In the past, opposing agricultural subsidies was anathema to any candidate seeking electoral success in the Midwest, and especially in Iowa, the home of the first caucus in the process that chooses each party’s presidential nomination. Back in 2008, Iowans were overwhelmingly in favor of ethanol and the economic benefits it brings. Accordingly, the candidates supported it, too, and the debate among the candidates was settled before it began.
Yet in this election cycle, something seems to have changed. Former Minnesota governor and Republican presidential nominee contender Tim Pawlenty captured national headlines by advocating an end to ethanol subsidies in his speech formally announcing his candidacy. While shocking in its own right, the speech took place in Iowa, of all places. Imagine going to a baseball game and suggesting in increase in prices of peanuts and cracker jacks. Imagine going to the movie theater and telling people that $5.75 is too low a price for a small popcorn–$9.75 is more appropriate. Nothing is more American than subsidies for agriculture—especially corn. Yet Pawlenty was going to slaughter the sacred cow.
Some of the responses were predictable. The Iowa Renewable Fuels Association gave support for a general decrease in subsidies, but it felt unfairly targeted. Its president, Walt Wendland, said that he would “…look forward to Governor Pawlenty further detailing his plans to ‘phase out’ petroleum subsidies, perhaps in a speech in Houston, Texas,” a reference to the importance of oil to the Texan economy. Mitt Romney, another Republican contender, said that he “support[s] the subsidy of ethanol”—no uncertain terms there. Iowa is an important state for Mr. Pawlenty. He has not hid the fact that he plans to be a major player in Iowa, using a victory there as a jump-start for the rest of his campaign. Was he jeopardizing his campaign as soon as he started it?
Apparently not. What might have looked like a liability in Iowa was turning into an asset elsewhere. Instead of the hammering that might have been expected, Pawlenty was also catching some praise. The Wall Street Journal editorial page, a consistently right-leaning body, praised his boldness, writing that he “has passed an early test of fortitude.” The reddest of red blogs praised Mr. Pawlenty, calling him “an adult in the room.” Mr. Pawlenty pressed on, saying the next day that he would be willing to end all federal subsidies if that is what is needed; the argument was “not just about ethanol.”
That could have been the end of it. But then the story got bigger. Sarah Palin, a former energy-state governor (Alaska), commentator on Fox News and potential Presidential candidate, said that she thinks that, “all our energy subsidies need to be re-looked at and eliminated.” Her reasoning was simple: “[B]ottom line, we can’t afford it.” Former ambassador to China Jon Huntsman, another potential contender, said that even if the subsidies are popular, we need to think about ending them.
The language of cost-cutting has always been about eliminating waste and reducing fraud. Some politicians never got past that point. Those politicians who admitted (as is glaringly obvious) that such small steps couldn’t in a million years balance the budget rarely discussed what changes should actually be made. The problem with making real changes is that it makes people angry. A rule of politics is that once a benefit is given to someone, it becomes almost impossible to take away—at least without a perfunctory period of kicking and screaming. It is one of the (many) reasons that it is so much easier to increase spending rather than decrease it.
Yet the same backlash has not occurred here. A once-unfathomable position for a presidential candidate to adopt has been championed by a candidate and has received support from several others. There are still holdouts, but candidates will not be able to demonize one particular candidate in Iowa like might have at one time happened. A politician has finally proposed a true cost-cutting measure—and it looks like it just might have some hope.
What could possibly have caused such a sea change in opinion from just four years ago, when then-Senator Obama brought his message of peace, security, and corn to Iowa and the nation in his successful bid to take the White House? One factor has to be the influx of very conservative members of Congress, elected in a wave of anti-government spending sentiment. They made no secret of their desire to end the tax credit to Big Corn, even though the position could have been considered politically risky.
Yet what was different in this particular instance is that the position was not politically risky. The clear sentiment was in favor of getting rid of this money for special interests just like this one. Lawmakers around the country were more likely to face harsh questioning back at home by continuing to prop up these and other subsidies than they were by maintaining the status quo. Chuck Grassley, the senior Republican Senator from Iowa, has even proposed legislation to slowly phase out agricultural subsidies, including those subsidies that benefit his own state.
This article is not designed to be a praise of the Tea Party; rather, it is using the Tea Party as proof that painful cuts can still garner significant support. Rarely do people get elected with the promise of cutting their own constituents’ benefits. We will have to wait to see if these cuts remain on the table once the true effects become known, but for once, we have a reason to be optimistic about the chances of cutting market-distorting subsidies. Mr. Pawlenty was hopefully being serious when he said that ethanol was not the only culprit; the system was the bigger problem. He sounded ready to try to tackle a daunting challenge. Perhaps it is a harbinger of a more conversation to come about how to fairly spread the inevitable economic pain that is still yet to come.
Photo courtesy of www.opensecrets.org.