Wednesday, May 28, 2008

$300 Billion Farm Bill Subsidizes Rich Farmers and High Prices

The Congress passed a scandalous farm bill designed to subsidize rich farmers and to actually pay farmers to not produce. Neither policies make sense when times are good, but are disastrous in light of our current economic situation.

The government is printing money like there is no tomorrow in order to cover its expenses. It is trillions in debt and is unable to cover its cost through revenues thanks to spending being out of control. In an environment such as this, the government has no business creating such a bill. President Bush agrees and has vetoed the legislation saying "At a time when net farm income is projected to increase by more than $28 billion in 1 year, the American taxpayer should not be forced to subsidize that group of farmers who have adjusted gross incomes of up to $1.5 million," the president said in his veto."

The bill provides $40 billion for some of America's richest farmers (those who have incomes of up to $1.5 million) and an additional $30 billion to pay farmers to keep their land idle. With grocery prices rising rapidly due to the rise of alternative fuels and ethanol and the need of more goods that will continue to assist such alternatives, do policies such as these make sense?

So what about the rest of the subsidy (the other $200 billion)? The vast majority of it goes to food stamps and other welfare programs. It is typical. Two separate issues that could not typically garner enough support on their own, passes because of political pandering in an election year.

Bush's veto is likely to be overridden by the Congress. We should consider overriding them by sending them home this November.

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Kevin Price is Host of the Houston Business Show (M-F at 11 AM on CNN 650) and Publisher of the Houston Business Review. Hear the show live and online at HoustonBusinessShow.com. Visit the archive of past shows here.

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