Friday, March 11, 2011

Claim of rural bias in federal spending disputed; Vilsack says ethanol subsidies need a phase-out

Federal spending on rural issues became the target of a recent blog post from Ezra Klein of The Washington Post, but his argument that the government subsidizes rural life to the detriment of cities may not hold up. "Klein’s initial point was that cities are unique in the efficient way they create new wealth," Bill Bishop of the Daily Yonder reports. "He then said that we should capitalize on this unique attribute of urban life, but that we won’t because the structure of the Congress inevitably leads to programs and spending that subsidize rural life." Bishop writes that argument doesn't hold up because federal spending per capita on urban counties is usually higher than it is in rural counties. (Yonder chart of per capita rural and urban spending)

Klein mentioned federal farm subsidies, but Bishop notes, "crop subsidies are a drip in the bucket of federal spending." Klein said disproportionate rural representation in Congress leads to a rural bias in spending, but Bishop says no such bias is reflected in spending on community development. "Spending on community resources in rural areas (for housing, community assistance, Native American programs, environmental protection, regional development and transportation) is far lower on a per capita basis in rural counties," he writes.

"The one area of federal spending where rural areas exceed urban ones is in the broad category of income security," Bishop writes. "This includes medical benefits, Social Security, disability, food and nutrition programs and education." This disparity can be attributed to the fact that rural people tend to be on average older and poorer than their urban counterparts, he argues.

Agriculture Secretary Tom Vilsack also took issue with Klein's story, but did say that ethanol subsidies to corn farmers should be phased out. Bishop argues the conversation between the two men was fruitless. Instead of discussing easily available facts, conversations like that one mean "nothing changes and nothing gets better, but everybody feels supremely righteous," he writes. An unnamed writer for The Economist says Vilsack offered "a pandering defence of agricultural subsidies so thoroughly bereft of substance I began to fear that Mr. Vilsack would be sucked into the vacuum of his mouth and disappear." (Read more)

1 comment:

Anonymous said...

Well, farm subsidies alone cost the taxpayer $46 billion. The taxpayer also pays $23 billion in your crop insurance. And I could go on. I don't necessarily oppose supporting farmers. But farmers are routinely protected from the capitalist system, decade after decade. Then they turned around and sent Senators and Congressional Representatives to Washington who refused to support industrial and service-sector employees who were thrown out of work in the Great Recession. These people don't ask for the protections farmers get month after month, year after year, generation after generation. They just ask for some help in an economic downturn. And your representatives kicked them in the face. So I think there are a lot of hard feelings for rural inhabitants. You'd look like Detroit, too, if you lived in the capitalist system.