_“... supervision of agriculture and other concerns of a similar
nature ... which are proper to be provided for by local legislation,
can never be desirable cares of a general jurisdiction. It is
therefore improbable that there should exist a disposition in the
federal councils to usurp the powers with which they are connected;
because the attempt to exercise those powers would be as troublesome
as they were nugatory.”_ Alexander Hamilton in the Federalist Papers,
No. 17.
Hamilton was wrong in his prediction as to what men would do, but
quite right in foreseeing the consequences of their foolhardiness.
Federal intervention in agriculture has, indeed, proved “troublesome.”
Disregard of the Constitution in this field has brought about the
inevitable loss of personal freedom; and it has created economic chaos.
Unmanageable surpluses, an immense tax burden, high consumer prices,
vexatious controls--I doubt if the folly of ignoring the principle of
limited government has ever been more convincingly demonstrated.
We have blundered on so grand a scale that even our critical faculties
seem to have been damaged in the process. No man who is familiar with
the subject will deny that the policy of price supports and production
controls has been a colossal failure. Yet, today, some of our best
minds have no better solution to the problem than to raise the supports
and increase the controls!
The teaching of the Constitution on this matter is perfectly clear.
_No power over agriculture was given to any branch of the national
government._ The sponsors of the first Agriculture Adjustment Act,
passed in 1933, tried to justify the law under the so-called general
welfare clause of the Constitution. The Supreme Court promptly struck
down that legislation on the grounds that the phrase, “general
welfare,” was simply a qualification of the taxing power and did not
give Congress the power to _control_ anything. “The regulation (of
agricultural production),” the Court said in United States v. Butler
(1936) “is not in fact voluntary. The farmer, of course, may refuse to
comply [a privilege not given him under present legislation], but the
price of such refusal is loss of benefits ... the power to confer or
withhold unlimited benefits is the power to coerce or destroy....”
The New Deal Congress replied by enacting substantially identical
legislation, the second AAA, and now sought to justify the program
as a “regulation of interstate commerce.” This was a transparent
evasion of the Butler case; but the Supreme Court, which by this time
was under heavy political fire for having thwarted the “Roosevelt
Revolution,” made one of its celebrated about-faces and upheld the new
act. The federal government has usurped many powers under the guise
of “regulating commerce,” but this instance of distorting the plain
meaning of the Constitution’s language is perhaps the most flagrant on
record.
In the case that upheld the second AAA, _Wickard_ v. _Filburn_, (1942),
a farmer had been fined for planting 23 acres of wheat, instead of the
eleven acres the government had allotted him--notwithstanding that the
“excess” wheat had been consumed _on his own farm_. Now how in the
world, the farmer wanted to know, can it be said that the wheat I feed
my own stock is in interstate commerce? That’s easy, the Court said. If
you had _not_ used your own wheat for feed, you might have bought feed
from someone else, and that purchase might have affected the price of
wheat that _was_ transported in interstate commerce! By this bizarre
reasoning the Court made the commerce clause as wide as the world
and nullified the Constitution’s clear reservation to the States of
jurisdiction over agriculture.
The tragedy, of course, is that the federal government’s
unconstitutional intrusion into Agriculture has not brought us any
closer to a solution of the “farm problem.” The problem, when federal
intervention began, was declining farm incomes. Today, many farm
incomes are still low. But now we have additional problems--production
controls that restrict freedom, high consumer prices, huge crop
surpluses and a gigantic tax bill that is running close to six billion
dollars a year. No matter what variant of the price support-production
control approach we adopt, the solution to these problems continues to
elude us.
The reason government intervention has created more problems than it
has solved is quite simple. _Farm production, like any other production
is best controlled by the natural operation of the free market._ If the
nation’s farmers are permitted to sell their produce freely, at price
consumers are willing to pay, they will, under the law of supply and
demand, end up producing roughly what can be consumed in national and
world markets. And if farmers, in general, find they are not getting
high enough prices for their produce, some of them will move into other
kinds of economic activity. The result will be reduced agricultural
production and higher incomes for those who remain on the farms. If,
however, the government interferes with this natural economic process,
and pegs prices higher than the consumer is willing to pay, the result
will be, in Hamilton’s phrase, “troublesome.” The nation will pay
exorbitant prices for work that is not needed and for produce that
cannot be consumed.
In recent years, the government has sought to alleviate the problem
of over-production by the soil bank and acreage retirement programs.
Actually, these programs are simply a modern version of the hog-killing
and potato-burning schemes promoted by Henry Wallace during the New
Deal. And they have been no more successful in reducing surpluses
than their predecessors. But there is also a positive evil in these
programs: in effect, they reward people for _not producing_. For a
nation that is expressing great concern over its “economic growth,” I
cannot conceive of a more absurd and self-defeating policy than one
which subsidizes non-production.
The problem of surpluses will not be solved until we recognize that
technological progress and other factors have made it possible for
the needs of America, and those of accessible world markets, to be
satisfied by a far fewer number of farmers than now till the soil. I
cannot believe that any serious student of the farm problems fails to
appreciate this fact. What has been lacking is not an understanding of
a problem that is really quite impossible not to understand, but the
political courage to do something about it.
Doing something about it means--and there can be no equivocation
here--_prompt and final termination of the farm subsidy program_. The
only way to persuade farmers to enter other fields of endeavor is to
stop paying inefficient farmers for produce that cannot be sold at free
market prices. Is this a cruel solution? Is it heartless to permit
the natural laws of economics to determine how many farmers there
shall be in the same way that those laws determine how many bankers,
or druggists, or watchmakers there shall be? It was never considered
so before the subsidy program began. Let us remember that the movement
_from_ the farm _to_ other fields of endeavor has been proceeding in
this country since its beginning--and with good effects, not ill.
I cannot believe that this course will lose politicians as many votes
as some of them seem to fear. Most farmers want to stand on their own
feet. They are prepared to take their chances in the free market. They
have a more intimate knowledge than most of us of the consequences of
unlimited government power, and so, it would seem, a greater interest
than most in returning agriculture to freedom and economic sanity.