You might think that U.S. Treasury officials would have cringed last month when the president and Congress signed off on a Farm Bill with a total cost of US$867 billion. That’s 155 times more than President Trump’s US$5.6-billion request for the border wall, which shut down parts of the U.S. government.
In fact, they probably breathed a sigh of relief. And it wasn’t really a “Farm” Bill.
Why a sigh of relief at such a huge sum? The Farm Bill goes back to the so-called “Golden era of agriculture” from 1910-14, when a system of “parity prices” was established to relate farm prices to the consumer price index. The Farm Bill later became permanent legislation, and if not revised and renewed every five years, price supports to U.S. farmers revert to parity levels, which would be US$13.20 per bushel for corn and US$18.10 for wheat. So there’s quite an incentive to approve the legislation without too much argument.
And why is it not really a “Farm” Bill? That’s evident from the accompanying chart (image at top). Over the years, the Farm Bill has evolved into blanket legislation for the entire U.S. food system. Of the projected $867 billion for the next 10 years, US$664 billion or 76 per cent is for consumer nutrition programs, of which the largest portion is for what used to be called Food Stamps. It’s now called Supplemental Nutrition Assistance Program (SNAP), under which low-income Americans can receive a card which allows them to buy nutritious food, including breads and cereals; fruits and vegetables; meats, fish and poultry; and dairy products.
SNAP benefits cost US$70.9 billion in fiscal year 2016 and supplied 44.2 million Americans (14 per cent of the population) with a monthly average of $125.51 per person in food assistance.
There are several other nutrition programs funded by the U.S. Department of Agriculture, including school lunches and breakfasts, programs for children on summer holiday, fresh fruit and vegetable programs and a Special Milk Program which provides milk to children in schools which do not participate in other meal-service programs.
This provides a different perspective on the supply management debate in Canada. Critics sometimes claim that Canada’s (allegedly) higher dairy prices are unfair to low-income families. But if we were to adopt the U.S. dairy system, should we also adopt its system of providing free milk to some consumers?
If Canada had the same “farm” policy as in the U.S., with one-ninth of the population the Agriculture and Agri-Food Canada budget would be US$9.6 billion per year, compared to C$2.6 billion projected for 2018-19.
We often hear discussion of the difference between U.S. and Canadian agricultural policy, but the really significant differences are in food policy for consumers.
John Morriss is former editor of the Manitoba Co-operator.