The New York Times

August 14, 1986, Thursday, Late City Final Edition

SECTION: Section A; Page 23, Column 2; Editorial Desk

LENGTH: 700 words

HEADLINE: Buying Off the Farmer

BYLINE: By James Bovard; James Bovard writes frequently about agriculture.


BODY: Federal farm programs have degenerated into a morass that bleeds taxpayers without benefiting farmers. We will spend some $30 billion on farm programs this year - plus another $10 billion or so in higher food prices. Yet rural America keeps suffering.

Instead of dishing out subsidies that artificially prop up the industry -which President Reagan praised during his visit to Illinois this week - we could provide small loans to help people get out of the farming business permanently.

Federal price supports encourage farmers to boost production to the hilt, creating enormous surpluses. But at the same time, the Agriculture Department is paying farmers to idle 30 million n res in an effort to reduce harvests and thereby raise prices. The Government paid 156 dairy farmers more than a million dollars apiece this year to butcher their cows. Yet it still gives bonuses to the remaining dairy farmers.

In May, for the first time since 1959, the United States imported more food than it exported - possibly signaling the demise of the world's breadbasket. Federal handouts to farmers this year will likely exceed both net farm income and American agriculture exports to the rest of the world.

What's more, Federal policies have greatly decreased the efficiency of American farms. British farmers now produce twice as much wheat per acre as American farmers. Australian farmers can produce milk and cheese at half the price America's farmers do. Generous Federal handouts are proving to be financial Pyrrhic victories for farmers.

Several farm lobbies have responded by proposing a war on progress. A new hormone for dairy cows has been shown to boost milk production by up to 40 percent, which could result in sharply lower milk prices. But some national farm organizations favor banning the hormone, primarily because of a concern that it will reduce employment for dairy farmers.

Our farm policies are bushwhacking our allies and bailing out our enemies. The farmers in Thailand are ranting against our rice subsidies, the Latin Americans against our sugar subsidies, the Uruguayans against our beef-dumping. The list goes on. Recently the Reagan Administration agreed to give huge subsidies to the Soviet Union as a bribe for buying American wheat. Why don't

(c) 1986 The New York Times, August 14, 1986

we simply give the Russians direct military aid?

American farmers need more than sentimental bosh and buckets of tax dollars to survive and prosper. By treating farmers like a welfare class, we have crippled their incentive to maximize productivity and adjust to rapidly changing times.

If Congress has its way, the Agriculture Department will spend a hundred years ''easing'' farmers into the free market. But the longer we take to adjust, the further ahead the foreign competition will be. While members of Congress are busy delaying the inevitable adjustment, foreign farmers are busy increasing crop yields and taking over markets.

There is nothing that makes agriculture inherently different from other sectors of the economy. Pernicious policies that would disrupt any other productive endeavor will not somehow have beneficial effects on farmers.

If America is to exploit its natural advantages of a stable political environment, well-informed farmers, excellent crop land and superb infrastructure, then the Federal Government must stop disrupting markets and shielding farmers against their own mistakes. If we want prosperous farms by the late 1980's, we had better end agricultural welfare now.

A humanitarian solution is to give small loans to help people get out of the farm business rather than to try to maintain a permanent surplus of farmers hopelessly addicted to Federal aid. Current policies are like giving 25 cents to the bum in front of the liquor store - enough to keep him hanging on for a short time, but far too little to solve his problem.

The more farmers who leave the land, the easier it will be for remaining farmers to make an honest living. Federal programs create permanent surpluses that depress market prices, thus making it harder for all farmers to earn a living. The sooner we get rid of the agricultural safety net, the sooner American farmers will again dominate world markets.

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