Help the poor?

By Dale E. Landrith Sr. | Jun 06, 2019

Who are the poor? I would define the poor as those who must take a disproportionate part of their regular income – wages, food stamps, financial assistance, etc. – to purchase basic necessities for their families. "Basic necessities" would be defined as food, housing and transportation. Politicians love to talk, especially in print or news media, about how much they care about the poor and are trying so very hard to help them. Are they helping?

We recently traveled to South Carolina for a couple of weeks. We tow a travel trailer so that “home” is always with us. Needing to sustain ourselves, we had to do some grocery shopping. There were some eye-opening results. A South Carolina Walmart sold a gallon of milk for $1.52, a box of Post Raisin Bran for $2.78, and a case of bottled water for $1.78. We regularly shop at Walmart here in Thomaston. Milk at that time was about $3.30, same brand and box of cereal was $3.12, and the same case of bottled water was $3 and something. The explanation for cereal and water escapes me, except for the fact that it is well known that the cost of business regulation is much higher in Maine.

There is nothing more basic to feeding a family than milk. How could milk be twice as much in Maine as in South Carolina? The answer is politics. Maine government ensures that the Maine dairy industry receives a minimum amount for the milk it produces. In addition Maine sets a minimum price at which milk can be sold. The Maine dairy industry does not have to be efficient, since government is choosing to support it. In addition to the price supports, government eliminates competition. The net result is that those who need a basic commodity, milk, are forced to pay more than would be necessary. However, what about the poor farmer? Somehow, the dairy farmer in South Carolina is managing to do sufficiently well. I seriously doubt that the South Carolina cows care for and milk themselves. Government should get out of the way and let the market set the price of milk and any other product.

On our trip we also noticed that in Pennsylvania, the price of gasoline was significantly higher than in states before and after. What is the culprit here? A little research shows that Pennsylvania recently raised its gasoline tax so that it is now the highest in the nation. In New Jersey, the price was $2.69/gallon and in Pennsylvania it was $2.99/gallon. On a more recent trip the price of gasoline was $2.43/gallon in Ohio and $2.89/gallon in Pennsylvania. I travel regularly to the Midwest and now do not purchase gasoline in Pennsylvania unless absolutely necessary. What are the consequences of this to businesses in Pennsylvania? There are no restaurant or convenience store purchases at the affected businesses and zero gasoline tax to the state.

How does this relate to Maine? In the last few months we have had proposals to raise the state gasoline tax. There has also been a proposal to circumvent state gasoline tax and instead tax every Mainer for the miles they drive. These proposals from Maine politicians serve to increase the burden on the poor. For most everyone gasoline is integral to transportation for employment, for trips to the grocery store and many other endeavors.

One of the most basic commodities is electricity. With Central Maine Power, we currently pay around 17 cents/kilowatt hour and there have been substantial increases in the last few years. The national average is about 13 cents/kilowatt hour. Do politics affect electricity cost? Most certainly they do. Quebec currently has vastly more electricity available than it can consume. This is the reason for the current “corridor” controversy.

Quebec produces this electricity by hydro-power. Why send cheaper electricity to Massachusetts via the “corridor” and yet have none of that completely renewable, clean, cheap electricity benefit Mainers? The answer is that a few years ago Maine politicians mandated that there be a maximum amount of this clean hydroelectricity that could be brought into Maine from Quebec. This mandated maximum was done to keep rates high enough so that wind energy would be economical. The wind energy folks have made huge amounts of money while the poor have subsidized their efforts. Think Angus King. By encouraging Quebec hydro for Maine, politicians could lower electric rates significantly.

How can politicians truly help the poor as defined above? They must eliminate the programs and regulations that discourage productivity or inhibit business expansion. When business is faced with competition, it either responds with more innovation or fails, and the result more often than not favors the consumer. Why does Walmart create easier shopping online and the ability to pick up your groceries in a drive-through? The answer is called Amazon.

Help the poor? Quit creating artificial costs on commodities, support an economy that gets the most people working, which will result in increased wages as competition for workers increases, and support business through reduced regulation. The federal government could eliminate oil company subsidies and price supports for agriculture. It is doing a good job on job creation and regulation. Maine government needs serious work on all three.

Comments (5)
Posted by: Francis Mazzeo, Jr. | Jun 09, 2019 14:55

Some of the higher cost in Maine has to do with transportation cost, heating and less people in a bigger state.



Posted by: RALPH WALLACE | Jun 08, 2019 09:59

Capt. Cut & Paste supporting a conservative view.  Mmmmmmm. I know the secret - a Trump-less column.



Posted by: Kenneth W Hall | Jun 07, 2019 13:47

Have to smile at Dale and Ron being in the same book....saying nothing about being on the same page!  LOL



Posted by: Ronald Horvath | Jun 06, 2019 18:43

For once I almost agree with Dale (on one thing at least/.  Here's a little info, Mary, on those government subsidies and the results.

 

"The decrease in family farms is the  result of the Farm Bill, a bill Congress has renewed every five years since 1933.22 The Farm Bill harms the agricultural environment through its subsidy program,which provides government money to farmers that grow certain types of crops. These crops sell at an artificially low price because the subsidy payments make up the price  difference to the farmers. The problem with this program is that five crops control the subsidy market -corn, cotton, rice, soybeans, and wheat -and these crops are predominantly controlled by large corporations. This subsidy program has "snowballed into a legislative package of subsidized commodities that increasingly benefit the largest of agricultural producers." As a result, family farmers receive little or no assistance in the form of subsidies and are forced to struggle to survive. This program has "transformed rural America into a waste-land of large commercialized farms and  abandoned fields that once served as symbols of hope to the families that depended on their plentiful yields."

 

"The Farm Bill's success continued until World War II. By this time, modern technology developed, leading to new pesticides, herbicides, and agricultural mechanization. This new technology led to overproduction and depressed crop prices, similar to the farm crisis during the Great Depression. The government, however,did not decide to step in and save the small farmers. Instead, larger  farms that had the ability  to stay afloat despite decreased crop prices began to exploit the weaker, smaller farms by purchasing foreclosed farms at below-market rates and by joining forces with other large farms and food processors to create the first agribusiness  lobby. As time went on, things only worsened for small, family farms. Agribusiness grew and created an incredibly powerful lobby that crafted favorable federal farm policies.

 

Agribusiness received its greatest support when President Richard   Nixon  appointed Earl Butz as his second Secretary of Agriculture. Secretary Butz believed that farmers needed to "get big  or get out" and"plant their fields from "fence row to fence row." His beliefs permeated the policies that he  enacted. Secretary Butz had an "adapt or die" mentality, giving the growing agribusiness industry the strength to overpower unprofitable small farms that could no longer compete in  the market. Secretary Butz's aggressive policies led to forest decimation and the draining of critical wetlands, "frequently with direct assistance and financial support from the  [United States Department of Agriculture] ." Additionally, his policies pushed farmers to use a higher amount of toxic chemicals, causing increased watershed pollution and damage to plant and animal health. These policies focused on large-scale industrial farming, forever transforming America's agricultural system and the rural landscape, which previously contained profitable small farms.

 

"As time went on, the United States' agricultural policy began to rely heavily on farm subsidies. From 1970 to 1986, direct government payments to farmers increased from $3 billion dollars a year to $26 billion dollars a year. In 2002, a new Farm Bill was enacted and "repositioned U.S. Agribusiness as America's largest corporate welfare recipient  and officially discarded any attempt to deregulate the agricultural economy."

 

"The dramatic shift from small farms to large, factory-type farms led to a great deal of legal and environmental issues. These issues include disputes over soil erosion and sedimentation; water pollution through runoff from fields and livestock operations; chemical air pollution; inhumane animal management practices; and others. The U.S. Farm Bill's use of ever-increasing subsidies produced these issues through its encouragement of large-scale, mono-culture megafarms."

 

Melanie J. Wender, Goodbye Family Farms and Hello Agribusiness:The Story of How Agricultural Policy is Destroying the Family Farm and the Environment
https://digitalcommons.law.villanova.edu/cgi/viewcontent.cgi?article=1016&context=elj

 



Posted by: Mary A McKeever | Jun 06, 2019 15:41

Price supports for agriculture caught my eye. I remember years ago a farmer I knew put his land on hold for subsidies, as he made more money NOT farming his land. I guess I live by the creed that a good Down East Yankee should earn his living not let the government do it for him/her.



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