Tax Cuts for the Rich – Bad; Subsidies – Good
Barack Obama and the Democrats have promised to make this election a turning point in the fight to make the rich “pay their fair share” of taxes. They are using biblical innuendo to suggest that it is immoral for the top 1% of earners (who happen to make 17% of nation AGI) to only pay 36.7% of the federal income taxes. This is their hill to die on.
Accordingly, one would expect Democrats to be the first ones to issue garrulous protestations against farm handouts for the rich. At present, more than 3/4 of farmers who earn upwards of $250,000 a year receive subsidies from at least one farm program. Farm subsidies and crop insurance programs help promote income inequality in farming by offering larger subsidies to those who already have larger farms. These farmers can enjoy multimillion dollar insurance policies that are subsidized in order to guarantee their multimillion dollar investments that would otherwise not be supported by the free market. Also, federal guarantees of bankers’ loans to rich farmers have further increased their borrowing capacity, thereby driving up the cost of land acquisition. This, in turn, has shut out small farmers from the business, making it nearly impossible for them to compete.
It’s no surprise that the number of individual farms has dramatically decreased since the inception of government-run agriculture. According to the Heritage Foundation, the number of farms has declined from 6.8 million to 2.2 million since the Great Depression, despite the fact that the total acreage of farmland has only declined by 13%. The advent of mechanized farm tools has undoubtedly fueled the increase in large farms, but the government has put the nail in the coffin of the small family farm.
If there’s one sphere of public policy in which there is inequality and redistribution to the rich, it is in agriculture. One would expect the progressives to trip over themselves to eliminate these giveaways for the rich, right?
Yesterday, Senator Rand Paul offered an amendment to deny access to farm programs for those with an AGI of over $250,000 annually. Only 1 Democrat (Herb Kohl) in the entire Senate voted for this amendment. Sadly, only 14 Republicans voted for it either.
It seems that Democrats will only oppose tax cuts but will continue to support subsidies. After all, it’s not about the poor; it’s about creating government dependency for all constituents. Maybe we should just call the Bush tax cuts subsidies and then the Democrats will jump aboard.
One of Reagan’s most incisive declarations was when he summed up government’s view of the economy like this: “If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”
At some point, we must stand up and tell our brethren in the farming community that we will not tax your family farm into oblivion upon your death; we will not regulate the size of your henhouse cages; however, we will not subsidize you either.
Cross-posted from The Madison Project