Some news out of Congress today, the new farm bill has made it out of Committee in the House. Unfortunately for those who believe in markets and development in poorer countries the bill includes new funding for price supports. Given the new mantra that all spending must be “paid for” how does Congress come up with the funds? By cutting food stamp payments.
Some background. According to BLS the agriculture sector employes 371,180 people who earn an average wage of $25,680. That’s an individual, not household, wage. In contract, 46.4 Americans were receiving some food stamp (now officially known as SNAP) payments. Their average household has an income of about $8,800 per year.
So how does this happen? I have no insider knowledge on this issue, but here’s my guess: Republicans wanted to cut spending and they focused on SNAP as a target. Some of this is probably because it’s an easier target and some is because of the strain of thought which believes that payments such as SNAP encourage dependence and stifle initiative. This immediately lost the support of Democrats. Needing votes the leadership had to go cap-in-hand to the farm lobby who demanded support for agribusiness as their price. So the leadership got its goal of some cuts but had to compromise on extra spending.
Unfortunately the division of cuts and spending looks just horrible. As Walter Russell Mead noted:
A party with principles might cut food stamps and farm supports. A party with no principles but good political instincts might spend more on food stamps and farm subsidies. But to cut food stamps while subsidizing big agriculture manages to make Republicans look hard-hearted and spineless at the same time.
This sort of manoeuvre may help in the short-term as is gets a bill done. But in this case no bill might be better.