News of the Morning

Massa's reluctance to support the budget is the focus of this WETM story.

The Hill discusses 2010 strategy for both parties, noting that Massa is part of the Democrat's Frontline program, which is designed to defend tight races.

Comments

Massa's opposition to eliminating subsidies to farms grossing over $500K is persuasive in that a lot of what we would agree are small farms gross much more than that. I don't see how a modern farm, certainly those that are in retail, can take in less than that and survive. Can they survive without subsidies?

Whether the largest wine and spirits conglomerate in the area can survive without subsidies is another question altogether. Besides growing its own grapes, it employs an awful lot of people and provides a market for grapes and juice produced by small independent vineyards.

I can understand that basing the subsidy cut-off on gross income, rather than net, is reasonable, given the ability of large companies to show little or no profit while remaining very wealthy. Massa's vocal opposition highlights the fact that the farm subsidy question is a lot more complicated
than it might appear on the surface, even before you add the potential effect on his '10 election prospects.

Can they survive without subsidies?

Good question - I think the answer in the short-term is "No", and in the longer term is "Maybe".

The issue is transferring from a subsidy-driven market to a more "free" market. Two questions: (1) Is this a good idea? (2)If so, is the $500K limit the way to do it?

(1) My view is that a free market makes sense for goods that are non-strategic. Subsidies fund an oversupply of certain foods that we think are critical to our economy and/or security. We need to have an intelligent conversation about what's worth subsidizing. A $500K cap is pretty arbitrary - maybe it should be higher for some items (e.g., Milk or grain). Though I appreciate New York State wines, I don't see the strategic or economic argument for subsidizing them. But there might be an argument out there.

(2) Even if we are going to stop some subsidies, the $500K limit is pretty harsh, because farming is capital-intensive and many "small farms" or "family farms" can gross that amount and still net a tiny amount. A lot of those farmers have planned on having subsidies for the coming year - they will go out of business without them.

If we want to get rid of some subsidies, it needs to be gradual so that we can wean farmers. Even someone as conservative as Ron Paul realizes this when he talks about Medicare. He opposes it, but he recognizes that current recipients can't just be cut off because they've made life plans based on getting Medicare. The same is true of any government subsidy or program. We need to deal with the dependencies we created in a humane manner.

NY state is unlikely to ever regain its stature as a wine producer, and of course wine isn't the first thing on people's minds in this economy. But the fact is that the growth of small wineries in the Finger Lakes region, along with the influx of Amish and Mennonite farmers and as well as farm preservation, have had a good effect on tourism and employment. Massa has got to be mindful of that.

I would prefer that subsidies go to mass transit and sustainable alternatives to oil and coal, rather than to the vertically integrated corporations that control our food supply from seeds and fertilizer to processing and retail sales. These companies determine how we produce and consume food and affect our environment, national security and foreign policy in the same way that the energy companies do. Maybe it's just a romantic idea, but I think that small farms, besides providing local alternative food supplies, are worth protecting, as are our forests, mountains, waterfalls, coastlines and deserts.

I agree that we really need to target subsidies where they are needed. Determining just what the needs are and how to untangle the web of farm subsidies that has grown over the past seventy years isn't as simple as the $500K proposal suggests. But I can't remember any administration bringing the issue up for discussion before.