Blog

We need a smarter farm bill

By Steve Blackledge
Public Health Program Director

We urged a “no” vote on the 2014 Farm Bill because it failed to corral wasteful subsidies. And now it appears our budget concerns were warranted. 

In the bill, Congress eliminated a subsidy called direct payments -- a handout everyone from Glenn Beck to President Obama called wasteful. But with a sleight of hand that would make a Vegas dealer proud, lawmakers moved money to another subsidy, discounted crop insurance. 

Fast forward from 2014 to late January of this year. The Congressional Budget Office (CBO) came out with a new analysis -- summarized here by Environmental Working Group -- saying that the costs to taxpayers of crop insurance will be 15% higher than originally forecasted. Put another way, fiscal hawks like Taxpayers for Common Sense and National Taxpayers Union called it a bad deal then, and now the price has gone up. 

It should be noted somewhere in this blog that the theory behind farm subsidies isn’t unreasonable. It goes something like this: farmers supply our country with the food we need, and because of this vital role, we protect them against the financial ravages of a bad year, caused by drought, flooding, etc.

But the theories behind the subsidies and the actual practices have diverged. Many of the farmers and large agribusinesses that receive farm subsidies in general, and crop insurance in particular, are not one bad yield away from bankruptcy. With this in mind, Sen. Tom Coburn (R-OK) tried to steer government subsidies away from those who didn’t need it, but his efforts were defeated. (See in particular the last three paragraphs of this story.)

In addition to concerns that the program is wasteful, the Farm Bill produces unwanted by-products. We subsidize corn to such an extent that American farmers grow more than is needed, leading to of all things high-fructose corn syrup. In short, we’re subsidizing our country’s obesity

So, what to do with the new CBO data? The President’s fiscal 2017 budget proposes a cut in crop insurance subsidies, which is an excellent start. Further out on the horizon, Congress should focus on designing a smarter, better Farm Bill that doesn’t waste taxpayer funds and produce unwanted outcomes. The time is now to start working on that.

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