published Wednesday, June 1st, 2011

Hidden costs raise food prices

When families go to the grocery store, they can look at the shelves and know what they are paying for the food they buy. But how many of us realize those food prices are higher because of taxpayer-financed subsidies imposed by Congress?

Do you realize that you are paying about $5 billion in taxes a year to support higher prices for 10 major crops — including wheat, corn and rice?

In addition to the $5 billion that the federal government spends in direct cash payments to farmers, there are other taxpayer-provided costs that may run from $5 billion to $20 billion a year in taxes. They include such programs as farm loans, insurance, conservation and disaster aid.

Those things turn up in our food prices — and our tax bills.

Would you expect only conservatives to object? Well, David DeGennaro, of a liberal organization called the Environmental Working Group, opposes farm subsidies, too. “It’s just a cash handout for landowners and farmers, who get it whether they need it or not,” he told McClatchy Newspapers.

Brian Riedl, an economist with The Heritage Foundation, added, “Most people who do not directly benefit from farm subsidies seem to recognize that these programs have been an absolute failure and make virtually no economic sense.”

Well, are the subsidies simply intended to help hard-pressed family farmers? Not really. Most of the money goes to corporations, not family farms.

We aren’t against either farmers or corporations, but why should we be against the taxpayers who have to subsidize them?

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EaTn said...

Food prices affect both the right and left, so this is not a partisan issue. Even the golden arches is facing tough pricing issues with their raw food costs expected to climb near 4% the next year. The most ridiculous govt subsidy is the ethanol scam that is competing for our food supply and adding to the price pressures. It's time our state reps in DC start supporting the citizens that elected them instead of reacting to lobbyists.

June 1, 2011 at 6:07 a.m.
nucanuck said...

The biggest factor in food price increases has been the Fed's expansionary monetary policy. Put the blame where it belongs.

June 1, 2011 at 11:49 a.m.
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