Farm Subsidies: The Dirty Truth
By Bryan Caplan
Here’s the best survey I’ve ever seen on farm policy. Big findings:
- Farm subsidies are extremely popular. Respondents had to choose between the following positions:
A. It is not consistent with the American way to have a whole sector of the economy dependent on government handouts at taxpayers’ expense. We should trust the market, not the government, to find the right balance between supply and demand.
B. There is nothing more important than food. The government needs to subsidize farming to make sure there will always be a good supply of food and that the price does not go up and down according to the whims of the market.
37% preferred the free-market position; 58% preferred the interventionist position.
- The SIVH fails yet again; public opinion in farm and non-farm states is virtually identical.
- Most Americans couldn’t care less about the harm their subsidies inflicts on the Third World. Respondents were given these alternatives:
A. Rather than giving poor countries foreign aid, it is better to let them export what they can produce. For many poor countries agricultural products are one of the few things they can export. We should not undercut them by flooding the world market with cheap subsidized farm products.
B. Farmers in poor countries work for much lower returns than American farmers. Without government subsidies, American farmers won’t be able to compete and a lot of people working on farms will end up unemployed.
38% preferred A; 53% preferred B.
Bottom line: In the sector closest to perfect competition, where economists truly have to think hard even to imagine a case against laissez-faire, Americans favor heavy intervention nevertheless.