THIS SEASON'S presidential hopefuls have enjoyed attacking Congress for its meanness. In one area, however, they could usefully assail it for generosity. Last month a bipartisan majority voted through $8.7 billion worth of emergency farm aid, and now there are signs that federal subsidies for crop insurance may be doubled to $3 billion a year. Congress needs to get a grip on its farm spending. And candidates seeking budget savings to pay for health or other worthwhile programs should take a look at agriculture.
Federal support for farmers began in the 1930s, when the average income of farm families was one-third of the national average, and so the need for help was real. These days, however, that need is less obvious: The average farm income is the same as the national one. Admittedly, the Department of Agriculture worries about 150,000 "limited resource" farmers who make on average less than $10,000 a year. But federal support barely touches these deserving cases, because subsidies are allocated to farmers based on the amount of land they farm.
If the subsidized farmers are not poor, what is the "crisis" that so upsets Congress? The usual answer is that small farmers are going out of business in huge numbers. But in the five years to 1998, the number of farms declined by a mere 10,000, or half of one percent of the total. Some of the failed farms employed more than one person, others were run by a single part-timer: All in all, the closure of 10,000 farms probably represents about 10,000 job losses. Over the same five-year period, the clothing and textile industry has shed 400,000 jobs.
The onus is therefore on supporters of agricultural subsidies to explain why farmers deserve assistance. They can fairly argue that there is a public interest -- one shared by both consumers and farmers -- in smoothing swings in food prices. This interest justifies careful countercyclical aid; it does not justify massive ad hoc bailouts. Unfortunately, the farm reform act passed in 1996, in the course of phasing down subsidies, destroyed the old countercyclical mechanisms. Congress must now summon the courage to admit that it went too far in the right direction and recreate a less expensive version of the old policy.
It must also stop pretending that the bankruptcy of small farms is a crisis demanding federal remedy. Technological change is bound to force consolidation in agriculture. The right focus for public policy is to help money-losing farmers with relocation and training grants, not to fight natural attrition. Otherwise, Congress cedes the initiative to the presidential campaign. The candidate who takes on the farm lobby will deserve the gratitude of voters. He will also save money in the long run, which will make his other spending priorities more credible.