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Farm Bill Needs To End Direct Payments, Add Environmental Requirements

October 30, 2013

corn_with_dollars

Readers of Caffeinated Politics have long seen a widget on the right-hand side of the blog alerting them to a site that showcases how too many farmers wind up farming the government treasury.  It is interesting to note that I have had conversations with real farmers who decry the abuse that happens with agriculture subsidies, and see a need for real reform when Washington crafts a new farm bill.

For instance a Monona man who farmed thousands of acres in three Wisconsin counties received  $32,000 in subsidies in 2010 and more than $1 million since 1995, according to  the Environmental Working Group, a nonprofit that tracks subsidies.  That is simply outrageous considering, as this editorial notes, that same Monona man lives in a $1.1 million home on the lake, begging the  question of need.

Members of the house and senate are sitting down and starting work at  creating, and hopefully passing, budget related bills that will address national requirements.    They are working on the farm bill and I am most pleased that there is movement towards a more sane approach to direct payments.   

Direct payments, farm subsidies that cost the government almost $5 billion annually, would be phased out in both bills, with the savings split between other subsidy programs and deficit reduction. Direct payments have been controversial because they are paid out every year regardless of crop prices or crop yield. The Senate bill would eliminate the program immediately, while the House bill would phase it out over the next two years for cotton farmers who rely on the program.

Meanwhile I am very interested in the proposed requirement that environmental standards be imposed for those who get crop insurance.

Both bills would increase subsidies for federally subsidized crop insurance and create a new crop insurance program that covers small revenue losses on planted crops. This revenue protection program favors Midwestern corn and soybean farmers and would be more generous in the Senate bill. The Senate bill also includes language that would lower government crop insurance subsidies for the wealthiest farmers — an amendment added on the Senate floor over the objections of Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich. In addition, the Senate bill includes language that would require farmers who get crop insurance to comply with certain environmental standards. House Agriculture Committee leaders are firmly opposed to that provision.

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