The federal government began formulating agricultural policy in 1794, when the residents of western Pennsylvania started the Whiskey Rebellion in response to an excise tax on corn liquor. The agricultural policy formulated in 1794 was to shoot farmers. In this case, the federal government may have had it right the first time.
Like most Americans nowadays, my experience with agriculture is pretty much limited to marijuana plants under a grow light in the closet of my off-campus apartment. I did, however, once help artificially inseminate a cow.
I had this half-baked friend, a complete city slicker, who—out of the blue—decides he’s going to raise cattle. So he buys a farm and he buys some cows. And I’m up visiting him when it’s time for the cows to get in a family way.
Now this is not done like I might have thought, with a cow and a bull in a heart-shaped stall and some Barry White tape cassettes. It turns out breeding cattle is like teenage pregnancy but more so. Not only isn’t the bull around to help raise the calf, he’s not even there to get the cow knocked up.
What happens instead is there’s this liquid nitrogen thermos bottle full of frozen bull semen. (Let’s not even think about how they get that.) And there’s this device that looks like a giant hypodermic needle …
Anyway, my friend got this real farmer, Pete, to come in and actually do the honors.
So, while I’m holding the cow’s head and my friend is holding the cow’s middle, Pete takes this freezing cold syringe thing and inserts it into a very personal and private place of the cow’s.
Then what Pete does is he sticks his arm into an even more personal and private place of the cow’s—all the way up to the elbow.
Now, Pete does this not to make a pornographic beastiality video, but so that he can feel the tip of the inseminator tube through the cow’s intestine wall and guide that tip into the cow’s uterus.
It was a pretty gruesome thing to watch and, since I was up at the cow’s other end, I’m glad to say I didn’t watch it.
But I’ll tell you one thing—I will never forget the look on that cow’s face.
It was the same look that I got on my face—for the same reason—when I read the 1990 omnibus farm bill.
Every five years or so the U.S. Congress votes on a package of agricultural legislation that does to the taxpayer what Pete did to the cow.
The last farm bill cost American taxpayers over $100 billion in direct out-of-our-paycheck-into-the-feed-bag costs and another $50 billion in higher prices we paid at the supermarket. This was the Food Security Act of 1985. “Yes, officer, the stereo, the TV, and the coin collection are gone but, thank God, the refrigerator wasn’t raided.”
The new farm bill will only cost about $50 billion, although there’s no telling what any farm bill is really going to cost. The 1981 farm bill was budgeted at $12 billion and ended up costing $60 billion, and the 1985 bill was supposed to represent a substantial cut in 1981 allocations.
You see, if the weather’s bad and we have lots of droughts and freezes, we’ll have to give disaster aid and crop-insurance payments to farmers, and the farm bill will end up costing us more. On the other hand, if the weather’s good and we have plentiful harvests, we’ll have to buy up surplus commodities and pay farmers to cut down on planting, and the farm bill will end up costing us more. And if—God forbid—the weather is good some of the time and bad some of the time—if, in other words, the weather is normal—then we can all just start backing toward the barn door and mooing for frozen bull sperm.
But all this money goes to poor farmers laboring from sunup to sundown on millions and millions of farms across the nation, doesn’t it?
No.
In the first place, there aren’t millions and millions of farms in America. There are about two million if you use the very inclusive Bureau of Census definition of a farm as any place with $1,000 or more annual gross sales of farm products. My off-campus apartment closet would have qualified if the grow lights hadn’t blown the fuse box. There are, in fact, only about 314,000 full-time commercial farms in the U.S. These are farms that have gross annual sales of over $100,000. These are also the only farms where farm income exceeds income from nonfarm sources, such as factory jobs, retirement benefits, or sticking up 7-Eleven stores.
Nor are farmers, in general, poor. Farm-family income has exceeded average family income in America for more than twenty-five years. And federal farm spending doesn’t go to poor farmers, anyway. The largest farms in America, those with gross receipts of more than $500,000, receive 60 percent of all price-support money.
So what are our Department of Agriculture tax dollars buying for us? A Department of Agriculture. The USDA has 106,000 employees, one for every three full-time farms in the country.
These 106,000 people would be more useful to the farm economy if we sent them out to hoe weeds. But they can’t go; they’re too busy doing things like administering the Federal Wool and Mohair Program. According to the U.S. General Accounting Office report to Congress on the 1990 farm bill, “The government established a wool and mohair price-support program in 1954 … to encourage domestic wool production in the interest of national security.” Really, it says that. I guess back in the fifties there was this military school of thought that held that in the event of a Soviet attack we could confuse and disorient the enemy by throwing blankets over their heads. Then, while they were punching each other in the dark and trying to figure out who turned the lights off, we’d have time to run into our missile silos and destroy Russia with ICBMs. From 1955 to 1980, $1.1 billion was spent on wool and mohair price supports, with 80 percent of that money going to a mere six thousand shepherds and (I guess) moherds. This is $146,400 per Bo Peep. And, let me tell you, she didn’t lose those sheep. They’re off at boarding school in Switzerland.
Then there’s the U.S. Honey Program, instituted in 1952 to stabilize honey prices (you remember how the American economy was almost brought to its knees by wild swings in the price of honey) and to “maintain sufficient bee populations for pollinating food and fiber crops.” The honey program spends $100 million a year on about twenty-one hundred beekeepers—more than $47,000 each. For that kind of money, hell, I’ll go sit in the flowers and wiggle around and get pollen all over my butt.
James Bovard, policy analyst at the libertarian Cato Institute and author of the book The Farm Fiasco, notes that between 1985 and 1989 government spending on rice farms was equal to $1 million for every full-time rice farmer in America and that the annual subsidy for each American dairy cow is between $600 and $700—greater than the per capita income of half the world’s population.
Walter Williams, an economics professor at George Mason University, points out that since 1985 federally mandated attempts to boost citrus prices have resulted in the destruction (or use as cattle feed) of three billion oranges and two billion lemons (which explains why we so rarely hear about a cow with scurvy).
And Congressman Dick Armey, in an article for Policy Review entitled “Moscow on the Mississippi: America’s Soviet-Style Farm Policy,” says the 1985 farm bill paid farmers not to farm sixty-one million acres—an area equal to Ohio, Indiana, and half of Illinois—and that the amount we’ve spent on farm subsidies in the past ten years is enough to have bought all the farms in thirty-three states.
“Moscow on the Mississippi” is an apt phrase. U.S. farm policy is coercive, collectivist, and centrally planned and has been since 1929, when that wild radical Herbert Hoover created the Federal Farm Board in an attempt to corner the commodities market and control farm prices.
The New Deal successor to the Federal Farm Board was the Commodity Credit Corporation, or CCC, one of the Roosevelt era’s Goldilocks programs, so-called because it barged in on the taxpayer fifty years ago, and it’s still there. The CCC is empowered by its 1933 charter to “undertake activities for the purpose of increasing production, stabilizing prices, and insuring adequate supplies; and to facilitate the efficient distribution of agricultural commodities.” A more Brezhnevian set of instructions to a government agency is hard to imagine.
U.S. farm policy is, along with North Korea and the Stanford liberal arts faculty, one of the world’s last outposts of anti–free market dogmatism. Congressman Kika de la Garza, who is the exasperatingly powerful chairman of the House Agriculture Committee, wrote in the Capitol Hill newsletter, Roll Call, that “most Americans believe the unique nature of agriculture—the lengthy production cycle, dependency on the weather, susceptibility to price swings, etc.—justifies a certain level of government involvement.” But you can say the same thing about the unique nature of selling Mazda Miatas. Why isn’t the government giving $50 billion to car dealerships?
A GAO report on federal dairy policies contains this sentence: “The federal government first developed dairy policies when low milk prices appeared to threaten the adequacy of the nation’s milk supply.” Which is insane. Everybody from wife-bartering savages to Michael Milken knows that low prices mean surplus, not shortage. Yet this statement appeared in a GAO report criticizing the federal dairy programs for not being “market oriented.” Meanwhile, the dairy farmers themselves, through their lobbying organization, Dairymen, Inc., issue position papers that sound like extracts from Albanian newspaper editorials: “Dairymen enthusiastically supports a strong and flexible federal milk marketing order program. Such a program is essential for the maintenance of orderly marketing of milk in fluid and manufactured dairy product markets.”
Thus, while America was fighting Commies all over the world, communism grew apace in our own back forty. American farm policy is exactly what, during the McCarthy era, people were jailed, fired, and blacklisted for advocating in this country—unless, of course, they were American farmers.
This being America, we haven’t pursued Marxist goals with tanks, secret police, and gulag camps; we’ve used money. And the result has been a uniquely American totalitarian screw-up. Instead of terrible shortages, we’ve created gross overproduction. Instead of making people dirt poor, we’ve made them filthy rich.
As with anything that’s had too much attention from the government, farm policy is a mess and a tangle, an immense dog’s breakfast of programs, laws, and regulations. The farm policy briefing package prepared by the Library of Congress for U.S. senators and representatives begins with a “Glossary of Agricultural Terms” forty pages long.
But farm policy, although it’s complex, can be explained. What it can’t be is believed. No cheating spouse, no teen with a wrecked family car, no mayor of Washington, D.C., videotaped in flagrante delicto has ever come up with anything as far-fetched as U.S. farm policy.
To begin with, there is the concept of parity—the deep thought behind all of the USDA’s price- and income-support measures. Parity is the idea that the price farm goods bring ought to be the same, now and forever, in inflation-adjusted dollars, as the price farm goods brought in the years 1910 through 1914. Parity was conceived in the twenties, when increased mechanization and better seeds and fertilizers were causing agricultural prices to fall. Farmers liked the fact that they could grow more stuff. But they didn’t like the fact that other farmers could grow more stuff, too, and that all the stuff being grown was therefore less rare and valuable. The farmers wanted the calendar turned back to those golden pre–world war days, when—as they remembered it—a peck of wheat sold for a bushel of money, and every load of manure was pitched by a hayseed Vanderbilt.
The U.S. government is a sort of permanent frat pledge to every special interest in the nation—willing to undertake any task no matter how absurd or useless. So our government obliged the farmers, or tried to, and parity was born.
If we applied the logic of parity to automobiles instead of feed and grain, a typical economy car would cost forty grand; $43,987.50 is what a 1910 Nash Rambler cost in 1990 dollars. And for that you got a car with thirty-four horsepower, no heat, no A/C, no tape deck or radio, and no windows. If farm parity were a guiding principle of human existence, we’d not only have lousy, high-priced economy cars, we’d have a total lack of civilization. Cheap, plentiful food is the precondition for human advancement. When there isn’t enough food, everybody has to spend all his time getting fed and nobody has a minute to invent law, architecture, or big clubs to hit cave bears on the head. Agriculture prices have been falling, relative to the prices of other goods and services, not since the 1920s, but since the Paleolithic age. And it’s a good thing. Otherwise we wouldn’t grow food, we’d be food.
The government has any number of ways of inflicting parity on taxpayers and food shoppers. For example, there’s the “nonrecourse loan.” This is a loan farmers can get from the government using their crop as collateral. But the government sets the value of that collateral not by the crop’s price but by what the crop’s price ought to be in a dream world full of parity and happy farmers. Say wheat is selling for $3.50 a bushel, but the USDA thinks farm life would be a more fulfilling experience if the price were $4. So the USDA sets the “nonrecourse loan rate” at four bucks, and farmers can get a loan of $4 for every bushel of wheat they’ve got lying around. Then if America happens to suffer a terrible outbreak of toast weevils and the price of wheat goes up to $10 a bushel, farmers can pay back their $4 loans, sell the wheat for $10, and bank the profits.
But if everybody in the United States suddenly goes on an all-meat diet and the price of wheat drops to fifteen cents, the farmers can blow off the loans, make the government eat the wheat, and not even get an ink smudge in their credit histories. It’s an absolutely no-risk business transaction, like doing real estate deals with your dog. “Beach front? You don’t want beach front, Fido. I’ve got some prime dumpside acreage, chicken bones and dead rats all over the place. I’ll trade you straight up.”
Or if a nonrecourse loan is too complicated for the farmer, the government has another program, called “loan-deficiency payments.” In this program the government pays the farmer not to take a nonrecourse loan.
The “conservation reserve program” is almost as simple. The government gives annual payments to the farmer in return for the farmer removing highly erodible land from production—as if erosion weren’t doing that already. A farmer on the conservation reserve program will doubtless want to be on the “acreage conservation program,” too. That way the government will pay him up to $3,500 a year to practice soil conservation in general. This is like going into a Dairy Queen and giving the owner money to keep his ice cream freezers plugged in.
“Marketing orders” are used to keep farm prices high at the retail level. The growers of various commodities are encouraged to get together and fix the price for which their commodities will sell. In other industries there’s a name for people who do this: felons. Some marketing orders are enforced by “marketing quotas.” Growers decide how much growing each grower can do. If shoeshine boys tried this, you’d only get one loafer polished during shine-business slumps.
During the mid-1980s the dairy industry had its own plan to limit production, the “whole herd buyout.” Dairy farmers decided there was too much cheap milk at the supermarket. Hell, even homeless welfare babies were drinking moo juice. So the government bought and slaughtered 1.6 million dairy cows. How come the government never does anything like this with lawyers?
Farm-product bargains are also eliminated by means of the “commodity import program.” Our government gives foreign governments grants and loans to buy stuff grown in the U.S., stuff that would otherwise be a glut on the domestic market. I guess we should be thankful that similar programs have not been undertaken by the governments of Colombia, Bolivia, and Peru.
While some government programs are making farm products more expensive to buy, other programs are making farm products cheaper to produce. For example, farmers get cut-rate credit to the extent that the federal government now controls half of all farm debt. Farmers also get subsidized crop insurance. And, for those farmers who didn’t feel like buying subsidized crop insurance but had a crop failure anyway, there are free disaster benefits.
This conflict between policies that send prices up and policies that drive prices down results in the need for a third category of policies that do nothing at all. These are the famous programs that give farmers money for not farming. In the “payment-in-kind program” the farmer is given the excess farm products that other farmers grew in return for not growing any of his own. In the “paid acreage diversion program” the more farming the farmer doesn’t do, the more the government pays him. And in the best program of all, “0/92,” the farmer does absolutely nothing and gets 92 percent of all the payments and benefits he could have possibly gotten from the largest crop he could have possibly grown. A USDA scheme like this gives every government agency something to shoot for. With 0/92 as an inspiration, Health and Human Services will probably dream up a way for us taxpayers to catch clap from whores without getting laid.
Just when you think the farm issue can’t get sillier, here comes Willie Nelson pounding on the gut fiddle and adenoidaling away at Farm Aid. Yes, Willie and such thoroughly improbable acts as L. L. Cool J, Guns N’ Roses, Iggy Pop, and Lou Reed (hey, there’s a bunch of sheep in fishnet stockings out here, they’ve got drugs, and they say they’re with the band) have raised a few more bucks for the farmers who just euchred Congress out of $50 billion.
There are farm families in need of charity, of course. But singling out farmers and getting all soggy-nosed and soak-eyed over their plight has less to do with facts than with romantic nostalgia for a pastoral ideal that never existed. Throughout history farm life has been brutish, dirty, and mostly stupid. Not that any of us would know. This country is so urbanized we think low-fat milk comes from cows on Nutri/System weight-loss plans.
According to the Statistical Abstract of the United States, about 1.3 million people in America define themselves as farmers. But there are 4.1 million secretaries. These secretaries are poorly paid, hold jobs that provide little satisfaction or chance for advancement, are frequently working mothers, and often the sole support of their families. Where’s the “Lend a Short Hand” concert for them? Where are the famous ode-yodelers singing “Momma Was a Hard-Typing Gal”? Why’d farmers get cinematic encomiums like The River, Country, and Places in the Heart while secretaries got nothing but Nine to Five?
Farming has always carried emotional freight. Thomas Jefferson, caught in a moment of rare idiocy arguing against the industrialization of the United States, said, “Those who labor in the earth are the chosen people of God … whose breasts He has made a peculiar deposit for substantial and genuine virtue.” This, by the way, from a gentleman farmer who owned two hundred slaves and kept at least one of them as his mistress.
The farm lobby makes good use of such lofty forms of nonsense and, also, of less lofty forms of nonsense, such as congressmen. For instance, sugar growers donate about half a million dollars a year to congressional election campaigns, and the dairy industry donates $2 million. Even though only 46 out of 435 congressional districts are controlled by farm votes, farmers have gained heavy leverage on Capitol Hill by combining rhetoric, ready money, and a talent for political logrolling that dates back to the Constitutional Convention, when Southern farmers managed to get slaves counted as three-fifths of a voter without letting any slaves do three-fifths of the voting. As a result of this disproportionate influence, 25 percent of the net income U.S. farmers receive is in the form of direct cash payments from the government. The only other businessmen who put this kind of lip clamp on the public teat are defense contractors. And at least when we give billions to defense contractors, we get something back for it, Star Wars or something. Maybe we don’t need Star Wars, maybe it doesn’t work, but at least the defense contractors were thinking of us. They made, you know, a gesture. But we give billions to farmers and don’t even get a basket of zucchini on the front porch.
Our that-ain’t-hay farm policy is useless. Even Willie Nelson acknowledges that four hundred thousand small farms have gone out of business since he began giving his Farm Aid concerts, and I don’t think we can blame all four hundred thousand on Willie’s awful music. A 1988 Government Accounting Office report concluded that one quarter of the bankruptcies among Farmers Home Administration borrowers were the result not of any credit crunch, but of an excess of cheap, subsidized loans.
Agricultural economist Clifton B. Luttrel estimates than an old-fashioned money-vomiting Great Society–style welfare system to keep needy farmers in business would cost only $4 billion a year, less than half what current programs cost.
I went to see Pete, the dairy farmer who’d helped my friend get his cow pregnant. Pete’s family has been dairy farming in New England all this century, and dairy farmers, as a group, have been on the receiving end of great federal largess—on the order of $6 billion to $7 billion a year. Pete, however, had just sold his cows and was subdividing his land to build vacation homes. I had a very short interview with Pete.
Me: As the result of price supports, product purchases, marketing orders, and other federal dairy programs, how much better off are local dairy farmers?
Pete: There are only two local dairy farmers left.
Me: Are they better off?
Pete: Nope.
U.S. farm policy, besides not doing what it’s supposed to, does do what it isn’t supposed to, and lots of it—the law of unintended consequences being one piece of legislation Congress always passes.
Many farm-program payments are doled out according to an “acreage base.” This is the amount of land on a farm that’s planted in a particular crop. In order to protect their acreage base and continue getting government payoffs, farmers are forced to practice “monocropping”—planting the same thing every year instead of rotating crops to replenish soil nutrients. Monocropping requires more chemical fertilizers, which pollute groundwater, and more pesticides and weed killers, which cause severe side effects, such as Meryl Streep appearing in front of congressional committees to complain about what’s in her food.
The acreage-base system also discourages experimentation with new crops, such as canola (vegetable oil) and kenaf (paper pulp), both of which show enormous potential as dinnertime child disciplinary threats. (“No TV until you finish your kenaf.”)
Other farm-program benefits, such as “deficiency payments,” are paid on the basis of yield rather than acreage. The more you grow, the more you get paid. Yield-based deficiency payments for feed corn, combined with disaster payments based on yield projections, encourage farmers in drought areas to plant the highest yielding varieties of corn rather than the varieties that are most drought resistant. Meanwhile, wind erosion blows the top three inches of North Dakota into downtown Duluth.
Farm programs even make American foreign policy more screwed up than it is already—not an easy thing to do. The USDA sugar program spends a quarter of a million dollars per year per American sugar grower. This to keep the sugar industry healthy in a climate unsuited to producing sugar. These subsidies and the sugar-import quota that goes with them cost sugarcane-growing U.S. allies such as the Philippines more than $800 million a year in lost revenues. That’s $319 million more than we pay the Philippines to rent our military bases there.
And while the USDA is spending $10 billion a year to increase farm income, the same government agency is spending $20 billion to make food affordable to poor people through the Food Stamp program. A moron, an imbecile, an American high school student can see there’s something wrong with this equation. Just give the $10 billion to the poor people, and let them buy their own damn food from the farmers.
I spent two and a half years examining the American political process. All that time I was looking for a straightforward issue. But everything I investigated—election campaigns, the budget, lawmaking, the court system, bureaucracy, social policy—turned out to be more complicated than I had thought. There were always angles I hadn’t considered, aspects I hadn’t weighed, complexities I’d never dreamed of. Until I got to agriculture. Here at last is a simple problem with a simple solution. Drag the omnibus farm bill behind the barn and kill it with an axe.