Subsidies are a form of financial assistance designed to reduce the risks and costs of endeavors that would otherwise fail or suffer. They remain one of economists’ preferred methods for correcting the well-understood inefficiencies of the market place. Problems do arise, however, when subsidies are driven by a powerful few with personal interests in mind. The Kansas farm is such a place, where we find this discriminator subsidization; and here we can see how this has led to the marginalization of the public and the environment.
According to information from the United States Department of Agriculture, 39 percent of Kansas farmers did not receive any of the $622 million in subsidies distributed in 2006.
Of those receiving subsidies, the top 10 percent collected 67 percent, yielding a yearly average of $31,745. That left a mere $931 yearly average for the bottom 80 percent of farmers.
The subsidy program has done more than simply shift money around. It creates an abundance of cheap calories. Farmers are encouraged to produce far more than the country can use, depressing prices, increasing subsidy payments, and leaving a surplus of commodities.
Farmers have eliminated the surplus food in wasteful ways. Cows no longer eat grass, but rather are fed corn, the top crop for federal assistance. In fact, according to the National Corn Growers Association, 80 percent of corn grown in the U.S. is consumed by domestic and overseas livestock, poultry, and fish. Only about 12 percent ends up in foods that are either consumed directly or indirectly. “Indirectly” includes such things as high fructose corn syrup.
Actually, the farm subsidies do little to encourage the production of food that we actually eat. Farmers receiving subsidies are restricted from growing “specialty crops” — farm-bill language for fruits and vegetables.
The overproduction of cheap food — done mostly on mono-crop farm factories kept afloat by fossil-fuel based fertilizers and pesticides — exacts a terrible cost on the environment and our health.
Writing for Time magazine, Michael Grunwald effectively summarized the subsidization as a “welfare program for the megafarms that use the most fuel, water and pesticides; emit the most greenhouse gases; grow the most fattening crops; hire the most illegals; and depopulate rural America.”
In the subsidy program, the costs and risks of the few are subsidized by the many. Only the few are allowed to collect the profit in the good times, but all bear the costs in the bad.
It should not come as a surprise that such programs exist, when our culture of individualism encourages us to seek out what is best for ourselves (based on the assumption that this leads to what is best for the many). Instead of progress, we find ourselves in a system that affords all the comforts of socialism for the rich, while reserving rough and unforgiving capitalism for the rest of us.