President Obama was in Michigan last week to sign a 10-year, $1 trillion farm bill. While much of the debate has centered around the spending on food stamps, buried in the 1,000-page plan are many other provisions that are indefensibly bad policy.
While some are praising, and others complaining, about slightly rolling back spending on food stamps and eliminating some of the direct payments to "farmers" (who did not actually farm), the bill goes far beyond that. This bill continues special subsidy deals to farmers in every area in the country — from corn and beans to rice and peanuts to sugar and catfish.
The farm bill also pays 62 percent of the premiums for crop insurance costing billions annually. The program is administered through 18 private companies.
According to The New York Times, "Crop insurers scored a major victory from a provision in the bill that bars the Agriculture Department from renegotiating lesser payments to those companies over the … life of the bill. In previous years, the Agriculture Department's renegotiations with insurance companies have resulted in billions of dollars in savings for the government."
While the Congressional Budget Office said the bill will reduce federal spending by $16.6 billion, the R Street Institute, a free market think tank with its headquarters in Washington, D.C., said only $8.6 billion of that comes from trimming farm subsidies. Comparably, the 2014 White House budget wanted $37.8 billion in net cuts to farm subsidies. So the GOP, which provided most of the votes on this bill, soon will be campaigning on fiscal prudence, but could not manage to cut less than the president.
"The Obama administration is not exactly known for austere budgets, so the fact that the White House would cut $29.2 billion more in wasteful agriculture spending than the farm bill Congress approved underscores just how terrible this legislation is," said R Street Senior Fellow Andrew Moylan, in a press release.
The Economist noted that the bill is a 50 percent increase in spending over the 2008 law, with 80 percent going to spending that has nothing to do with farming.
The median farm household income is 25 percent higher than the national average and 75 percent of the subsidies in the bill go to the largest 10 percent of farm businesses. In practical terms, this means the rest of society is subsidizing wealthy agriculture companies.
Among Michigan's Congressional delegation, the bill was supported by Sens. Debbie Stabenow, D-Lansing; and Carl Levin, D-Detroit.
In the House, it was supported by most representatives on both sides of the aisle: Reps. Dan Benishek, R-Iron River; Bill Huizenga, R-Zeeland; Dave Camp, R-Midland; Dan Kildee, D-Flint; Fred Upton, R-St. Joseph; Tim Walberg, R-Tipton; Mike Rogers, R-Howell; Candice Miller, R-Harrison Township; John Dingell, D-Dearborn; and Gary Peters, D-Bloomfield Hills.
The four representatives who voted against the bill were: Reps. Justin Amash, R-Cascade Township; Sander Levin, D-Royal Oak; John Conyers, D-Detroit; and Kerry Bentivolio, R-Milford.
Republicans who were opposed to the massive far bill said they were against it for spending reasons while the Democrats said they were opposed because of the cuts to food stamp cuts.
"This is not your father's farm bill," said Sen. Stabenow, chair of the Senate Agriculture Committee, who co-wrote the bill, in a press release.
It's certainly not, nor your grandfather's. While the American economy was once mostly families working in agriculture, today many of the people and businesses that farm are much larger and wealthier. And yet we continue to give them hundreds of billions of dollars in subsidies. And much of the spending goes to an increasing number of federal programs and bureaucracy rather than the family farm.
Today, the annual budget of the Department of Agriculture exceeds the net incomes of all U.S. farmers.
Agriculture still is an important part of our economy, and there are many people working land that has been in their families for generations. But few industries, if any, get the special subsidies and deals doled out to Big Agriculture.
These favors are given to a growing number of industries in more and more states, making the farm bill a "Christmas tree budget" filled with gifts to please the beneficiaries, bureaucrats and politicians involved. But taxpayers are much worse off.
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$1 Trillion Farm Bill Full of Subsidies, Special Favors
Majority of Michigan GOP delegation voted for it
President Obama was in Michigan last week to sign a 10-year, $1 trillion farm bill. While much of the debate has centered around the spending on food stamps, buried in the 1,000-page plan are many other provisions that are indefensibly bad policy.
While some are praising, and others complaining, about slightly rolling back spending on food stamps and eliminating some of the direct payments to "farmers" (who did not actually farm), the bill goes far beyond that. This bill continues special subsidy deals to farmers in every area in the country — from corn and beans to rice and peanuts to sugar and catfish.
The farm bill also pays 62 percent of the premiums for crop insurance costing billions annually. The program is administered through 18 private companies.
According to The New York Times, "Crop insurers scored a major victory from a provision in the bill that bars the Agriculture Department from renegotiating lesser payments to those companies over the … life of the bill. In previous years, the Agriculture Department's renegotiations with insurance companies have resulted in billions of dollars in savings for the government."
While the Congressional Budget Office said the bill will reduce federal spending by $16.6 billion, the R Street Institute, a free market think tank with its headquarters in Washington, D.C., said only $8.6 billion of that comes from trimming farm subsidies. Comparably, the 2014 White House budget wanted $37.8 billion in net cuts to farm subsidies. So the GOP, which provided most of the votes on this bill, soon will be campaigning on fiscal prudence, but could not manage to cut less than the president.
"The Obama administration is not exactly known for austere budgets, so the fact that the White House would cut $29.2 billion more in wasteful agriculture spending than the farm bill Congress approved underscores just how terrible this legislation is," said R Street Senior Fellow Andrew Moylan, in a press release.
The Economist noted that the bill is a 50 percent increase in spending over the 2008 law, with 80 percent going to spending that has nothing to do with farming.
The median farm household income is 25 percent higher than the national average and 75 percent of the subsidies in the bill go to the largest 10 percent of farm businesses. In practical terms, this means the rest of society is subsidizing wealthy agriculture companies.
Among Michigan's Congressional delegation, the bill was supported by Sens. Debbie Stabenow, D-Lansing; and Carl Levin, D-Detroit.
In the House, it was supported by most representatives on both sides of the aisle: Reps. Dan Benishek, R-Iron River; Bill Huizenga, R-Zeeland; Dave Camp, R-Midland; Dan Kildee, D-Flint; Fred Upton, R-St. Joseph; Tim Walberg, R-Tipton; Mike Rogers, R-Howell; Candice Miller, R-Harrison Township; John Dingell, D-Dearborn; and Gary Peters, D-Bloomfield Hills.
The four representatives who voted against the bill were: Reps. Justin Amash, R-Cascade Township; Sander Levin, D-Royal Oak; John Conyers, D-Detroit; and Kerry Bentivolio, R-Milford.
Republicans who were opposed to the massive far bill said they were against it for spending reasons while the Democrats said they were opposed because of the cuts to food stamp cuts.
"This is not your father's farm bill," said Sen. Stabenow, chair of the Senate Agriculture Committee, who co-wrote the bill, in a press release.
It's certainly not, nor your grandfather's. While the American economy was once mostly families working in agriculture, today many of the people and businesses that farm are much larger and wealthier. And yet we continue to give them hundreds of billions of dollars in subsidies. And much of the spending goes to an increasing number of federal programs and bureaucracy rather than the family farm.
Today, the annual budget of the Department of Agriculture exceeds the net incomes of all U.S. farmers.
Agriculture still is an important part of our economy, and there are many people working land that has been in their families for generations. But few industries, if any, get the special subsidies and deals doled out to Big Agriculture.
These favors are given to a growing number of industries in more and more states, making the farm bill a "Christmas tree budget" filled with gifts to please the beneficiaries, bureaucrats and politicians involved. But taxpayers are much worse off.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.
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