The Dream-50 Years Later
By Mark Edelman and Barry Flinchbaugh
© Copyright Agri-Pulse Communications, Inc.
ME. As a farm kid in grade school living in a single-parent household, I still remember Martin Luther King's, “I have a dream speech” - not so much for its racial implications, but because it provided hope for all Americans who didn't start out with much, but had a dream of equal opportunity in the pursuit of happiness. It was a promise that if you worked hard, applied your smarts, and were judged by your character--instead of whether or not you were born with a silver spoon-you had a good chance of succeeding in life.
BF. The 1960s and 70s, saw unprecedented numbers of farm kids going to college for two reasons, the baby-boom generation added a third more kids for the age cohorts of the 1945-1960 period and education was seen as a great “equalizer” for families whose parents grew up during the Great Depression. They wanted upward mobility in terms of employment, income, and economic freedom for their kids. Equal educational opportunity was seen as a pathway open to all in pursuing the “American Dream.”
ME. In the 1970s, my college professor explained the founding public policy principles in the American experiment with the simple phrase: “to each according to ability, above minimum need.” In other words, we were all free to work hard and pursue economic opportunity with no guarantee of success. Our economic system rewarded those who were productive, had ability to assess market opportunities, take risks, and satisfy market demands at a price that buyers were willing and able to pay. Our public policy set aside resources to provide for the minimum needs of those who were disabled, too young, or too old to work, or those unemployed and unable to work through no fault of their own.
BF. I remember those lectures, and from time to time, we do debate and redraw the lines of compromise on minimum needs and upward mobility. Over the years, our economic policy had incorporated a number of “entitlements and automatic stabilizers” like public assistance and food stamps which increased government deficits during recessions. And yes we expanded food stamp eligibility with the stimulus. The policies helped stabilize the economy and prop up consumer demand during a slow recovery. Spending on these items typically decline as the economy improves. I also said no system is perfect and there will always be a certain amount of “waste, fraud, and abuse.”
ME. Based on recent media reports, there appears to be less fraud and abuse in the SNAP food stamp program than likely exists in the crop insurance program. This rub has been elevated into public focus with passage of the ag-related titles while leaving food programs undone. Even though farmers pay premiums for crop insurance, the popular adjudication by the media and public is a picture of Congress approving assistance to farmers with average incomes of $90,000 while separating out and not passing funding food for children and single mothers from households with average incomes of $20,000.
BF. Only someone who wants to kill the “farm bill” and defeat the food and farm coalition that supported it for decades could have dreamed up this scenario. Surmising from the statements of Committee leaders, fingers are pointing to House Majority Leader, Eric Cantor. But our system of government is such that one person cannot do much in Congress. There are 80 representatives-a minority of the 435 House Members--who are willing to shut down government if they don't receive the reductions in appropriations that they want. Many are also the leaders who led the House vote to double down on $40 billion in cuts to food programs, after the House Ag Committee approved $20 billion in cuts in a bi-partisan bill, and the Senate passed $4 billion in cuts in a bi-partisan bill.
ME. Perhaps we will see how far the political pendulum swings in the process. Florida Representative Southerland recently suggested SNAP food stamps should be transferred from USDA to HHS. If 80 percent of USDA's budget is eliminated, some will ask whether USDA has enough political clout left to be sustained separately and suggest it become part of the Department of Interior or Commerce. If government eliminates crop insurance subsidies, look for the private sector to become more involved. Externalities will be internalized by the industry. If independent farmers cannot manage risks with insurance, perhaps agribusiness with sufficient capital, precision agronomics and weather data will manage supply chain risk from genetics to end markets with producer contracts.
BF. Another policy class lecture focused on those who espouse the virtues of competition and the free market system. In many cases, those with the loudest calls for free markets and free enterprise are also those who favor competition for everyone but themselves. Some billionaires under our representative democracy and market-oriented private enterprise system become humanitarians who pledge to give back half of their wealth to philanthropic causes. However other notable billionaires spend their wealth on political agendas to influence public policies in order to fortify their economic status.
ME. To make matters worse, we often know more about news around the world than in the neighborhood. In my rural community, local church volunteers receive a government grant to feed daily lunches to nearly a hundred low income kids during the summer so they have access to a nutritious meal. This highlights that even in rural America, food security and food bank supplies have not responded with economic growth as post-recession unemployment rates declined. I used to think that all rural communities were like my hometown. But rural America is diverse and changing. Even in Iowa, some rural communities have household incomes that average upwards of $60,000 while others are near $30,000. Issues of chronic or temporary poverty are not confined to metro areas.
BF. The roots of the past two centuries of progress in the U.S. standard of living can be traced to innovation and productivity in agriculture, industry, and information systems which allowed the middle-class to emerge. The American Dream was fostered by mobility and opportunity to move up and down the income ladder. It would be an unfortunate legacy to be the first generation in our modern affluent society to accept persistent increases in hunger and poverty as a matter of policy or to erode important investments in the “seeds” of innovation and opportunity that hold the promise for future economic advancement.
* Edelman is a professor of economics at Iowa State University and Flinchbaugh is an emeritus professor of agricultural economics at Kansas State University.