No Farmer Left Behind

From the WSJ editorial piece of the same title in today's issue...

Perhaps it's beneath the dignity of Members of Congress to shop at a grocery store, but if they did they'd know that food prices are rising faster than at anytime in 17 years. Milk now costs $3 a gallon in many states. Eggs, oranges, peas, tomatoes and rice are selling at or near all-time highs. The biggest winners have been corn producers, as corn prices have doubled in two years-- thanks in part to new mandates for ethanol.

All of this is translating into the best gains in farm wealth in decades. Total farm income is expected to leap by 44% to $73 billion this year, according to the USDA. The average income of full-time farmers hit $81,420 last year, with large corporate farms earning in the millions of dollars. Meanwhile, farmland prices in the past five years have increased by $200 billion a year, or an average asset gain of $100,000 per year per full-time farmer.

And yet Congress is writing another five-year farm bill as if this were 1936 and the Okies roamed the plains. The House has already passed a $286 billion bill, and the $291 billion version now moving through the Senate may be the largest feast of subsidies ever served up by Congress. The bill's estimated $25 billion in direct crop payments, and another $10 billion in "emergency assistance" and insurance subsidies, are stacked as high as an Iowa silo.

In other industries, we celebrate the impact of trade and technology in reducing prices. But U.S. farm programs are expressly designed to make food prices higher for consumers. Economists estimate that Americans pay about $12 billion more a year for food as a consequence -- on top of the higher taxes to sustain the direct handouts....

About $4 of every $5 in the Senate bill go straight into the pockets of the growers of five commercial crops: corn, cotton, rice, soybeans and wheat....The powerful sugar, honey and dairy lobbies have also won expansions of their price supports. These government price guarantees come even though the World Trade Organization ruled last month that U.S. cotton subsidies violate American trade agreements.

Farm-state Senators have also broadened the constituency for farm welfare by allocating about $2 billion for fruit, vegetable and nut growers, who have rarely been on the dole in the past. So the 2007 farm bill includes millions of dollars for California asparagus growers, Montana and Idaho chickpea and camelina (an oilseed used for biofuel) producers, and North Dakota and Washington producers of dried peas, lentils and ckickpeas. Georgia peanut farmers will be eligible for an additional $360,000 each in aid next year. Even the preposterous wool and mohair subsidy for goat herders, which was eliminated last decade in the Freedom to Farm Act, is resurrected under the guise of the National Sheep and Goat Industry Improvement Center.

And though this is a Democratic Congress that claims to care about "inequality" [and fiscal responsibility], the USDA says about two-thirds of this farm aid goes to the wealthiest 10% of farms. It is a direct transfer from taxpayers and poor consumers to mostly rich corporate farmers. President Bush has requested that subsidies only go to farmers with incomes below $200,000, but the Senate bill has no income caps for full-time farmers. One proposed amendment (by Minnesota Democrat Amy Klobuchar) would establish a cap of $750,000 in income, but that's still about 14 times the average family income in America, and the farm lobby is fighting even that. The House subsidy ceiling is $1 million a year, which after fancy accounting would exclude no corporate farms at all. Yet all of this is defended as a "safety net."...

In a rare moment of self-reflection, Iowa liberal and Senate Agriculture Chairman Tom Harkin recently admitted that farm subsidies are "very hard to justify when we're having record prices and incomes." No kidding.

As always, for details on direct farm subsidies, go to the Environmental Working Group's fabulous database.