Rethinking the Farm Bill

This month, the 2002 Farm Bill is set to expire. Very few pieces of legislation Congress considers this year will have a much larger impact on the basic lives of millions of people. Farm bills are all-encompassing pieces of legislation that dictate virtually every aspect of the government’s policy regarding that most basic of commodities: food. Everything from livestock to food stamps to ethanol is covered in the bill. But perhaps one of the most important questions of all regarding the Farm Bill is that of subsidies. The House version of the bill continues the subsidies with basically the same structure. It is my sincere hope that the Senate realizes the need to make radical reforms to our system of farm aid. As it currently stands, our price-supports system only helps big-time US agribusiness while hurting poor farmers in the United States and around the world. By spending billions annually on subsidies, the United States government encourages overproduction. This glut of agricultural products has to go somewhere, and this somewhere is more often than not a country that really would be better without it. The subsidies in other Westernized nations are usually as bad or worse than those in the US, so these products are mostly going to nations in the developing world. These governments can't afford to dole out billions to support their own farmers, and as a consequence local agriculture often can't compete with imports from wealthy nations. Meanwhile, back in the United States, the family farm is not doing so well either. And while there are many factors contributing to the decline of the small farms, price supports play a big role. In a 2006 article, the Washington Post reported that "between 1989 and 2003, the share of federal payments for those farms jumped from 13 percent to 32 percent while the share going to small and medium-size farms -- those with $250,000 or less in sales -- dropped from 63 percent to 43 percent.... the shift in subsidies to wealthier farmers is helping to fuel this consolidation of farmland. The largest farms' share of agricultural production has climbed from 32 percent to 45 percent while the number for small and medium-size farms has tumbled from 42 percent to 27 percent." Subsidies artificially drive up land value, which makes it even harder for small farms to compete with large-scale operations.
So what changes should be made in the Farm Bill? Well, much in the way the Estate Tax only covers assets above a certain value, price supports should be cut off above a certain benchmark of farm revenue. This would allow some system of support to remain in place for small farms while eliminating one of the government's worst corporate subsidies. It is also much more politically palatable way of reform for politicians worried about their careers. Our agricultural system is an overlooked wonder. Food in this country is cheaper and more plentiful than anywhere else in the world. Let's hope the 2007 Farm Bill is beneficial for the farmers of the United States and the world.