Congress is set to debate the Farm Bill, which sets up and funds U.S. agricultural policy. The bill will get marked up in the Senate Agricultural Committee this week and will see floor action this summer. This time, Congress — especially Sen. Max Baucus — a senior Senate Agriculture Committee member, should implement real reforms and real cuts to the Farm Bill — a bloated welfare and corporate cronyism bill in need of serious change.
Food stamp misuse
The Farm Bill is passed every five years or so and is done under the guise of helping struggling small farmers, but this is largely fiction. In fact, 80 percent of the $1 trillion Farm Bill spending doesn’t even go toward farms at all — it 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 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 — items like Sobe, Gatorade and Red Bull — not the staples of meat, vegetables and slow carbs.
The remaining 20 percent of the Farm Bill includes a vast number of wasteful programs that amount to classic corporate cronyism, government interventionism into the free market and the picking of winners and losers. Rather than help the small farmer, these programs prop up special interests and well-connected, wealthy agri-businesses — 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 bloated 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 it stops far short of making 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, however, is that it replaces them with a massive new entitlement program that literally guarantees farmers’ revenues. Spending on this new program would far exceed the savings from cutting direct payments.
Ax direct payments
There is wide agreement in Washington that the direct payment program should be cut. President Obama, Senate Democrats, and House Budget Committee Chairman Paul Ryan all called for cutting it in their budget proposals that came out this spring. Given this consensus, Congress should put these calls into action and actually eliminate the direct payments program, once and for all, and then seek further cuts in the Farm Bill.
Baucus sits on the Senate Agriculture Committee and can shape the Farm Bill. Since he is retiring after this term, 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.