NCPA - National Center for Policy Analysis

Government Still Handing Out Money To Farmers

October 13, 1998

When Congress handed President Clinton a bill containing $4.3 billion in emergency farm spending, he vetoed it in a hold-out for more than $7 billion. That relief package followed an August decision to give farmers $5.5 billion in subsidies months ahead of schedule.

Critics say this scenario illustrates the failure of the federal government to reform its farm policy.

There are other examples:

  • The 1996 "reform" -- the Freedom to Farm Act -- cost taxpayers more than if the bill hadn't been passed, since prior to the act, subsidies fell as agricultural prices rose, and in much of 1996 and 1997 prices were high.
  • The act failed to abolish outfits such as the Conservation Reserve Program -- which increases farm prices by keeping land out of production -- as well as the Federal Crop Insurance Corp. and the Market Access Program.
  • Moreover, several states have moved to block farm imports from Canada -- including livestock and wheat -- by claiming they don't meet standards and are being sold below cost.

As for the President's demand that Congress ante up $7 billion in emergency spending, it has signaled its willingness to boost emergency farm aid to $5 billion.

Source: Aaron Steelman, "Farmers Get a Bailout -- Again," Investor's Business Daily, October 13, 1998.


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