A Republic No More by Jay Cost

Author:Jay Cost [Cost, Jay]
Language: eng
Format: epub
ISBN: 9781594037283
Publisher: Encounter Books

To put the story told in this chapter into context, it is worth revisiting a point already made. As noted previously, most of the gains from farm subsidies are to landowners who possess the property at the time the new programs are implemented. Everybody else loses because they hold elastic inputs, or because the gains are lost through higher mortgage payments. Since the farm programs were implemented in 1933, the United States has spent nearly $1 trillion in contemporary dollars in subsidies. Where has this money gone? If we follow the logic of agricultural economics, we must conclude that it has mostly gone nowhere. The original landowners from eighty years ago reaped a bounty (but still a pittance of the total sum of $1 trillion), and those who were in possession of the land when subsidies increased at various points similarly benefited to some extent, but other than that the benefits have simply evaporated. Virtually nobody was made better off by all this money.71

What makes this fact disturbing is that there is very little disagreement on this point, at least among those who do not have a direct interest in this or that provision of the farm bill. Disinterested economists now tend to agree that the farm bill is worse than useless; it actually harms the public good. And yet it is unable to be repealed. Even when Congress has come close to major reforms, like the 1996 FAIR Act, it never can seem to follow through. At the first sign of “hardship” for (relatively wealthy) farmers, it folded like a deck of cards, handing over more money than had been given in years.

Why? The answer is exactly the thesis we are defending in this book: the government was never designed to implement a policy such as this. Instead, the government was a compromise between various political groups extant in 1787; some wanted virtually unlimited federal power while others wanted to retain (more or less) the status quo under the Articles of Confederation, so they split the difference by creating a government of expanded, yet still discrete powers. Importantly, they built a structure to manage those powers and those powers alone. Yet generation after generation has seen fit to expand the powers of government without altering the structure to handle the new tasks responsibly. Now we simply ask too much of the government, and when we do that, it disappoints us.

In the case of farm subsidies, it is simply asking too much of this government to deal fairly with a program such as this. Even if we admit the economic case for a limited, or substantially reformed, version of farm subsidies, this government in particular could not execute it well at all. It would manage it to the interests of the well-connected and well-off, just as the New Dealers did with the AAA. It would resist commonsensical reforms, just as generations of postwar politicians did. If it did suddenly discover the courage to fix the programs, it would shrink from those reforms at the first sign of trouble, just as happened with the FAIR Act.

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