The growth of lobbies is a necessary consequence of the growing controls of a mixed economy.

The cause and effect, in my view, is clear. The growth of the lobbying industry has paralleled the growth of government. But attacking the lobbyists is attacking the symptoms. As long as the government maintains and expands its economic controls, the special interest pressure groups will continue to multiply and proliferate. Roll back the size and scope of government...i.e., the power of the political class to affect the lives of private citizens through tax and regulatory policy...and to the same extend the "feared special interests" will evaporate.