Where is the Windfall Profits Tax on Farmers?
This week, we have been given a chance to see a real contrast. Two consumer staples, gasoline and food, have both seen their prices go up substantially over the last several months. Both price spikes have been due to a combination of market forces (particularly increasing wealth in Asia) and US government policy that has the effect of restricting supply.
However, the political response from Congress has been completely different. In the very same week that Democrats in Congress have introduced bills to punish oil companies for high prices with windfall profits taxes, they have passed a farm bill that rewards farmers who are already getting record high prices with increased price supports and direct subsidies. This despite the fact that on a percentage basis, the increase in crop prices has been far larger than the recent increase in gas prices. The contrast in approaches to two industries in very similar situations couldn't be more stark.
The only reason I can come up with is votes: There are a lot more farmers and people who feel themselves dependent on the agricultural industry than there are oil workers. The oil industry is incredibly efficient on a revenue per employee basis, and I guess that comes back to haunt them. There is no oil industry equivalent of the Iowa Caucuses to cause politicians to fall to the ground groveling and shoveling out taxpayer money to buy votes.
Bob Smith:
There is also the fiction of the "family farmer" and that farming isn't a real business.
May 9, 2008, 10:40 amRandy in Arizona:
It might be a bit of a shock to the legislators voting for this if some of the oil company political donations get directed towards some incumbants' opponents in future elections.
Serve them right!
May 9, 2008, 11:19 amDan:
Before smearing Democrats on this issue, let's remember that both parties are equally guilty over the last decades of smothering wealthy farmers with unneeded subsidies. I didn't notice any major change in farm policy in the 12 years during which the GOP controlled Congress, or in the seven years Bush has been president. And many Republicans, particularly from the farm belt, will be supporting this bill that you criticize.
Having said that, I think farm policy is a sham, and a pox on both parties for letting it happen. In this instance, I firmly support President Bush, who wants to cut back on this colossal waste of money. I wish he'd show more leadership on the issue.
May 9, 2008, 12:38 pmbill-tb:
Democrats, trying to buy farmers votes. They do it everytime when they run Congress. It never works, the farmers realize that Marxism is not for them.
Democrats, raise taxes, fund socialism and gun control. What's so hard to understand, they are simple creatures.
May 10, 2008, 5:02 am