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13 July 2013

Food Stamps and the Farm Bill

Well, the GOP has passed their version of a farm bill, (nice easy-to-understand writeup is here) and there's no mention of food stamps, which, as our handy-dandy article notes, is a subject traditionally logrolled into annual farm bills to get urban Democrats to be more supportive of rural welfare -- trading rural welfare for urban welfare, as the case may be. (The overall impact of omnibus bills full of pork and indiscriminate spending on public finances and the health of constitutional government is a subject for a different day.)

And, my-oh-my, how the Democrats howled. Evil heartless Republicans were "taking food out of the mouths of your own poor constituents," as the virtuous and generous Nancy Pelosi phrased it. Of course, the food stamps will keep on coming; the only issue is that now they are going to be in a separate bill.

But it seems peculiar to me why the Democrats are so supportive of food stamps, when they are so opposed to vouchers for other things, such as education, or health care provision.

One of the things that the economist Murray Rothbard got right was that there is a huge bias towards the status quo in politics. As he put it, if there was traditionally a government monopoly on shoes, the Planners would be up in arms about Libertarian efforts to free up the shoe market, asking, "But who would produce the shoes? How many stores would there be in every town?" Yet the Left doesn't, for sensible reasons, argue that we in the US need special centralized planning for food -- there is longstanding bipartisan consensus that a voucher system is clearly the way to go. Individuals have the best information on what their food needs are, and accordingly shop at regular stores using their government debit cards. Why then, do they not see that voucher systems or tax credits could be used for other things that the government wants to support, but perhaps would not be the most able decision-maker on?

Some of this, of course, has to do with interest-group politics, and the role organized teachers' unions have in the Democratic Party. We can only imagine how the workers of a hypothetical state-run Nutritional Distribution Network would react to the idea of a libertarian-minded Senator introducing a "food voucher" bill in Congress for the first time. It wouldn't matter that the food at Safeway is produced more efficiently, cheaply, and of a higher quality than Government Cheese (or Government Raisins); what matters is that the NDN's way of doing things as a monopoly is threatened.

A similar dynamic is at work in health care. The overall drive of the health care debate is that prices of health care are steadily increasing faster than the average Joe's paycheck. Part of this, indeed a great deal of this, concerns the fact that the quality of the service is increasing faster than in other sectors of the economy -- the "product" is qualitatively better than it was 30 years ago. An MRI scanner detects more problems and creates a better quality of life than using an X-ray machine, not least for the technicians administering the tests. But an MRI machine is damn expensive, and the costs of installing one have to be borne by someone. Yet the Democrats' answer to this problem is to set up a Health Care Distribution Network, thus both eliminating the incentives to bring these costs down as well as entrenching various interests that my not have "the public welfare" as a primary consideration. Why not let the market system, supplemented by a voucher program, work the same way it does in the food stamp program?

So keep food stamps, and encourage Republican lawmakers to pass some kind of bill that keeps that form of the system in place. Then move on to the next logical step. The poor will appreciate it.

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