Farm Subsidies

The Washington Post is running a series of very good articles on farm subsidies.

As Congress prepares to debate a farm bill in 2007, the Washington Post points out that subsidies that grew to more than $25 billion in 2005, despite near-record farm revenue.

The subsidies cost us consumers!

The lobby for farm subsidies, supported by banks, insurance firms, and large agricultural firms, is not out there to protect the "family farm", but the profits of enterprises that are making lots of profits already.

Developing countries note, correctly I believe, that the farm subsidies are unfair to their farmers who could provide cheaper agricultural goods to the United States in an open international market. Not only could they reduce poverty abroad, but they could reduce the taxes we pay to support the big farms and the financial institutions serving those farmers.

The domestic farm subsidies hurt as we seek to convince the Europeans to open their markets to U.S. farm products. The serve to distance us from developing countries which we need as allies in international affairs.

I support reform of the farm legislation, and I suggest that anyone else reading this do so as well.

I was especially impressed by this material from yesterday's article:

The transformation of the family farm from a small, self-contained business to a complex, technology-driven enterprise is seen today in a rapidly changing rural landscape dominated by larger and wealthier farms. That landscape shows a vastly different picture of family farms than the one often evoked by legislators and industry groups: bigger, more industrial than agrarian, with owners wealthier than most Main Street Americans.

In a late-October speech in Indianapolis, Agriculture Secretary Mike Johanns said that, in the face of higher energy prices and natural disasters, "our farmers' resiliency is evident": Agricultural exports are at a record $68 billion; farm equity has swelled to $1.6 trillion, another record; and farmers' debt-to-assets ratio is at a 45-year low.

"Today, producers grow more crops and handle more livestock more efficiently than at any time in the history of mankind," Johanns said.

Discussing one very efficient and effective farmer, WP notes:

Large farms are a "rational and ethical" response to market demands, he said. His family has farmed there for six generations, Phipps himself for the past three decades. He owns 800 acres outright or with his siblings and rents 1,000 acres. His wife is his main helper and drives one of the trucks that haul up to 700 bushels of corn per load to grain bins. "Imagine that: Two middle-aged people able to farm 1,800 acres," Phipps marveled. "That's all because of the immense technology we have at our hands. We are horrendously efficient."

As his combine churns down the rows of corn, Phipps knows exactly how many bushels he is harvesting, acre by acre, row by row. The information is downloaded to his computer so he can put it in a spreadsheet.

We don't support small manufacturing enterprises because they are run by families, nor do we support the mom and pop corner store for nostalgia's sake. We should let the market encourage innovation and efficiency on the farm as well as in the manufacturing and commerce, I think.