Come midnight, on December 31, absent congressional action, we’ll get a lot of policy changes.
The Bush-Obama tax rates might end, hiking taxes on everyone who pays income taxes, and some who don’t.
The payroll tax holiday will end, adding more tax hikes.
“Sequestration” will kick in, slashing military spending.
This is the heart of the so-called “Fiscal Cliff.”
But did you know that at the end of the month, the current agriculture legislation expires, too? All sorts of farm subsidies would expire. Some would revert to older subsidies.
The left-right combination of Vince Smith (AEI) and Scott Faber (Environmental Working Group) warn against a farm-bill deal in the midst of all the fiscal cliff chaos, arguing that now is the time to serious unwind our bloated farm boondoggle:
Farm income has soared, tripling over the last decade. Even this year, despite a historic drought that withered much of the corn and soybean crops, farm income is projected to stay high, thanks in part to the generously subsidized federal crop insurance program and the corn ethanol mandate.
It makes no sense that federal subsidy dollars go overwhelmingly to the largest, most successful landowners and farm operators — precisely those who need it least. Since 1995, the top 10 percent of farm subsidy recipients have cashed 74 percent of all subsidy checks. In 2011, for instance, 26 individual holders of crop insurance policies collected more than $1 million each in subsidies to help pay their insurance premiums.
Neither the House nor Senate bills would do enough to rein in these lavish handouts. They do take the positive step of ending one type of farm subsidy — the discredited and wasteful direct payment program — but both proposals turn right around and funnel most of the savings into other new or expanded subsidies. In fact, if prices for major crops such as corn, soybeans and wheat drop even modestly from their current record levels, those new House and Senate subsidies would be very costly for taxpayers and do nothing for the budget deficit.