Washington, Oct. 2, 2000--As farmers head to the fields to harvest corn, soybeans and other crops that they know will bring ruinously low prices at the local grain elevator, Congressional leaders are quietly arranging a pre-election infusion of farm subsidy aid, atop billions in emergency funds already added this year.
But though hundreds of thousands of farmers are in desperate need, this helping hand from Washington will be extended to only a few thousand of the nation's very largest farm operations. In some states, only a few dozen huge operators will get the funds, according to a new study. Nationally, a few hundred farm subsidy recipients--the biggest of the big--stand to receive hundreds of thousands of dollars in additional government aid at harvest time. Most of them have already received large farm subsidy payments this year.
The measure will not provide a penny in additional aid to over 99% of the farmers harvesting the very same crops and participating in the very same subsidy programs, based on an analysis of subsidy payments in 1999, when an identical measure was tucked into a larger farm aid measure.
The payment boost for largest farms was not included in versions of the Agriculture Department's spending bill that the House and Senate debated and approved earlier this year. But a conference committee of the House and Senate may add the provision to the final bill when it meets behind closed doors this week.
The measure would lift a cap designed to limit the amount of USDA payments that the very largest farms can collect under several arcane federal crop loan programs. The waiver would allow big corn, soybean, cotton and rice producers to collect double the amount of government money they could ordinarily receive. Individual farmers could receive up to $150,000 instead of $75,000, as well as receiving doubled subsidies through corporate farms and other business arrangements that they own.
"The only purpose of this measure is to give an election-year handout to some of the largest, wealthiest farmers in the country -- the ones who need it the least," said Clark Williams-Derry, senior analyst with the Environmental Working Group and principal author of its new study, Bumper Crop. "A few thousand farms will share a taxpayer gift of at least $50 million, while over a million other farms will get absolutely nothing," said Williams-Derry. "The Titanic provided a more equitable and effective safety net for those at the bottom of the economic ladder."
"This is a bail-out for some of the biggest farmers in the country, whether or not they need it," said Ferd Hoefner, Washington representative for the Sustainable Agriculture Coalition, which collaborated on the report. "In effect, taxpayers are giving mega-farms a down payment to buy out their struggling neighbors, who won't get a penny." The report is based on an analysis of 16 million computer records of farm payments in 1999.
EWG obtained the records from the Agriculture Department under the Freedom of Information Act. The records enabled EWG to identify recipients that benefited from an identical doubling of the loan subsidy payment limits in 1999.
According to the study:
- Fewer than 2,500 individuals and 900 farm businesses nationwide--less than one half of one percent of all subsidized farms--benefited from the doubling of the loan subsidy limit in 1999.
- These 3,400 total recipients collected an average of $148,000 in loan subsidies each in 1999.
- The average recipient, who is not eligible for the bonus package, collected only $7,200, 14 times less than the 3,400 top recipients and far below the existing $75,000 payment cap that Congress may double again this year.
- The top 2,500 individual recipients received an average of nearly $20,000 in extra subsidies in 1999 when Congress raised payment caps for large producers.
- The top 3,400 individuals and businesses, in terms of loan subsidy payments, received a combined total of more than $500 million in farm loan subsidies, on top of $400 million they collected in Freedom to Farm and other direct subsidies.
- The highest 1999 loan subsidy payments per recipient went to rice and cotton farm operations. The top five states ranked by loan subsidy payment per recipient, are Arizona ($37,842 per recipient), California ($17,216), Mississippi ($14,849), Georgia ($14,358), and Minnesota ($13,215).
- Five states accounted for nearly half of all recipients who got more than $75,000 when the loan subsidy payment limit was doubled in 1999: Minnesota (325 recipients), Illinois (262), Texas (202), South Dakota (192) and Iowa (173).
- Although Congress doubled the payment limit for loan subsidies to $150,000 in 1999, about three quarters of the individuals who benefited from the increased limit collected between $75,0000 and $100,000. Fewer than 700 recipients nationwide collected more than $100,000 as a result of Congress' largesse.