Agriculture Reference
In-Depth Information
small, struggling farmers during the Great Depression, but
since then they have evolved to favor rich people and multina-
tional corporations. There is some truth to this, but farm poli-
cies have always been a political strategy used by politicians,
and those occurring after or before the Great Depression are no
exception. Politics predates the Great Depression by millennia.
President Franklin Delano Roosevelt (FDR) was elected to
the presidency in 1933 on promises that he would actively fight
the nation's prolonged recession. His administration believed
that markets had failed to coordinate agricultural activities
effectively, and that government could do better, so part of
his New Deal legislation was to establish a formal and some-
what Byzantine set of policies that would allow government
to control prices, make loans to farmers on favorable terms,
control production, store commodities, and provide insurance.
As these policies were being implemented, many politicians
tried to decipher FDR's formula for how much government
support each state would receive. What they found was that
most money was devoted to swing states, not because they
needed more relief but because FDR wanted to ensure their
support in the next election. This doesn't mean that there were
no altruistic intentions behind the New Deal legislation, only
that altruism was partnered with politics, and politics has a
way of taking over.
If you ask agricultural economists today why we have farm
subsidies, few will say they are intended to help struggling
farmers. Most, especially those who study farm policy, will
remark they exist for political reasons. There is little doubt that
we restrict sugar imports because it makes the Fanjul broth-
ers rich, and the brothers give handsomely to both political
parties (they have so much influence that Bill Clinton inter-
rupted breaking up with Monica Lewinsky to take their phone
call!). Julian Alston and Daniel Sumner are among the most
respected agricultural economists today, and they say plainly
that the real purpose of agricultural policies is to redistrib-
ute wealth from the taxpayers at large to a targeted group of
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