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Farm Bill Extension: Support Stewards, Not Insurance Subsidies

Monday, November 12, 2012

With only five legislative weeks left, Congress must vote to extend the farm bill, but it must do it in a way that reflects the nation’s spending priorities, supports family farmers and protects the environment.

Most of all, lawmakers should ensure that critical conservation programs that expired with the old farm bill at the end of September have full funding, including programs that protect and restore wetlands and grasslands.

Since 2008, crop insurance subsidies and ethanol mandates have led farmers to plow up more than 23 million acres of wetlands and grasslands – an area the size of Indiana. That has to stop. Land protection programs such as the Wetlands Reserve Program must not sit idle. This year’s devastating drought is a compelling reminder of why the Conservation Stewardship Program and similar efforts cannot be allowed to lapse. A farm bill extension should ensure that farmers can continue to enroll in this program.

Congress must also maintain its investments in the most dynamic and entrepreneurial parts of the farm sector by fully funding critical research, marketing and economic development programs that also expired in September.

In particular, Congress should pass a farm bill extension that fully funds support for:

  • Organic Farmers – These programs include Organic Research and Extension, Organic Certification cost sharing and the Organic Data Initiative, which provide critical research and marketing support to help organic growers farm more productively and meet the growing demand for organic food.
  • New Farmers – The Beginning Farmer and Rancher Program funds education, training and outreach to support the next generation of farmers and ranchers; also crucial are programs that assist small and socially disadvantaged agricultural producers and cooperatives.
  • Farmers’ Markets – The Farmers’ Market Promotion Program helps farmers and ranchers increase their incomes by helping them sell their products directly to consumers through farmers’ markets, roadside stands, Community Supported Agriculture initiatives and other direct to market channels.
  • Value-Added – The Value Added Producer Grant Program supports local and regional food processing and activities that boost farmer incomes and economic development in rural communities.
  • Rural Entrepreneurs – The Rural Micro-entrepreneur Assistance Program provides loans, training and technical assistance grants to organizations that help rural small business owners grow their businesses.
  • Specialty Crop Research – The Specialty Crop Research Program provides grants that address a wide array of needs among growers of fruits, nuts and vegetables

Most of these programs were fully funded in both the House and Senate versions of the farm bill that has stalled in Congress.

What Congress should NOT do is to pass a farm bill extension that doubles down on direct payment subsidies, which have been paid primarily to the largest and most successful farm businesses regardless of need. Neither the pending House or Senate farm bills include direct payments – nor should an extension.

Congress should also resist calls to increase crop insurance subsidies. Legislators should ensure that the same means tests and payment limits that apply to traditional farm subsidies be applied to crop insurance as well so that family farmers compete on a level playing field. Reasonable limits on who should be eligible for crop insurance subsidies and the amounts they can receive would more than offset the cost of extending important conservation, rural development, research and marketing programs, while also contributing to reducing the federal deficit.

Finally, if Congress is serious about shrinking the deficit, legislators should simply end the practice of paying crop insurance companies to sell their policies – and thereby immediately save the taxpayers more than $10 billion. Many of the companies that collect these subsidies are based in foreign tax havens such as Bermuda and Switzerland, according to EWG research.