The Farm Bill is A SNAP

It's Not About Farmers

I contend that the Agriculture Lobby is the strongest lobby in Washington DC. No one on either side of the aisle stands up to it but we need to. My Fairtax.org friend Stephen Moore publishes a daily email and today he published a blurb on food stamps.

In April 2023, the most recent month with available figures, 41.9 million people in 22.2 million households received SNAP benefits. That’s 12.5% of the total U.S. population. Do you think there is some fraud going on here? Anecdotally, I noticed this summer in Grand Marais, MN that food prices were significantly higher than they were in Chicago, Minneapolis, Duluth, or Las Vegas. No competition and the fact that many of the people are on EBT cards causes prices to go up. EBT people are less price sensitive since the money isn’t coming out of their own savings or income.

Kill a lot of the EBT program and your prices at the grocery store will go down. I find it hard to believe that 12.5% of Americans need food stamps. This doesn’t include spending on the 10 million illegals that have come across the border since “10% Joe” got elected.

Knowing and understanding the history behind these subsidies, along with the human incentives that propel them can help us.

Food stamps became a bigger thing in the War on Poverty with Lyndon Johnson. As the bullish traders on the floor in Ag pits used to say, “People gotta eat”. As a society, we didn’t want people to go hungry.

Even the Chinese know that if they let people starve, the communists will lose power. Hence, they bought Smithfield.

If we think about how we got here, maybe we can stand up to the Farm Lobby.

The first thing to remember is that there were NO subsidies before Franklin Delano Roosevelt. Farmers were subject to the market. FDR instituted subsidies for farmers in 1933 for two reasons:

1. Curry favor with the independent farm vote. It was a political ploy.

2. Passed them under the guise of “economic theory” when it was really a way to institute centralized planning and government control.

This created a situation where the government could tell a farmer how much to plant since they controlled the purse strings on subsidies.

FDR created today’s farm lobby. David Kennedy’s excellent book Freedom From Fear delves into this. FDR was not really into the US Constitution as it was strictly written. Recall, that FDR came up with the “Four Freedoms” which allowed him and others to institute the welfare state. On balance, he was a terrible President if you are a free-market capitalist. His four freedoms were:

• Freedom of speech

• Freedom to worship

• Freedom from want

• Freedom from fear

The first two freedoms already had been enshrined into our country’s DNA at inception. The last two allowed for the government to expand and for us to be ruled by unelected bureaucrats. How does a government, OR do you even want a government freeing you from want? We saw how the government helped everyone with fear during Covid. How’d that work out?

LBJ expanded the last two “freedoms” with the War on Poverty. We have spent trillions on that war and guess what? We still have poverty. What a waste of resources.

Understand, this isn’t just about peanuts and peanut subsidies. By the way, Republicans from Georgia will go to war over keeping those subsidies and they add a significant cost to every jar of peanut butter you purchase.

The Farm Bill is a $1.5 trillion albatross of which 1.2 trillion is food stamps (over 10 years). Do you know what the lion’s share of food stamps are spent on? Sugary drinks and snacks. Hence, Coca-Cola, Pepsi, Frito Lay, and other corporations are receiving an indirect subsidy from the government. Everyone bitches about oil companies getting subsidies but they are pikers compared to Big Ag. Big Ag is the major league.

The lobbying around this bill is intense. There is $350MM dedicated to rural broadband. Does that have something to do with growing food, or should that be budgeted somewhere else?

The entire US Food Pyramid is lobbied with an eye on the farm bill.

You can go down the pyramid, and see who has the strongest lobby. Funny thing, the more carbs you eat, the fatter you become…..and the next thing you know there will be a government program for the obesity crisis.

Hint: No this photo doesn’t show a healthy person but she gets 6-11 servings of the bread group per day.

We subsidize row crops in the Farm Bill, and by making our gasoline contain ethanol. That creates a direct relationship between the price of corn and crude oil. How do you like OPEC and the Russians determining what the cost of your recommended 6-11 servings per day cost? I am sure Republican Senator Chuck Grassley thinks ethanol is saving the planet. It’s not. When Iowa elected Democrats, they didn’t think any different from Chuck. Just go east to Illinois and ask the socialist Democrats what they think about the Farm Bill. They won’t vote against it. Bobby Rush and Chuck Grassley will join hands and sing its praises.

We already know that the only thing the government can do to curb inflation is to let the free market work and cut spending. Yet, $34.7 billion is going to curb inflation! Idiots.

CRP land is non-productive farmland. If you hunt upland game, it’s a great place to find it. They call that “conservation” in the bill and they pay farmers not to farm it. It’s a small part of the Farm Bill but shouldn’t farmers decide if they want to farm it or not without an economic carrot given to them by the government?

The second thing that really irks me is subsidies.

Crop insurance can be done via private markets more efficiently and cheaper than via a government program. All you need to do is go to a CTA or an IB that understands options in the grain and other markets. Corn, Cotton, Wheat, Beans, Rice, and Barley all have competitive futures markets that will gladly take the business.

Fricking sour cherries are subsidized.

Meanwhile, Michigan growers, who dominate the nation’s tart cherry market with 72 percent of U.S. production, are pointing fingers across the globe, demanding that something must be done, and quickly, about cheap Turkish imports of cherry juice and dried cherries.

“We don’t have enough money to fight” all the challenges facing the industry, Rocko Fouch told Bridge Magazine. Fouch said he recently agreed to sell one of his orchards to a winery owner, and is trying to sell the second of his three farms. The retired math and wood shop teacher said he was fortunate to have the value in the land to offset his cherry losses.

How about you fight it out in the free market? If the Turks want to subsidize their farmers and ship cheap cherries here, who cares? They are cherries. It would be nice to go to a market and buy cheap frozen cherries so you could make a pie at home.

Virtually everything that goes in your mouth is subsidized. When John Kerry says they should subsidize bugs and fake meat, it’s over. They don’t even taste good with ketchup.