SOME PROPOSED spending cuts in the administration's budget plan would inflict unjustifiable damage on important programs. But President Bush's proposal to cut farm subsidies represents good policy and plausible political calculation. The nation's egregious farm programs waste taxpayers' money -- as much as $20 billion of it in some years. By pushing up land prices, they hurt farmers who rent land. They overstimulate production and drive down agricultural prices, harming developing countries that hope to export their way out of poverty. And they are badly administered. If the purpose of farm subsidies is to make family farms viable, it's hard to see why payments of more than $400,000 apiece should have gone to 54 deceased farmers between 1995 and 2003, or why residents of Chicago should have collected $24 million in farm support over that period.
Mr. Bush's farm ideas begin with what ought to be a no-brainer: a cap on subsidies that can be paid to any one farmer. In theory, there is already a cap of $360,000 per year, but it is riddled with loopholes and many farmers collect well over $1 million from the federal government. The president wants to lower the cap to a still generous $250,000 and close the loopholes. A similar proposal passed the Senate in 2002 with 66 votes but was stripped from the broader legislative package; a new bill closely reflecting the president's position was introduced in the Senate on Tuesday. Given this support and given the obvious outrage of devoting large sums of taxpayers' money to propping up big agribusinesses, this proposal ought to make it through Congress, provided that the administration puts some muscle behind it.
Mr. Bush also proposes an across-the-board cut of 5 percent in farm subsidies, together with a requirement that farmers who receive them purchase crop insurance. The first is an amply justified money-saving device; the second would reduce the pressure for a federal bailout of farmers every time there is a flood or other disaster. It seems extraordinary that there should even be a debate about this insurance proposal. Factory owners buy their own insurance. Car owners buy their own insurance. So should farmers.
In the debates leading up to the farm law in his first term, Mr. Bush demonstrated a lack of backbone. His administration published a decent policy statement that explained why farm subsidies are unproductive, then wagged its tail obediently when farm-state members of Congress loaded up a bill with billions of dollars of farm pork. If Mr. Bush wants his professed commitment to spending restraint to be taken seriously, delivering on his agricultural proposals would be a good place to start.
