Bryan Caplan  

Farm Subsidies: The Dirty Truth

PRINT
Do the Overweight Pull Their W... Wake Forest Liberty and Societ...

Here's the best survey I've ever seen on farm policy. Big findings:

  • Farm subsidies are extremely popular. Respondents had to choose between the following positions:
    A. It is not consistent with the American way to have a whole sector of the economy dependent on government handouts at taxpayers’ expense. We should trust the market, not the government, to find the right balance between supply and demand.

    B. There is nothing more important than food. The government needs to subsidize farming to make sure there will always be a good supply of food and that the price does not go up and down according to the whims of the market.

    37% preferred the free-market position; 58% preferred the interventionist position.

  • The SIVH fails yet again; public opinion in farm and non-farm states is virtually identical.

  • Most Americans couldn't care less about the harm their subsidies inflicts on the Third World. Respondents were given these alternatives:
    A. Rather than giving poor countries foreign aid, it is better to let them export what they can produce. For many poor countries agricultural products are one of the few things they can export. We should not undercut them by flooding the world market with cheap subsidized farm products.

    B. Farmers in poor countries work for much lower returns than American farmers. Without government subsidies, American farmers won’t be able to compete and a lot of people working on farms will end up unemployed.


    38% preferred A; 53% preferred B.

Bottom line: In the sector closest to perfect competition, where economists truly have to think hard even to imagine a case against laissez-faire, Americans favor heavy intervention nevertheless.


Comments and Sharing





TRACKBACKS (3 to date)
TrackBack URL: http://econlog.econlib.org/mt/mt-tb.cgi/692
The author at Trade Diversion in a related article titled Public opinion of farm subsidies writes:
    Bryan Caplan: "In the sector closest to perfect competition, where economists truly have to think hard even to imagine a case against laissez-faire, Americans favor heavy intervention nevertheless."... [Tracked on April 28, 2007 2:24 AM]
COMMENTS (9 to date)
Jason Briggeman writes:

If that's the best survey you've seen on the topic, you haven't seen any good ones. The interventionist pitches are emotionalized in an effort to sell themselves, and the market pitches aren't - in fact, they seem deliberately over-intellectual and confused. Give me a survey where each answer tries hard to sell itself, and I'll be more persuaded. As it stands, what this really demonstrates (once again) is that responses to surveys asking detailed, policy-specific questions are quite malleable.

Eric Crampton writes:

The only glimmer of hope in there is that people oppose subsidies for big agrifood companies, but that doesn't seem terribly robust: they still seem to support subsidies to those companies when framed as being in bad years or to protect against foreign companies.

Jason: I don't see any bias in the question wording. The statements look like fair portraits of the common positions on either side. The problem is that the wrong side is inherently more rhetorically appealing on this one.

PJens writes:

Over at Volokh.com they are talking about farm subsidies too.

I hope the next farm bill will have more safety net features and less direct cash outlays. Not holding my breath on it though.

Bruce G Charlton writes:

I think you may be setting up a straw man by investigating the public understanding of technical issues such as economic policy.

Luckily, modernizing society does not depend on such technical understanding, indeed the essence of modernization is the separation and autonomy of social systems - so that economic policy (for example) is over the long term becoming progressively separated from politics.

But the public doesn't decide political policy either. They vote a new government every few years. And wannabee governments offer a package or *program* of linked policies.

Lack of public understanding of detailed policies only becomes a seriosu problem when they get to vote on specific policies - like in California - where referenda can lead to contradictory policies eg. for lower taxes AND higher public spending.

Generally speaking the fact that elections are for programs not policies is a safeguard against this kind of voter irrationality.

R.J. Lehmann writes:

"Lack of public understanding of detailed policies only becomes a seriosu problem when they get to vote on specific policies - like in California - where referenda can lead to contradictory policies eg. for lower taxes AND higher public spending."

And that's different from the voting behavior of Congress....how, exactly?

Daniel Lurker writes:

Because farmers in other countries work at low wages, the only way that small American farmers can compete is to give them regular annual subsidies.

Am I missing something, or is the question asking "American farmers are much more productive than foreign farmers. Therefore our government should give them money to ensure their survival." in a way designed to appeal to rationally irrational voters?

Jason Briggeman writes:

Eric, the bias is in the overt reference to consequences in both interventionist pitches and in the lack of reference to consequences in the market pitches. Specifically:

Interventionist pitch #1 raises twin specters of food shortages and price swings; market pitch #1 makes a ridiculous (as if the food industry is entirely manipulated! as if no other industries are subsidized!) philosophical claim about "consistency".

Interventionist pitch #2 predicts that Americans will become unemployed; market pitch #2 doesn't even say that foreigners might become unemployed, let alone the idea that they might not be able to feed themselves.

The market pitches don't even try to argue that subsidies are unnecessary. Where is an attack on corporate farmers getting rich off subsidies? Where is the mention of government food stocks that get thrown away? Whoever wrote the question didn't even TRY to get people to choose the market pitch, and it STILL got over 30%. The results if anything are cause for optimism.

Biopolitical writes:

"Flooding the world market with cheap subsidized farm products" is probably better for poor people than official aid. Poor consumers enjoy lower food prices while official aid often just helps dictators.

B.S. writes:

Libertarians have succeeded in convincing people that social liberalism is ideal, which is the easy part. Convincing people that free markets work is more difficult, because there is always anecdotal evidence the other way. Small minds....

Comments for this entry have been closed
Return to top