Posted on 02/14/2005 7:43:05 AM PST by 1rudeboy
They’re not ‘saving’ family operations – they’re actually contributing to their demise.
In 2003, Allen County farmers received about $7.5 million in subsidies from the federal government. The top 20 percent of producers – that was 653 of the 3,269 who got payments – received 82 percent of the money, for an average of $91,082 each. That included top recipient Henry Hilger & Sons at $123,176. The remaining 80 percent of the farmers got only 18 percent of the money, about $4,836 each, on average. That included recipient No. 2,184 Walter Langley, who got $12 for one acre he has farmed so he doesn’t have to mow it.
OK, go ahead now: Try to make the case, as so many in Washington have done so disingenuously for so long, that the point of agricultural subsidies is to “save the family farm.”
The truth is that such subsidies – mostly on commodities such as corn, soybeans, rice and cotton, in which farmers are paid the difference between the selling price and a government-set minimum – are accelerating the rate of disappearance of smaller farms. The bigger the farming operation, the more subsidy money and therefore profit; the big farms use that profit to buy smaller farms, which makes them eligible for even more money, which they can use to buy even more smaller farms.
President Bush, in announcing his new proposed budget, said he wants to cut payments to farmers by $587 million, or about 5 percent, next year, and save $6.7 billion in subsidies in the coming decade. He would do this principally by setting a firm limit of $250,000 a year for each individual subsidy. Theoretically, the current limit is $360,000 a year. But growers have found many ways around the limit (such as dividing one farm into several partnerships) and can get several times that amount; more than 70 get $1 million or more in subsidies.
The president’s intentions quickly got the attention of farming organizations. More than 100 of them, led by the American Farm Bureau Federation, said they would fight the proposal. The Indiana Farm Bureau’s president said the move is “ill-timed” and farmers “need a reliable safety net.”
It’s a pretty selective safety net, however. Nationwide, 10 percent of the farmers get more than 70 percent of the subsidies, a fact that causes the conservative Heritage Foundation to call farm subsides “America’s largest corporate welfare program.” Since farming households in general have higher incomes, greater wealth and lower consumption expenditures than most households, this creates a perverse anti-Robin Hood effect: The poor (relatively speaking) are being robbed to pay the rich.
“Any way you look at it,” Indiana U.S. Sen. Richard Lugar has noted, “this is a highly concentrated system of payments.” Lugar has been a longtime member of the Senate Agriculture Committee and in 2002 led an unsuccessful attempt to cap individual subsidies at $275,000. He also sponsored the 1996 Freedom to Farm bill, which would have gradually weaned farmers off subsidies altogether. But commodity prices dropped, “emergency appropriations” were approved, and there’s been no going back.
Until now. Considering the history of such proposals, it’s fair to say the president has an uphill battle. But he’s certainly right. Besides making a few rich farmers even richer, the subsidies don’t do much for the agricultural community. They keep land prices high, limit the entry of new farmers, make food more expensive than it should be and keep our farmers producing far more than we can eat in this nation.
Overproduction is an issue our trading partners keep trying, justifiably, to make an issue of. How can we make a persuasive moral case against a foreign government dumping, say, steel on us by subsidizing the producers when we’re doing the same thing with our agricultural products?
By the numbers
An organization called the Environmental Working Group has compiled an incredible farm subsidy database at www.ewg.org/farm/ at which you can find every recipient of a farm subsidy in the U.S. – and how much each has received in the nine years between 1995 and 2003. You can do the same thing for every recipient in Allen County or any county in any state. Using the database, you can make such comparisons as the following one.
Concentration of payments to farmers from 1995-2003:
U.S. – the top 10 percent of recipients got 72 percent of the payments, for an average of $309,823 each.
Indiana – the top 10 percent of recipients got 70 percent of the payments, for an average of $269,082 each.
Allen County – the top 10 percent got 68 percent of the payments, for an average of $149,985 each.
But Willie Green says subsidies make our sugar cheaper.
The government should stick to defending the rights of the citizens and stop interfering in businesses of any kind.
Your thoughts, please.
Get rid of the Chicago Board of Trade and the speculators in the market and you won't need gov. payments. As long as the producers can't set the prices they need for their crops, they most likely aren't going to be profitable.
Bush's proposal will do nothing to hurt 99% of the family farms.
Harangue the farmers if you must, but these bills ought to be labled, "Save the Farmland Banking Industry." In my No. Illinois area family corparations have led the farm consolidation and they have done it with the help of institutions willing to lend money rather freely. Take away the government juice and we will need John "Cougar" to do his first Bank Aid concert.
Clearly, we need more subsidies in order to drive prices even lower. [chuckle]
Wrong without the dollars of these city slickers the production channel will be controlled by way too few industrial consumers who in the end would decimate what is left of the small farmers. Soon after your plan went into effect mega corps would move in and farm mega sized farms would be rule and rural people would be in the same boat as 19th century coal miners.
Absolutely!! You wouldn't want the consumers to have any say in the price of crops.
Whatever the case, farmers in my neck of the woods are selling prime ag land to developers. Unfair trade practices undercut U.S. farmers. That's an issue.
I was raised on a farm, so I know how much hard work it takes. But I'd like to see all crop subsidies, not just cut, but ended. If that means some farms sink, tough rocks.
Where do I sign up to get paid $12 so I don't have to mow my lawn?
The vast majority of trader on the board ARE the big industrials!! They already control the prices!!
I don't think it likely that unfair trade practices result in developers buying land. There's more to it . . . .
Yes!! Why should the big corporations have a say in the price of the goods they buy? I think the government should tell them what to pay.
And those brokers on the Board of Trade floor are just a bunch of leeches. The government should take all their money and give it to the farmers.
I agree with that statement 100%.....
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