Saturday, November 20, 2010

Another Unsold Article

Why You Are Subsidizing Brazilian Cotton Farmers

The left-wing media have published a couple of astonishing stories recently that should make Americans rise up in fury and rage. If Republicans in Congress had any sense, they would grab onto these two examples of madness in government, and use them to lead a revolution against politics as usual. I just don’t have any confidence that the Republican Party has any adult supervision.

The November 6, 2010 New York Times reported on how different parts of the U.S. Department of Agriculture are spending money to defeat each other. One branch is concerned about obesity problems caused by eating high fat diets; while another branch is encouraging fast food chains to come up with more uses for cheese. They helped develop Domino’s cheese crust pizza, and an advertising campaign to promote it.

I like cheese. I like food with cheese in it. I may like food with cheese in it more than I should. I do not need the U.S. government to be spending money to encourage fast food chains to make more high fat foods. Do not lead me into temptation; I can find it perfectly fine on my own.

Now, it is true that it is only $140 million that the Department of Agriculture’s Dairy Management operation spends each year—a drop in the bucket of our nation’s deficit. And it is also true that most of this money comes from a special tax on cheese makers. But guess what? Our government also provides food assistance to the poor in this country because ... food (including cheese) is artificially expensive. There are social costs to having Americans eating high fat diets, driving up medical costs, making health insurance more expensive…so the government now needs to provide a national health insurance plan.

Spending money on one program—and then spending money on a program to counteract the first program—is crazy. Imagine if your city government had two departments: one responsible for putting out house fires—and another responsible for setting houses on fire. That’s about what the Department of Agriculture is doing: one branch is making work for the other—and both of them are wasting your money.

The November 9, 2010 NPR show All Things Considered had a story that tops even that. Some years back, Brazil sued the United States before the World Trade Organization, claiming that the U.S. government was subsidizing cotton production, to the detriment of Brazilian cotton farmers. The WTO ruled against the U.S., holding that our cotton price support system was an illegal subsidy amounting to more than a billion dollars a year.

Brazil’s response? They threatened to raise tariffs on U.S. exports to Brazil, unless we stopped this illegal subsidy of our cotton farmers. U.S. firms that sell shoes, grain, and music to Brazil, understandably, asked our government to fix this problem, so that they wouldn’t get stuck with a higher tariff. So what did the U.S. government do? Stop subsidizing U.S. cotton farmers? No, that would be logical. Now we give $147 million a year in subsidies to cotton farmers in Brazil.

Farm price supports might have made a little sense in 1935, in the midst of the Great Depression. I’m skeptical, but I am at least prepared to give the New Dealers a little benefit of the doubt. Farm price supports might be tolerable if they were going to dirt-poor farmers trying to reach a middle class level of existence. This is not the case now; the vast majority of this money is going to agribusinesses that are by no stretch of the imagination poor. But at least farm price supports are going to Americans. Here the Obama Administration has taken the absurd step of subsidizing Brazilian cotton farmers—rather than take American cotton farmers off welfare.

Do you ever get the impression that our government is run by lunatics?

1 comment:

hga said...

A note on farm price supports, and this fits right in with your "working at cross purposes" theme:

At the same time the USDA was doing everything it could to drive up the price of food, it also estimated that 1/4 of the nation was malnourished, which was largely confirmed by the WWII draft. And the poor results of the latter prompted the Federal school lunch system.