In the six months since they ended their Freedom to Farm program, the U.S. Department of Agriculture has paid twice as much in subsidies to American farmers than it did during the same period last year, according to the Environmental Working Group (EWG). In September, Congress passed the Freedom to Farm Act, which ended decades of subsidized farm payments that reduced crop prices and encouraged overproduction by directing government payments to farmers with large land properties.
New data from Environmental Working Group
Government payments to U.S. farmers doubled during a 12-year period in which taxpayers shelled out more than $20 billion each year to support farm production, according to EWG’s analysis of recently released data from Washington. Since 1999, total taxpayer subsidies have topped $277 billion; $22 billion was paid in 2012 alone. Taxpayers now pay three times as much each year to subsidize farms—including half of all farmland—as they do for foreign aid. The bulk of these subsidies go to large commercial operations that don’t need them and often use them to expand their operations or switch from one crop to another. The biggest subsidy is a direct payment program that pays farmers whether or not they grow crops on their land.
What subsidies do we mean?
Common farm subsidies have included direct payments and countercyclical payments, disaster relief, and price supports. These subsidies were set up to act as a cushion for farmers during low points in their business cycle—namely, when markets or crop prices dip too low. But not only do these subsidies prop up prices for all agricultural goods, they also discourage farmers from developing new methods of sustainable agriculture that could protect crops from even short-term dips required. The United States spends about $14 billion annually on farm subsidies, which is more than twice what it spent in 2000. The majority of U.S. farm subsidies go to commodity crops like corn and soybeans, while less than 1 percent goes toward fruits and vegetables (which is one reason why Americans are so much less healthy than people who eat fresh produce).
Some farmers are far from poor farmers
Many farmers who received government farm payments in 2011 make far more than double the income of a typical American family. More than half of those payments went to just 10 percent of farmers. According to new data released by EWG, over four thousand recipients received $250,000 or more in subsidies and another five thousand received $100,000 to $249,999. The average payment was almost a quarter million dollars – about seven times as much as what most Americans make in a year.
Taxpayers have been paying twice as much
U.S. farm subsidies have doubled in five years, even as farm income has surged to record levels, according to a new analysis by Environmental Working Group (EWG). The flood of subsidies—given to protect agribusinesses and their often-wealthy owners from market forces—has made taxpayers increasingly vulnerable to commodity price swings and declining incomes for struggling farmers, EWG’s report finds. In 2012 alone, taxpayers paid $20 billion to subsidize crop insurance premiums and operating expenses for farms, on top of $14 billion in federal crop insurance payments that year. That’s more than double what they spent on these programs in 2007. In addition, Congress is considering a $3 billion cut to food stamps that would kick 2 million people off the program next year.
Agribusiness giants have benefited most
EWG’s analysis found that between 1996 and 2015, about 90 percent of all U.S. farm subsidy payments went to operations with sales of more than $100,000 in 2009 – a sector representing just 0.8 percent of all farms but controlling two-thirds of farmland in the United States. In other words, EWG says, agribusinesses with many millions in annual sales received almost 70 percent of all crop subsidies and three-quarters of conservation subsidies over nearly two decades.
Where in America is this happening?
California’s Imperial Valley and Salinas Valley, which together received almost $500 million in farm subsidies between 1995 and 2012. During that time period, USDA farm subsidy payments to farms in these two valleys more than doubled. These figures do not include crop insurance subsidies, most of which go to large commodity farmers. Farmers are only eligible for crop insurance subsidies if they grow designated crops on a portion of their land (for example, cotton or corn).
The future of farm subsidies
The U.S. farm bill is up for renewal, and soon Congress will be debating how best to spend more than $500 billion in farm subsidies, agricultural support and food aid in the years to come. The new farm bill should start by completely eliminating direct payments to farmers, even those with a history of taking large amounts of government money. This program simply pays farmers whether they grow crops or not.