Congress is set to debate the Farm Bill, which defines and funds U.S. agricultural policy. The bill will get marked up in the Senate Agricultural Committee and will see floor action this summer. This time, Congress – especially Sen. Max Baucus – a senior Senate Agriculture Committee member, should implement real reforms to the Farm Bill – a bloated welfare and corporate cronyism bill in need of serious change.
The Farm Bill is passed every five years or so and is done under the guise of helping struggling small farmers. This is largely fiction. In fact, 80 percent of the $1 trillion Farm Bill spending goes toward food stamps. This welfare program meant to help the needy purchase nutritious food is out of control. More than 47 million Americans are now on food stamps – that’s one in every seven Americans – a 70 percent increase during President Barack Obama’s first term. It is also ripe with abuse. Former Montana State Rep. Tom Burnett has analyzed the misuse of food stamp funds. Burnett claims that $16 billion of the $80 billion spent annually on the food stamp program is used by recipients to buy sweetened beverages alone, not the staples of meat, vegetables and slow carbs.
The remaining 20 percent of the Farm Bill includes funding of wasteful programs that amount to classic corporate cronyism and government interventionism into the free market. Rather than help the small farmer, these programs prop up special interests and well-connected, wealthy agri-businesses with benefits like unlimited crop insurance subsidies, direct payments, price supports, import quotas, grants and loan guarantees, and so on. According to the Environmental Working Group, since 1995 more than 70 percent of all farm subsidy payments have gone to the richest 10 percent of farm businesses.
Both versions of the Farm Bill that we saw in Congress last year authorized about $250 billion in higher spending than the 2008 Farm Bill. Both cemented the welfare policies of the past, and created new ones. This year’s bill is likely to be no different – it will authorize nearly a trillion dollars in spending over the next decade, and doesn’t make serious cuts to the billions we waste on farm subsidies and food stamps.
To feign spending cuts, Farm Bill proponents point to proposals to cut direct payments. Under this antiquated program, the government sends about $5 billion in automatic checks to farm landowners and operators, regardless of their economic need or whether they even grow crops.
What they fail to mention is that it replaces them with a massive new entitlement program that literally guarantees farmers’ revenues. Spending on this new program would exceed the savings from cutting direct payments.
There is consensus in Washington that the direct payment program should be cut – Obama, Senate Democrats and House Budget Committee Chairman Paul Ryan all called for cutting it in their recent budget proposals. Given this, Congress should permanently eliminate the direct payments program and then seek further cuts in the Farm Bill.
Baucus can shape the Farm Bill. Since he is retiring, Baucus has one last opportunity to reform federal agricultural policy. If Baucus and his colleagues can’t reform the wasteful welfare and big corporate agri-business programs that clutter the Farm Bill, there’s little hope they’ll cut spending elsewhere.
Henry Kriegel is the deputy director for Americans for Prosperity-Montana.