The Insanity of Our Food Policy

http://www.commondreams.org/view/2013/11/17-3

The Insanity of Our Food Policy
by Joseph Stiglitz
Published on Sunday, November 17, 2013 by the New York Times

~snip~

So it’s almost too absurd to believe that House Republicans are asking for a farm bill that would make all of these problems worse. For the putative purpose of balancing the country’s books, the measures that the House Republican caucus is pushing for in negotiations with the Senate, as Congress attempts to pass a long-stalled extension of the farm bill, would cut back the meager aid to our country’s most vulnerable and use the proceeds to continue fattening up a small number of wealthy American farmers.

The House has proposed cutting food stamp benefits by $40 billion over 10 years — that’s on top of $5 billion in cuts that already came into effect this month with the expiration of increases to the food stamp program that were included in the 2009 stimulus law. Meanwhile, House Republicans appear satisfied to allow farm subsidies, which totaled some $14.9 billion last year, to continue apace. Republican proposals would shift government assistance from direct payments — paid at a set rate to farmers every year to encourage them to keep growing particular crops, regardless of market fluctuations — to crop insurance premium subsidies. But this is unlikely to be any cheaper. Worse, unlike direct payments, the insurance premium subsidies carry no income limit for the farmers who would receive this form of largess.

The proposal is a perfect example of how growing inequality has been fed by what economists call rent-seeking. As small numbers of Americans have grown extremely wealthy, their political power has also ballooned to a disproportionate size. Small, powerful interests — in this case, wealthy commercial farmers — help create market-skewing public policies that benefit only themselves, appropriating a larger slice of the nation’s economic pie. Their larger slice means everyone else gets a smaller one — the pie doesn’t get any bigger — though the rent-seekers are usually adept at taking little enough from individual Americans that they are hardly aware of the loss. While the money that they’ve picked from each individual American’s pocket is small, the aggregate is huge for the rent-seeker. And this in turn deepens inequality.



The nonsensical arrangement being proposed in the House Republicans’ farm bill is an especially egregious version of this process. It takes real money, money that is necessary for bare survival, from the poorest Americans, and gives it to a small group of the undeserving rich, in return for their campaign contributions and political support. There is no economic justification: The bill actually distorts our economy by promoting the kind of production we don’t need and shrinking the consumption of those with the smallest incomes. There is no moral justification either: It actually increases misery and precariousness of daily life for millions of Americans.