Monday, September 12, 2011

Slashing Crop Insurance?

Here's  a quote from Farm Policy, which I could duplicate from other pieces of propaganda information put out by the friends of crop insurance.

The article noted that, “Federal lawmakers have slashed more than $12 billion from crop insurance programs since 2008, [Moran] said, noting that subsidized crop insurance is important in a state that this year was ravaged by everything from flooding to drought.
  In the interest of fairness I should point out that a "slash" is not always a "slash".  Suppose the direct payment program is cut by $1 billion, or conservation programs are cut by the same amount--those could be called "slashes".  But those slashes are not the same as the slashes of crop insurance.

Why? Because those programs are fixed amounts, and a cut to them is by a fixed amount.  But crop insurance is an entitlement, so the government's budgetary exposure is not constant.  The exposure goes up and down (mostly up recently) according to program participation and crop prices.  So those slashes are calculated, based on the current conditions and projections, but the real spending cuts can only be determined after the fact.

The second reason is more indirect: program proponents make sure everyone is aware of "slashes" to the entitlement, but the increases in the entitlement creep in on little cats paws.  I'm not really picking on crop insurance; the identical logic and political posturing occurs among proponents of food stamps.

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