Ag Reform Bill, At $969 Billion, Is A Mammoth Waste

| July 12 2012

By REP. DAVID SCHWEIKERT

Although our friends in the U.S. Senate routinely dismiss commonsense solutions to our fiscal crisis, they have shown little resistance in considering an expensive 1,010-page farm bill.

Dubbed the Agriculture Reform, Food and Jobs Act of 2012, this $969 billion monstrosity speaks to exactly why the American people sent us to Washington: To stop the spending, waste and corruption.

Only in Washington could this bill be considered fiscally responsible.

Despite the fact the Senate cosponsors claim this farm bill could save $23.6 billion over the next decade, the actual 10-year cost of this bill dwarfs the 2008 farm bill at a CBO-projected $604 billion.

It does not take an economist to note that a 62% increase in spending while we approach $16 trillion in debt is simply unsustainable.

In addition to its bloated numbers, this bill includes an endless parade of special interests.

Washington is picking winners and losers through a combination of price controls, import restrictions, subsidies and cash payments; and it reeks of corporate welfare in an era of record-high farm incomes and record-low debt ratios.

Loser Subsidies

Compounding these problems, the Senate has proposed a new crop insurance subsidy known as “shallow loss” that effectively creates a 90% revenue guarantee. What other industry gets a 90% revenue guarantee? 

With that kind of safety net in place, it would not be hard to envision a scenario where the system is abused. What incentive would farmers continue to have to work hard and contribute to the food supply when their risk is removed and their profit ensured?

Moreover, a government safety net removes private competition from the marketplace and with it any hope of fostering economic growth.

Government intervention in the mortgage industry, the real estate industry, in health care, and in farming has sapped the ability of private enterprise to compete with a massive organization that has millions of taxpayers to generate revenue from, not to mention the freedom to take out unsustainable loans and print its own currency.

This administration has made a habit of doling out corporate social welfare, and robbing our economy of the chance to heal. That said, the most egregious problems with the farm bill have absolutely nothing to do with farming.

Eighty percent of farm bill spending goes to the Supplement Nutrition Assistance Program, or food stamps.

And like most programs that have their roots in the New Deal and the Great Society, this one has grown exponentially.

In the 1970s, just one in 50 Americans received food stamps. Today, that number is one in seven, or more than 46 million Americans — that is 15% of the U.S. population.

The cost of the program doubled between 2001 and 2006 and again from 2008 to 2012. Taxpayers now spend $80 billion a year on food stamps, a level the Senate bill would lock in for the next decade.

Culture Of Dependency

Thanks to the stimulus, misaligned incentives for states, and a consistent weakening of eligibility criteria, we are in the midst of a dependency crisis.

This is a huge victory for liberals. By inserting food stamps into an agriculture bill, it makes it nearly impossible to pass common sense reforms to either.

The first step in long-term farm bill reform is to split agriculture away from food stamps and let each provision stand or fail on its own merit.

In 2010, Americans sent reinforcements like me to the people’s House to ensure we did not repeat the mistakes of the past.

While our friends in the Senate do not appear to have learned that lesson, the House must stand firm and unequivocally oppose any farm and food bill that does not restore free market principles to our agriculture system and rein in America’s bloated food stamp program.

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