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Budget Proposal Would Reform Broken Crop Insurance Program

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For Immediate Release: 
Tuesday, February 9, 2016

WASHINGTON – Proposed cuts to crop insurance and other expensive farm subsidy programs in the Obama administration’s 2017 budget would be good for taxpayers and the environment, EWG said in a statement today.  

The proposed budget would reduce the subsidies provided to farmers for harvest price revenue coverage – known as “Cadillac” coverage – by 10 percentage points. The budget also calls for reforming prevented planting crop insurance. The two proposals would save taxpayers an estimated $18 billion over 10 years.

“The administration’s proposed reforms are much needed fixes that will save taxpayers billions of dollars and protect and improve the health of our land and water,” said Scott Faber, EWG senior vice president for government affairs. “Reducing premium subsidies for the Cadillac crop insurance plan and adjusting payment rates for prevented planting are common-sense ideas that should earn bipartisan support in Congress.”

Last fall Congress attempted to make cuts to the heavily subsidized crop insurance program, but industry supporters blocked the legislation. Contrary to the claims of profitable crop insurance companies, EWG found that these cuts would neither devastate the industry nor hurt farmers.

“If Congress can’t make sensible reductions in subsidies to a bloated program like crop insurance, then what can be cut?” asked Faber. “Federal crop insurance is not the safety net it was intended to be, but rather a misguided government handout, and the President’s budget proposal acknowledges that changes need to be made.”