Subsidy Buffet for Agribiz, Table Scraps for Good Food
Analysis of the pending 2012 Farm Bill
By Kari Hamerschlag
May 3rd, 2012
A version of this piece originally appeared in Environmental Working Group: Agriculture.
The farm bill draft released by the Senate Agriculture Committee last week (April 20) falls far short of providing farm and food policies Americans want. In a national poll last year, 78 percent said making nutritious and healthy foods more affordable and accessible should be a top priority in the farm bill. They’re going to be sorely disappointed. If it passes, this agribusiness-as-usual proposal will largely perpetuate our broken food and agriculture system, leaving in its wake a long legacy of poor health and degraded soil, water and habitat, especially in the industrial agriculture heartland.
Without the efforts of Sen. Debbie Stabenow (D-Mich.), the chair of the committee, the bill would have been even worse, but as it is, the proposal will continue to give away tens of billions of taxpayer dollars in subsidies to the nation’s largest, most profitable and environmentally damaging farm businesses. To pay for this giveaway, the Agriculture committee’s proposal would slash programs for conservation, nutrition, rural development and beginning and socially disadvantaged farmers.
That’s exactly what Americans in the poll said they don’t want.
An All-You-Can-Eat-Buffet for the Subsidy Lobby
The committee could simply have ended the widely discredited direct payment program and redirected the money to healthy food or conservation programs that benefit the public and save money in the long run. Instead, legislators created an expensive new entitlement program (called “shallow loss”) that guarantees nearly 90 percent of the income of farm businesses already enjoying record profits. It also leaves untouched a bloated $9-billion-a-year crop insurance program that pays about 60 percent of farmers’ crop insurance premiums, no matter how large the farm, and sends billions to crop insurance companies and their agents.
Most of the benefits of these proposed programs would flow to the big five commodity crops (corn, soy, cotton, rice and wheat) that provide feed for livestock, raw material for processed food and corn ethanol fuel for our cars. Not only would these proposals be highly inequitable and wasteful, but the new revenue guarantees, combined with unlimited insurance subsidies and high crop prices, will create powerful new incentives for growers to plow up fragile wetlands and grasslands and erase many of farming’s recent environmental gains.
Table Scraps for Good Food
With most of the savings from ending direct payments being poured into even more wasteful programs, there is little left for anything else. When it comes to promoting better food, the bill would provide a few additional important scraps. There’s $20 million a year for promoting local food; $10 million for Community Food Projects; and $20 million for the Hunger-free Communities Program to create incentives for SNAP (food stamp) recipients to buy healthy food at farmers’ markets. But the committee also cut $4 million from organic research funding (to $16 million a year) and cut funding to support Beginning Farmers in half, to $10 million. Never mind that we have a serious shortage of young farmers and the average age of all farmers is hovering around 57.
The fruit, nuts and vegetable sector is generally happy with their scraps, which add up to an extra $75 million a year, mostly for marketing and research. Yet few of the no-cost policy changes outlined in the Local Farms, Food and Jobs Act [introduced recently by Rep. Chellie Pingree (D-Maine) and Sen. Sherrod Brown (D-Ohio)], which would help build local food systems and expand access to healthy and sustainable foods, made it into the bill.
Modest Trims to Lavish Subsidies Could Easily Pay For Good Food.
According to a recent Government Accountability Office report, simply capping crop insurance premium subsidies at $40,000 per farm could yield as much as $10 billion in savings over 10 years. This would be nearly enough to spare conservation and anti-hunger programs from the proposed cuts while affecting just 4 percent of the subsidy recipients, who currentlycollect more than 30 percent of the total!
According to the same report, reducing the average crop insurance premium subsidy by 10 percent might save another $10 billion over 10 years. This would be more than enough to significantly pay down the deficit and cover the modest $200 million annual cost of the Local Farms, Food and Jobs bill and the Beginning Farmer and Rancher bill.
A portion of that subsidy savings could also be used to not just restore but actually double funding for organic agriculture, reinstate funding for the socially disadvantaged farmer program cut by the committee and double the number of low-income schools participating in the Fruit and Vegetable Snack program.
Watch for the Budget Deficit Smokescreen
In spite of the committee bill’s major flaws, outrage from good food advocates has been muted thus far, in part because expectations were exceptionally low.
The overriding message from Congress, meekly accepted by too many, is that the current budget-cutting climate makes it impossible to expect new money for nutrition, conservation, local, organic and healthy food, no matter how valuable (and oversubscribed) these programs are. All we can hope for, they say, is to hold onto current funding or minimize cuts.
But the nation’s difficult fiscal situation shouldn’t get all the blame. The main culprit is the farm lobby’s stranglehold on the majority of Senate and House Agriculture Committee members and the unwillingness of those who would prefer a reform-oriented farm bill to seriously challenge Congress to do better.
Disregard the Coming Spin
As the farm bill moves to the Senate floor, there will be lots of spin-doctors proclaiming that this is the best that can be expected in the current fiscal climate. But if the goal is really to save money and invest wisely, it makes no sense to give away unlimited crop insurance premium subsidies to wealthy farm operators at the expense of feeding hungry people, protecting our water and investing in healthy food.
It will not be easy to break the farm lobby’s long-standing grip on Congress. But it is certainly not going to happen if we stay silent. It’s time to pick up the phone and let your representative and senators know that you want a fair farm bill that invests in a healthier food system for you and your family.
Kari Hamberschlag is Senior Food and Agriculture Analyst for the Environmental Working Group, where she focuses on healthy, local, organic and sustainable food and agriculture policy. Prior to joining EWG, she worked for nearly a decade with a number of non-profits on fair trade, sustainable food and ag policy issues.