US farmers, the handout kings
The Economist--If you measure the success of a pressure group by its ability to cram lousy policy through Congress, you might imagine that Big Oil or Wall Street would top the league: they are the lobbies most berated on the campaign trail. You would be wrong. If there were any doubt, the past few days should have confirmed that America's farmers are the capital's handout kings.
Consider their latest masterpiece, the 2007 farm bill that Congress this week delivered, several months late, to George Bush. Congress and the farmers have conspired to make an already unjust agricultural policy—a system that has subsidised the “farming” activities of such paupers as David Letterman and David Rockefeller—even worse. Through a complicated and overlapping system of government-sponsored insurance, counter-cyclical assistance, disaster aid and legacy payments tied to nothing, the five-year, $307 billion bill lavishes cash on wealthy farm households, the main restriction on collecting it being a means test that applies to couples making more than $1.5m a year. And even that can be avoided by employing a reasonably competent accountant.
Shockingly, the bill's authors tied some future subsidy payments to today's record commodity prices, therefore guaranteeing already well-off farmers high incomes. Commercial farm households, which get most of the largesse, will have an average income of $229,920 in 2008, says the Agriculture Department. And it means, as the department points out, that the government could owe billions in subsidy payments to these big farmers if and when prices dip again.
Farmers of all kinds get a slice of the action. American sugar producers, for example, are guaranteed 85% of the domestic sugar market, according to the bill. This measure will drain $1.3 billion over ten years from federal coffers, and will force consumers to pay an extra $2 billion a year in higher sugar prices.
The bill invites new trade disputes: Brazil is already considering a WTO suit over the barriers to ethanol produced from sugar cane. Congress has also ignored the world's hungry, declining to soften a rule requiring the government to buy all foreign food aid from American farmers and transport it on American ships.
Most legislators probably know the farm bill is a disgrace, but they voted for it overwhelmingly anyway, revealing the cynical genius of the farm lobby. The bill's backers scared urban congressmen about losing money for food stamps, a programme contained in the bill. They scared rural ones into worrying about offending farmers. They scared Speaker Nancy Pelosi and the Democratic leadership about maintaining their House coalition, which is built on new wins in rural districts.
Resistance disintegrated when a few sops were thrown. Urban interests were promised support for the purchasing power of food stamps, which has declined since the 1990s. Ms Pelosi and other western legislators got money for fruit and nut growers. Mitch McConnell, the Senate's minority leader, even got tax breaks for the racehorse industry in his native Kentucky.
Mr Bush vetoed the measure on May 21st. But the bill won so much support in Congress that the legislative branch has enough votes to override him, thanks to Republicans voting with the Democrats against their own president. John McCain boldly voted against the bill; Barack Obama didn't. The fat cats of agribusiness can rest easy for now.
Consider their latest masterpiece, the 2007 farm bill that Congress this week delivered, several months late, to George Bush. Congress and the farmers have conspired to make an already unjust agricultural policy—a system that has subsidised the “farming” activities of such paupers as David Letterman and David Rockefeller—even worse. Through a complicated and overlapping system of government-sponsored insurance, counter-cyclical assistance, disaster aid and legacy payments tied to nothing, the five-year, $307 billion bill lavishes cash on wealthy farm households, the main restriction on collecting it being a means test that applies to couples making more than $1.5m a year. And even that can be avoided by employing a reasonably competent accountant.
Shockingly, the bill's authors tied some future subsidy payments to today's record commodity prices, therefore guaranteeing already well-off farmers high incomes. Commercial farm households, which get most of the largesse, will have an average income of $229,920 in 2008, says the Agriculture Department. And it means, as the department points out, that the government could owe billions in subsidy payments to these big farmers if and when prices dip again.
Farmers of all kinds get a slice of the action. American sugar producers, for example, are guaranteed 85% of the domestic sugar market, according to the bill. This measure will drain $1.3 billion over ten years from federal coffers, and will force consumers to pay an extra $2 billion a year in higher sugar prices.
The bill invites new trade disputes: Brazil is already considering a WTO suit over the barriers to ethanol produced from sugar cane. Congress has also ignored the world's hungry, declining to soften a rule requiring the government to buy all foreign food aid from American farmers and transport it on American ships.
Most legislators probably know the farm bill is a disgrace, but they voted for it overwhelmingly anyway, revealing the cynical genius of the farm lobby. The bill's backers scared urban congressmen about losing money for food stamps, a programme contained in the bill. They scared rural ones into worrying about offending farmers. They scared Speaker Nancy Pelosi and the Democratic leadership about maintaining their House coalition, which is built on new wins in rural districts.
Resistance disintegrated when a few sops were thrown. Urban interests were promised support for the purchasing power of food stamps, which has declined since the 1990s. Ms Pelosi and other western legislators got money for fruit and nut growers. Mitch McConnell, the Senate's minority leader, even got tax breaks for the racehorse industry in his native Kentucky.
Mr Bush vetoed the measure on May 21st. But the bill won so much support in Congress that the legislative branch has enough votes to override him, thanks to Republicans voting with the Democrats against their own president. John McCain boldly voted against the bill; Barack Obama didn't. The fat cats of agribusiness can rest easy for now.
