Saturday, June 18, 2011

Corny Capitalism

My commute to work is accompanied by a host of messages from advertisers, whether via radio ads during my drive to the train station, placards inside the commuter train, or a host of colorful signs and messages and even huge floor decals that grace the walkways of Washington’s Union Station.

This month’s billboards have been sponsored by a group called the “Corn Farmers Coalition”. Hmmm. It never occurred to me that busy commuters and travelers running to catch the Acela train or the Metro would be interested in corn. Yet the colorful billboards seem intent on presenting us with some interesting facts. For instance, did you know that 90% of all corn produced is grown on family farms? Well according to the USDA and the Corn Farmers Coalition, that is an important fact you ought to consider, and it is illustrated very nicely by the lovely picture that graces Union Station and the Corn Farmer’s Coalition Website. Isn’t that a nice family with the Dad holding up the big “90”, surrounded by his lovely wife and adorable kids in front of some tall stalks of corn on their idyllic farm?

Or did you know that American corn farmers are the most productive in the world, growing 20% more corn per acre than any other nation? Isn’t that special!?! This too is illustrated by a huge picture that greets me during my morning commute.

Okay, fine. Let’s grant for the sake of argument that all of this is perfectly true. The purpose of advertising is usually to persuade people to buy a product. I don’t think the people going through Union Station have any interest in buying a bushel of corn, or are even considering a career change to farming.

Of course, like a lot of advertising that targets DC audiences, the purpose is not to persuade you to buy corn, but to shape public policy. In this case, the Corn Famer’s Coalition was hoping to cut another good deal so the government would continue subsidizing ethanol production from corn. Except this time it didn't work.  According to yesterday's Washington Times:

Signaling that austerity is now the prevailing attitude on Capitol Hill, the Senate delivered a stunning blow to a once-sacrosanct program Thursday when it voted to end billions of dollars that go each year to producers of blended ethanol.

Reversing itself from just two days earlier and despite opposition from the White House, a bipartisan coalition voted 73-27 to halt the 45-cents-per-gallon tax credit, which was expected to total $5.7 billion in 2011.

Oh that the many other industries that inundate us with special interest advertising would suffer the same lack of success. The American Association of Railroads and present us with ads innumerable about how many tons of freight they can haul on a gallon of gas, how they keep the highways from being jammed and how much money they pump into the economy and how many jobs they create. Golly gee, that’s wonderful! If freight rail is so effective and efficient, I am sure it can carry on without help from the government. And the same is true for oil companies, banks, retail associations and any other trade association or lobby that is angling for government funding, tax breaks, preferential treatment or handouts.

In a case of very rare agreement with the Obama Administration, I believe that any and all tax breaks and subsidies to oil companies, whatever they are, should cease and desist right away. But the same should hold true for any subsidies, breaks or handouts to General Electric, General Motors, Chrysler, “green industries” or any other industry that is receiving help or preferential treatment from the government.

As a conservative, free market capitalist, I fully support the right of each and every one of these industries to thrive and even make a handsome profit, but they should do so in a free and open market on a level playing field. When the government pits one person or entity against another, subsidizing or giving special breaks to some sectors to the detriment of others, we no longer have a free market, but rather crony capitalism. Or should I say “corny” capitalism?

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