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See the latest reader comments and hear John explain some of agriculture’s complex topics.
Sharing the Budget Cutting Pain
Jun 07, 2011
John, you mentioned the traditional subsidies paid to farmers kind of like business as usual, but questioned whether this is really necessary ongoing. I agree, especially in these times of record-high prices of commodities. For Vilsack to indicate to Congress that we all need to share in the pain of cuts, but USDA has borne a greater share of cuts than other departments is not meaningful. USDA has a huge budget. Are the cuts greater in dollars or percentagewise? On the other hand, so what? When times are robust for farmers now, it is foolish to continue subsidies that are exorbitant. Rather, that creates a common sense opportunity to make cuts because they will not be felt now. This does not mean there are no subsidies in the future but it is looking at reality and trying to set priorities, since typically no one group offers any cuts. This requires strong backbones as all special interest groups crowd around the trough.
Thanks, and I love your show. You guys do a great job! I enjoy your personal commentary, too, John. Roger Shipp - Eden Prairie, MN
***Editor's Note: Below is a transcript of John's comments referred to in the viewers comments...
THE PROCESS OF WRITING A NEW FARM BILL HAS BEGUN AGAIN IN A NEW AND RATHER HARSH POLITICAL CLIMATE. MOST FARM BILL SUPPORTERS ACKOWLEDGE THERE WILL BE CUTBACKS, BUT THERE THE CONSENSUS ENDS.
BEFORE WE GET TOO FAR INTO THIS DEBATE, I WOULD LIKE TO TACKLE TWO OVERUSED ARGUMENTS THAT CONTRIBUTE LITTLE. THE FIRST IS THE IDEA THAT AG SHOULDN'T SEE LARGER PERCENTAGE CUTS THAN OTHER SECTORS OF THE FEDERAL BUDGET.
THE IDEA IS MISTAKENLY BASED ON THE ASSUMPTION THAT ALL USES OF FEDERAL DOLLARS ARE EQUALLY IMPORTANT AND NECESSARY. FOR DIRECT PAYMENTS TO CROPS NOW SEEING RECORD PRICES THIS IS HARD TO JUSTIFY. BUT IT ALSO MEANS THE DISTRIBUTION OF FEDERAL DOLLARS IN THE CURRENT BUDGET IS THE GOLDILOCKS SOLUTION - JUST RIGHT AS IT IS. AGAIN THIS IS ILLOGICAL.
THE SECOND STANDARD DEFENSE FARM SUBSIDIES IS THEY ONLY CONSTITUTE A TEEENSY PORTION OF THE FEDERAL BUDGET. THIS IS TRUE, BUT IF THAT EXCUSES $25 BILLION DOLLARS A YEAR FROM SCRUTINY, THEN ALL OTHER PROGRAMS THAT SIZE GET A PASS AS WELL. THIS TOO-SMALL-TO MATTER EXEMPTION WOULD LEAVE THE EPA, IRS, NASA, NOAA, PUBLIC TELEVISION - AND YOU GET THE IDEA.
GETTING FEDERAL DOLLARS NOW IS NO JUSTIFICATION FOR CONTINUING TO GET PUBLIC DOLLARS. BUDGET CUTS SHOULD BE MADE ACCORDING COST-BENEFIT CALCULATIONS, NOT ENTITLEMENT PRECEDENCE.
FOR GROWERS SEEING HISTORICALLY HIGH PRICES, THAT COULD PRESENT A PROBLEM. NEITHER MY $25 PER ACRE DIRECT PAYMENT OR A LOAN LEVEL OF $2 IS KEEPING ME IN BUSINESS.