BrianGarst.com

James Gibney of the Atlantic proposes making the actual cost of food apparent to the consumer by requiring labels indicating whether a product has either received government subsidy or benefited from anti-competitive tariffs.

Americans pay much more than they should for their food. Thanks to a thicket of subsidies and tariffs that support American farmers and tilt the growing field against cheaper foreign producers, we get ripped off twice: first as taxpayers who ante up for roughly $25 billion in agricultural subsidies each year ($4 billion for milk alone in 2006); then as consumers who pay higher prices at the checkout counter because we can’t take advantage of low-price imports.

…So, how can we get more Americans to look up from their feedbags and demand that Congress restore some sense to the marketplace? I recommend a little truth-in-packaging. Just as food manufacturers now list their products’ ingredients and nutritional value, they should also disclose their “free-market” value.

To wit, every product whose ingredients benefit from a subsidy should include the following language on the label:

“This product has been subsidized by the U.S. government at taxpayer expense. For more information, please visit usda.gov.”

And every product that benefits from tariff protection should have the following language on the label:

“This product is protected from foreign competition by U.S. import tariffs. Its price is higher as a result. For more information, please visit usitc.gov.”

Now there’s a regulation that makes sense.  That, unfortunately, also means it will never happen.

I must take issue with one thing Gibney says, though.  He says “subsidies and tariffs were originally intended to help protect small farmers–a purpose they’ve largely outlived.”  The idea that they have “outlived” their purpose implies they once served any purpose beyond vote buying. This is a fiction.

Other than that minor quibble it’s an excellent post. I’d like to take the idea a step further and apply it to all products receiving government assistance. A good way to solve the problem of concentrated interests versus diffused costs would be to make people actually see the consequences of the bad policy coming out of Washington. Knowing their food has been made a little bit more expensive is one thing, but seeing that same little bit added to the hundreds of products they use every day would make them realize that it adds up mighty high.  But like I said, this will never happen. Forgive me for dreaming.

Hat tip: Cato@Liberty

subsidies tariffs