Rice County Republicans

Farm subsidies are often a place where free-market Republicans clash with agribusiness-supporting Republicans on principle.  Here at the RCR, we like to watch our principles carefully, lest we become RINOs. Today’s question? Are farm subsidies consistent with our principles? Consider this point-counterpoint dialog from April 2007, “Should the United States Cut Its Farm Subsidies?” by Daniel T. Griswold (then director of the Cato Institute’s Center for Trade Policy Studies) and Bob Young (then chief economist for the American Farm Bureau).

Young’s arguments seem to be a parody of themselves.  First, he says, we have subsidies because we always have. Besides, they are declining precipitously. Besides, everyone else does it.

Meanwhile, Griswold argues that the low projected costs are just that, and a decline in prices would drive them off the scale (I guess he did not forsee, in 2007, the explosion in prices suspected to be due to the ethanol subsidies). He cites New Zealand, where the people did not suffer when the government dismantled much of its programs.

It was instructive and ironic to read (further down in the debate that “The government doesn’t micromanage the price and production of housing, cars, clothing, or energy–and thank goodness for that.“  Oooops. So much for not micromanaging production of cars.

The principle that Republicans rely on is that”Free markets are the best means we have to solve economic problems of supply and demand.” This is in opposition to planned economies from simple communes to full scale totalitarian regimes. On a smaller scale, government interference through subsidies, whether for oil drilling, wind farms or crop subsidies, are on principle, wrong. For a people who believe in principles, the answer seems black and white in this case.

Our dilemma is, how we can stand on principles and still pander to special interests? Of course, the answer is that we cannot. So then, how do we defeat candidates of either party who will pander? That may be the true tragedy of the commons we face as a party.

Footnotes and References:

• “[L]abour union lobbies and their political friends have decided that the ideal defence against competition from the poor countries is to raise their cost of production by forcing their standards up, claiming that competition with countries with lower standards is “unfair”. “Free but fair trade” becomes an exercise in insidious protectionism that few recognise as such.” (Jagdish Bhagwati, “Obama and Trade: An Alarm Sounds,” Financial Times. January 9, 2009)
• TRADE WARS, Gunnar Sjöstedt, Swedish Institute of International Affairs.
• Former Vice President Mondale (in early 1980s): (a famous quote supporting tarrifs):
  “We’ve been running up the white flag when we should be running up the American flag. What do we want our kids to do? Sweep up around Japanese computers and spend a life-time serving McDonald hamburgers?“.
  Former Vice President Walter Monday, echoing former Secretary of the Treasury John Connally, quoted in “War & Peace” by Thomas R. Graham,one-time deputy general counsel in the Office of the U.S. Trade Representative, early 1908′s.