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A peck of trouble

The House Democrats' farm bill did nothing to uproot harmful subsidies, so it's up to the Senate to dig in.

July 31, 2007

If the farm bill that oozed through the House of Representatives last week is Speaker Nancy Pelosi's idea of accomplishing Democrats' goals, we prefer the good old days of do-nothing Congresses. Pelosi, whose San Francisco district is a center of opposition to traditional farm subsidies, hammered together a broad coalition of Democrats aiming to preserve the status quo for another five years.

Democratic leaders did it by playing Santa Claus. To representatives from California and other states that don't grow the types of crops that traditionally get federal handouts, they doled out $1.6 billion for specialty crops such as vegetables and nuts. To the Congressional Black Caucus, they handed at least $100 million to help settle discrimination lawsuits by minority farmers. To urban liberals, they gave a needed expansion of the food stamp program. And to Democrats in farm states, they presented a bill that keeps in place all of the trade-distorting subsidies that made the 2002 farm bill a shameful violation of international agreements.

To pay for all this, the bill would impose a new tax on U.S. subsidiaries of foreign companies. That drew the ire of Republicans who might otherwise have supported it and assured that the bill would pass on a mostly party-line vote. It also produced a veto threat from President Bush.

The added benefits for food stamp recipients and improved nutrition programs are worthwhile, but an obscure new tax that might violate international treaties is the wrong way to pay for them. Instead, the House should have phased out the price supports and loan guarantees that artificially inflate food prices in this country and make it nearly impossible for growers in poor countries to compete. So badly managed are the farm bill's subsidy programs that a Government Accountability Office investigation turned up $1.1 billion paid out over seven years to dead people.

There are three ways to undo the damage Pelosi and company have wrought. First, the Senate could craft a more sensible farm bill when it takes up the matter in September. Second, Bush could make good on his veto threat. And third, Canada and Brazil could win their cases at the World Trade Organization challenging some U.S. farm supports. Because options two and three would only confuse the issue, the best hope for real reform lies with the Senate.

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