Freeman

ARTICLE

Just Say No to Farm Subsidies

J. Sterling Morton Was a Principled Free-Market Advocate

SEPTEMBER 01, 1995 by LAWRENCE W. REED

Congress is busy tying itself in knots of anguish over the future of federal farm subsidies. Many lawmakers are unwilling to stand up to the farm lobby and do what’s right. But exactly 100 years ago, one Secretary of Agriculture had the courage to do just that. His name was J. Sterling Morton, and he served in the second administration of President Grover Cleveland.

With the encouragement of his grandfather and uncle, young Morton devoured the writings of economist Adam Smith and statesman Thomas Jefferson. He became a staunch proponent of their ideas of free markets and limited government by the time he went to college in his home state of Michigan. The notion that no free society could survive if government started redistributing the people’s wealth became a life-long guiding principle for Morton. A strong advocate of voluntarism, not more centralized political power, he was the man who originated Arbor Day in 1872 to encourage private citizens to plant trees.

In the late 1890s, when the Democrats were the party of free trade, Morton was three times the Democratic candidate for Governor of Nebraska. In 1892, when Grover Cleveland recaptured the White House for the Democrats, he chose J. Sterling Morton to be his Secretary of Agriculture and gave him a free hand to liberate farming from the federal dole.

Noted economic historian Burton Folsom has written that Morton proved to be as principled a free market advocate as the President who appointed him. “In his four years as Secretary,” Folsom observes, “he chopped almost 20 percent from his department’s budget. He fired unproductive bureaucrats, starting with a man who held the job of federal ‘rainmaker.’” Then he slashed the travel budget: if farmers wanted to hear a spokesman from Washington, they would have to pay the bill to send him.

“If the Department of Agriculture is to be conducted in the spirit of paternalism, the sooner it is abolished the better for the United States,” Morton declared. Accordingly, he cut farm subsidies wherever the law gave him the authority. He reduced the government’s role in beet sugar production with these words: “Those who raise corn should not be taxed to encourage those who desire to raise beets. The power to tax was never vested in a Government for the purpose of building up one class at the expense of other classes.”

In 1895, Morton ended the free seed program. For 60 years, the government had sent free seed to farmers. But many farmers didn’t even use the seeds; in fact, fewer than one person per thousand even acknowledged receiving them. “Is it a function of government to make gratuitous distribution of any material thing?” Morton asked. He called free seeds a “gratuity, paid for by money raised from all the people, and bestowed upon a few people.”

In a biography of Morton, historian James C. Olson writes:

 

Every bill to appropriate money for special purposes was looked upon suspiciously by the Secretary. If it could not run the gamut of rigid laissez faire, if there was the slightest danger that it would extend the functions of the government, if it was paternal in any aspect, the Secretary of Agriculture was against it. When, for example, J. Z. George, Chairman of the Senate Committee on Agriculture and Forestry, asked his opinion on a bill to appropriate money for the extermination of the Russian thistle in the states of the Northwest, Morton asked in return whether it was “the business of the Government of the United States to make appropriations out of which men, women, and boys are to be hired, at wages fixed by law, to exterminate weeds, called Russian thistles, any more than it is the business of that Government to prescribe the manner of plowing, planting, and cultivating cereals, cotton, and tobacco, and to limit the wages to be paid cultivators?”[1]

Those who favored subsidies and business as usual were aghast at Morton. They wrote him vitriolic letters and filled newspapers with their attacks on him. Many urged President Cleveland to fire Morton, but the President was elated with the cost savings his agriculture secretary was achieving. This was the President who had once vetoed a $10,000 appropriation for drought-stricken farmers in Texas by declaring, “ . . . though the people support the government, the government should not support the people.”

Morton himself challenged his critics. He called the pro-subsidy Granger Society a “bunko establishment.” He urged a farmer in Iowa to quit “plowing with preambles, planting with resolutions, and gathering by legislative enactment” and get on with the business of an honest day’s work. His battles with lobbyists and the millions of dollars he saved became almost legendary in Washington.

When Morton left the nation’s capital in 1897, the subsidy crowd slowly returned. Free seeds were again distributed. By the 1930s, the federal government was paying some farmers not to produce at all. By the 1950s, even mohair producers were getting federal handouts. Today billions are doled out to subsidize a wide range of farm commodities, and it seems farmers sometimes produce as much for the government as they do for the market. Many agricultural economists believe that farm subsidy programs actually increase instability in the industry because the rules governing them change so often.

The experience of New Zealand is instructive: after that country abolished all farm subsidies in 1986 with a mere eight months’ notice, the farm economy improved and output rose. The awful predictions of the subsidy-seekers that disaster would ensue never materialized.

Author Osha Gray Davidson, writing in the January 4, 1993, New York Times, termed the U.S. farm subsidy program “hopelessly outdated, exorbitantly expensive and environmentally and socially devastating.” Far from “saving the family farmer,” they price American produce out of world markets, hurt low income families, and swamp the farmer with endless regulations. “A whopping 73 cents of every farm program dollar,” Davidson noted, “ends up in the pockets of 15 percent of the nation’s superfarms.” In other words, the large and well-off get the biggest checks, while their smaller competitors get a pittance in cash for the strangling controls subsidy brings. Because of these realities, there may be considerably more support for the abolition of subsidies among farmers themselves than is generally believed.

As Congress tries to muster the courage to challenge the government’s destructive role in agriculture, its members ought to look to J. Sterling Morton for inspiration. One hundred years ago, he didn’t waffle on the issue; he knew what had to be done, and to the extent the law allowed him, he did it with a flourish. []


1. James C. Olson, J. Sterling Morton: Pioneer Statesman, Founder of Arbor Day (Lincoln, Nebraska: University of Nebraska Press, 1942), pp. 358-9.

ASSOCIATED ISSUE

September 1995

ABOUT

LAWRENCE W. REED

Lawrence W. (“Larry”) Reed became president of FEE in 2008 after serving as chairman of its board of trustees in the 1990s and both writing and speaking for FEE since the late 1970s. Prior to becoming FEE’s president, he served for 20 years as president of the Mackinac Center for Public Policy in Midland, Michigan. He also taught economics full-time from 1977 to 1984 at Northwood University in Michigan and chaired its department of economics from 1982 to 1984.

comments powered by Disqus

EMAIL UPDATES

* indicates required

CURRENT ISSUE

December 2014

Unfortunately, educating people about phenomena that are counterintuitive, not-so-easy to remember, and suggest our individual lack of human control (for starters) can seem like an uphill battle in the war of ideas. So we sally forth into a kind of wilderness, an economic fairyland. We are myth busters in a world where people crave myths more than reality. Why do they so readily embrace untruth? Primarily because the immediate costs of doing so are so low and the psychic benefits are so high.
Download Free PDF

PAST ISSUES

SUBSCRIBE

RENEW YOUR SUBSCRIPTION

Essential Works from FEE

Economics in One Lesson (full text)

By HENRY HAZLITT

The full text of Hazlitt's famed primer on economic principles: read this first!


By FREDERIC BASTIAT

Frederic Bastiat's timeless defense of liberty for all. Once read and understood, nothing ever looks the same.


By F. A. HAYEK

There can be little doubt that man owes some of his greatest suc­cesses in the past to the fact that he has not been able to control so­cial life.


By JEFFREY A. TUCKER

Leonard Read took the lessons of entrepreneurship with him when he started his ideological venture.


By LEONARD E. READ

No one knows how to make a pencil: Leonard Read's classic (Audio, HTML, and PDF)