Wednesday, March 01, 2006

Evil subsidies

Via Past Peak, an article by Tom Philpott on the economics of corn subsidies, and how corn subsidies directly cause obesity and poor health amongst the American poor:

"Why do low-income people tend to exhibit more diet-related health problems? Adam Drewnowski, professor of epidemiology at the University of Washington, posits a simple answer: people are gaining weight and getting sick because unhealthy food is cheaper than healthy food - thanks in large part to federal policies."


"Under the Farm Bill, the great bulk of USDA largesse flows to five crops: corn, soy, cotton, wheat, and rice. Of the $113.6 billion in commodity subsidy payments doled out by the USDA between 1995 and 2004, corn drew $41.8 billion - more than cotton, soy, and rice combined."


"Cheap corn, underwritten by the subsidy program, has changed the diet of every American. It has allowed a few corporations - including Archer Daniels Midland, the world's largest grain processor - to create a booming market for high-fructose corn syrup. HFCS now accounts for nearly half of the caloric sweeteners added to processed food, and is the sole caloric sweetener for mass-market soft drinks. Between 1975 and 1997, per-capita consumption jumped from virtually nothing to 60.4 pounds per year -- equal to about 200 calories per person, per day. Consumption has generally hovered around that level since.

According to Drewnowski and his student Pablo Monsivais, cheap and abundant additives such as HFCS allow manufacturers to sweeten food liberally without adding much to their production costs. For people on a tight budget, these additives can also make cheap food the most efficient way to get calories."

The subsidies don't even benefit local farmers, but end up in the pockets of agribusinesses like Archer Daniels Midland and Cargill. Just to summarize some of the problems caused by corn subsidies:

  1. By making corn sweeteners essentially free, subsidies encourage over-use of these sweeteners by American food producers, thus leading to cheap high-calorie, low-nutrition food, which is causing an epidemic of heart disease and diabetes amongst the poor.

  2. Also by making corn sweeteners essentially free, subsidies impoverish third-world food producers, whose sugar-cane sugar can't compete with American corn syrup.

  3. The need to use up the subsidized corn, corn which wouldn't have been produced without the subsidies, has led to the new fad of corn ethanol, a bad idea which is allowing oil companies to pretend to be concerned about the environment. This allows them to put off consideration of proper alternatives like conservation.

  4. ADM and Cargill are big players in the Mississippi barge business. The subsidies lead to over-production which is dealt with by shipping the products on agribusiness-owned barges down the Mississippi. The Mississippi has been turned into the world's largest man-made object by the Army Corps of Engineers, spending hundreds of billions of dollars and massive amounts of energy all in aid of the agribusiness profits. This meddling with the Mississippi led directly to the Katrina disaster in New Orleans.

You can get an idea of why I don't like corn and other agricultural subsidies.