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Blowing the Lid Off Crop Insurance Subsidies

Friday, June 1, 2012

EWG released an eye-opening report yesterday on subsidized crop insurance’s out-of-control spending. Using newly acquired government data, EWG demonstrated that crop insurance subsidies overwhelmingly benefit large agricultural operations – to the tune of more than a million dollars apiece in 2011 for 26 growers. The Politico’s David Rogers wrote of the report:

Armed with new data and an old playbook, environmentalists are taking aim at the crop insurance industry, seeking to bolster the case for a cap on premium subsidies when the Senate farm bill hits the floor in June.

At issue are government-backed premium discounts designed to make the insurance more affordable to farmers. While not truly cash subsidies, the costs have soared in recent years and fit neatly into the environmental narrative that Washington is too quick to help large-scale farm production at the expense of investments in conservation and the land itself.

The San Francisco Chronicle’s Caroline Lochhead touched on the secretive nature of crop insurance subsidies in her reporting:

In 2000, Congress prohibited public disclosure of the names of farmers who receive subsidized crop insurance, a program that has quadrupled in size since 2002, to $9 billion last year. The Congressional Budget Office projected the program will cost $90 billion in the next decade.

The Minneapolis Star Tribune’s Jim Spencer quoted EWG President Ken Cook’s take on the opaque government payments:

"We're going to ask the Senate to make the names of crop insurance subsidy recipients public. There is a tremendous concentration of benefits."

The Sioux Falls Argus Leader has a comprehensive piece, including this head-scratching response from Scott VanderWal, president of the South Dakota Farm Bureau, about limiting taxpayer-funded subsidies to highly profitable mega-farms:

Means-testing for income, he said, “is getting dangerously close to the class warfare discussion that’s going on in this country – of redistributing wealth. That’s the road that leads to socialism. And we’re very opposed to going to that kind of government.”

But as the Argus Leader noted, “in South Dakota, three farming operations received premium subsidies of more than $1 million, 29 received at least $500,000, 130 more than $250,000 and 970 more than $100,000.” That’s hardly the free market at work. The state Farm Bureau, by the way, is perfectly fine with drug testing needy folks looking for government assistance.

Amanda Paterka at E&E News (subscription required), in reporting that other organizations, including the American Enterprise Institute and the American Farm Bureau Federation, oppose the expansion of federal crop insurance, quoted EWG’s Scott Faber:

"The fact that EWG, AEI and the Farm Bureau are all in agreement shows how ludicrous these subsidies have become."

Many other outlets covered the report, including: Bloomberg News, The Des Moines Register, Farm Futures, MinnPost, the St. Joseph Post, the San Antonio Express, Minnesota Public Radio, the St. Louis Post-Dispatch, and the Iowa Gazette.

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Table Scraps:

-          EWG President Ken Cook and Vice-President Alex Formuzis penned an op-ed in today’s Sacramento Bee titled, “California Has a Big Stake in a Healthy Farm Bill.”

-          Grist’s Tom Laskaway reports on a study that finds that “human-caused groundwater depletion is a greater contributor to sea-level rise than climate change.”

-          NPR says the “Antibiotic-Free Meat Business Is Booming, Thanks to Chipotle”

-          John Robbins asks in the Huffington Post, “Why Are Twinkies Cheaper Than Carrots?”

Tweet of the day:

?@food_democracy Help @GrowinCities #urbanag film win chat w/sundance, but we need votes: http://ow.ly/biJUx Grow the movement, Please Rt

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