Lawson for Congress

A poster child for bad legislation is H.R. 2419, the Food and Energy Security Act of 2007 — better known as the Farm Bill.

In a rare feat of bipartisanship, the House and Senate passed the final version last week by a veto-proof majority. Amazingly, details of this legislation are still coming to light. Given that the bill itself is 673 pages long, it’s not surprising that there wasn’t time to read it between horse trading in conference committee and the final votes.

I have four objections the Farm Bill, besides the simple fact that it is an unconstitutional disruption of our nation’s food supply, with negative global implications.

The first concern is the premise behind agricultural subsidies. We’re all familiar with rising grocery bills, and we’re feeling the impact of global commodity prices near all-time highs. The Farm Bill essentially “locks in” these high prices by setting subsidy payments for 2009 based upon today’s record levels:

Since the amount of the subsidy for 2009 is tied to recent record prices, farmers could reap a windfall if prices drop suddenly.

“I don’t think many people on the House side who voted for the farm bill realized there were $16 billion in potential higher costs in there,” said Deputy Secretary of Agriculture Charles F. Conner. “The budget exposure is tremendous.”

A blog item posted Monday by the agricultural magazine Pro Farmer described the new program, known as Average Crop Revenue Election (ACRE), as “lucrative beyond expectations,” and said it is a “no brainer” for farmers to sign up for it.

The Agriculture Department estimates that subsidy payments to corn farmers alone could reach $10 billion a year if prices — which have been $5 to $6 a bushel — were to drop to $3.25 a bushel, a level seen as recently as last year. The $10 billion figure assumes most farmers would participate in the program, a view disputed by key lawmakers.

Think about it — the government has locked in today’s high prices so that we’ll be borrowing and printing money to subsidize farmers even if prices were to decline to year-ago levels. Does that make sense?

But that’s just the impact on our country. What do these farm subsidies do to the rest of the world, and the ability of other nations to feed themselves?

LAST week, both Houses in the United States Congress passed a Farm Bill that continues the present system of high agricultural subsidies, rewarding big farmers that have already gotten much richer because of the recent hike in food prices.

This is a real pity, even a scandal, because the US farm subsidies are the main cause (together with the subsidies in Europe and Japan) of the greatest distortion in world trade.

The subsidies enable high-cost farmers and food companies to sell their products at below the cost of production and unfairly beat off the products of farmers in developing countries that don’t have the same kind of money to subsidise.

Many developing countries around the world have been importing artificially cheapened imported rice, wheat, corn, and chicken from the US and Europe.

Their own small farmers, which are often more efficient than those in the rich countries, have been displaced by these subsidised imports – one reason why agriculture has fallen in many developing countries, making them vulnerable to the present crisis of food shortages and high prices.

While our subsidies might benefit foreign consumers when prices are low, as prices have risen rapidly, developing nations’ lack of domestic agriculture leaves them exceedingly vulnerable to supply disruptions.

My third objection is Department of Homeland Security’s slipping in an unrelated power grab to bring Foot and Mouth Disease research onshore, and taking control of that transition from the Department of Agriculture:

Lawmakers on Wednesday tentatively agreed that national security officials should fully control the expected transfer of research of highly contagious foot-and-mouth disease from an offshore laboratory to the U.S. mainland near livestock.

The Bush administration requested the legal change, which would erode the traditional role of the Agriculture Department in deciding the safest location to research one of the world’s most contagious animal viruses. The virus does not infect humans but could devastate livestock herds.

House and Senate conferees, negotiating a major farm bill, agreed to the administration’s wishes to place the Homeland Security Department in full control of the transfer, according to two Senate sources who demanded anonymity because conferees were not ready to announce their agreements.

I object to moving this research in close proximity to agriculture and large population centers from its current island-based location. Regardless of my opinion, however, it is a controversial issue that deserves to be debated separately. Here’s one more reason to embrace the One Subject at a Time Act.

The final problem with the Farm Bill is the pork:

Individual lawmakers, mostly senators, slipped several dozen “earmarks,” or pet causes, into the $290 billion bill that have at best tentative connections to the tilling of the land. There’s tax breaks for horse owners, water for Nevada desert lakes, aid for the Pacific Coast salmon fishery industry and a crackdown on puppy trafficking.

Rep. Jeff Flake, R-AZ, a leading opponent of earmarks, complained that some had been “airdropped in” at the last minute. “If you dig into them, you might find something untoward. You might not, but the fact is we don’t have time to do that.”

Note Rep. Flake’s frustration about not even being able to read the bill. As a physician, if I sign off on a report or study without reading it, I could easily be sued for malpractice. Congress routinely passes legislation that is not read, nor even readable in the time provided. Congress desperately needs some help in this regard — I support the Read the Bills Act, which would require that Congress actually read legislation before voting.

The Farm Bill is expected to cost $300 billion. Our Rep. David Price voted Yes — perhaps he didn’t read it, or perhaps he erroneously believes we can afford it.

We may not be able to sue Rep. Price for malpractice, but we can certainly express our desire for change in November.

This entry was posted on Wednesday, May 21st, 2008 at 12:45 am and is filed under economic freedom, free market, free trade, inflation. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.