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Washington experts should get outside the Beltway

May 8, 2007 11:00 AM

It must be fun to sit in an office in Washington and dream up zingers like “Milking the Customers: The High Cost of U.S. Dairy Policies,” or “Ripe for Reform: Six Good Reasons to Reduce U.S. Farm Subsidies and Trade Barriers.”

Those are papers written by Sallie James, policy analyst, and Daniel Griswold, director of the Cato Institute’s Center for Trade Policy Studies. Their aim: to help dismantle the farm programs Congress has enacted over the past 60 years.

I don’t know James or Griswold. But I suspect neither has any idea what it’s like to slog through a rice field looking for diseases or bale 1,000 acres of hay. Yet, both seem certain they have all the answers on farm policy issues.

“Agricultural policy in the United States is interventionist, expensive, inequitable and damaging to American interests abroad,” they write in their latest tome, “Freeing the Farm: A Farm Bill for All Americans.” “Over the last 20 years, the opportunity cost to consumers and taxpayers of supporting agricultural producers has totaled $1.7 trillion.”

Removing import barriers, they say, “will provide cheaper food for consumers and inject competition into agricultural markets. Democrats took Congress partly by criticizing fiscal irresponsibility. Dismantling farm income support programs is an opportunity to make good on the promise to make changes for the better.”

Griswold and Bob Young, chief economist for the American Farm Bureau Federation, have been debating farm policy issues on the Cato Institute Web site (http://www.freetrade.org).

Young’s reasoned arguments offer a nice contrast to such natterings by Griswold that “U.S. farm programs transfer about $40 billion a year from consumers, firms and taxpayers to a small group of farmers” and “Tariffs and quotas on imported sugar, rice and dairy products force American families to pay $10 billion a year above world prices.”

In their farm bill proposals, Farm Bureau economists noted the Congressional Budget Office projects commodity program spending will average $7 billion per year for 2008 to 2013. This translates to $23 per American per year or 6 cents per day.

Griswold calls that estimate “the kind of wishful thinking that accompanies every budget projection. A fall in global commodity prices would send that number soaring, as it did in the 1990s.”

Well, duh. That’s been the idea behind farm programs since they were first initiated. They allow farmers to continue providing food and fiber when weather, embargoes or currency manipulations have dropped prices or yields below any hope of profitability.

Griswold’s claim farmers should rely on markets to match supply and demand sounds like someone who has never watched farm prices go limit down for days on end, wiping out billions of dollars in farmer equity.

Washingtonians pay two and three prices for food so they don’t know what a bargain most of us receive. Someone in the Mississippi Delta or central Iowa should invite Griswold to come see what how the world really works.

e-mail: flaws@farmpress.com