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Tyranny of Special Interests: 110th Congress Edition May 15, 2008

Posted by federalist in Economic Policy, Government, Special Interests.

How can a minority extract rents from a majority in a democracy? Congress has illustrated this for years with abusive “earmarks.” Past posts (here, and here) have addressed the structural defects of our democracy. But this week Congress gave us an exceptional lesson in political logrolling: A small coterie of wealthy farmers secured record subsidies by … well, the Wall Street Journal summarizes it nicely:

If you wonder why urban Democrats would vote for this rural giveaway, the answer is they have been bought off with roughly $10 billion in extra funding for food stamps and nutrition welfare programs. Someone should tell them that their constituents might not need this cash if the farm bill didn’t help keep food prices high.



1. federalist - May 26, 2008

BTW, instead of subsidizing Big Agriculture why isn’t Congress calling for windfall profit taxes, as they did for Big Oil? (Hat tip: Gary Townsend.)

2. federalist - September 6, 2009

Sugar is an even more powerful special interest: They not only have an import tariff but also an import cap!

For most agricultural products, U.S. import quotas are not an issue because they do not exist. Pay a modest tariff, and you can import what you need. For farm goods like corn and soybeans, tariffs are low or nonexistent, and yet imports do not overwhelm domestic producers.

In the case of sugar, import quotas place an absolute limit on food and beverage makers’ access to supplies, and U.S. production alone is insufficient to meet demand.

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