With the House and Senate Agriculture Committees set to mark-up a new farm bill this week, The Heritage Foundation’s Daren Bakst pulled together a few things for Congress to keep in mind in a recent blog post.
1) Central planning is just as bad with agriculture as it is with any other industry. Some in Washington may think, for example, that they can take on the impossible tasks of determining the perfect price for soybeans or the proper supply of sugar. Only the free market, and not centrally planned economic systems, can allocate resources in the most productive manner. Agriculture is an extremely complicated sector, and those who advocate for limited government and free-market principles in all other aspects of the economy shouldn’t create a special exception for agriculture. …
6) Subsidies hurt consumers. The cost of subsidies is not just limited to the burden on taxpayers. Consumers are also harmed because of higher prices that result from artificial attempts to drive up prices, such as through quotas and tariffs. The sugar program, for example, which is essentially one big anti-consumer market distortion, has led to American sugar prices being two to four times greater than world sugar prices.
Read the full blog post here.