UPDATE: An earlier version of this release erroneously attributed Sen. Stabenow’s summary of the GAO report to the report itself.
MINNEAPOLIS – Since 2018, in response to retaliatory tariffs from President Trump’s long-term trade war with China, the Department of Agriculture has paid many billions of dollars to farmers supposedly suffering financial losses. The payments are made through the Market Facilitation Program, or MFP.
Today, the Government Accountability Office released a damning report summarizing its investigation into the program. In the words of Sen. Debbie Stabenow (D-Mich.), who requested GAO’s investigation, “[t]he data in the GAO report confirms previous findings that the Trump Administration picked winners and losers between regions, crops, and farms in their attempt to assist farmers harmed by President Trump’s turbulent trade agenda.”
Under federal law, to qualify for MFP payments, farmers have to provide either “active personal labor,” with people actually working on the farm, “active personal management,” with people spending time managing the farm, or a combination. The GAO found that last year, of the top 25 farms that received the largest payments in 2019 – a total of $37 million in taxpayer dollars – eight qualified for government checks through “active personal management.”
This means that none of these recipients did any actual farm labor, yet they received $11.6 million in government payments.
“The USDA’s definition of ‘active personal management’ is incredibly vague,” said Anne Weir Schechinger, EWG’s senior economics analyst. “People with minimal ties to farms can – and do – receive huge payments from the federal coffers just by dialing into a few shareholder conference calls a year, without ever having to set foot on the farm or get their hands dirty.
“The GAO’s new report shows just how the MFP program has exacerbated the existing divide between the haves – people who know how to exploit the federal subsidy system – and the have-nots – small farmers who are actually harmed by shifts in the agricultural economy, including Trump’s capricious and unnecessary trade war,” Schechinger added. “The USDA must do more to ensure that these federal dollars flow to struggling small farms, and not large, wealthy farms that milk the system for a taxpayer-paid windfall.”
The GAO report reinforces EWG findings showing how giant loopholes in farm subsidy programs have allowed taxpayer dollars to flow to “city slickers” living in major American cities.
The Farm Service Agency recently proposed new rules that aim to tighten the “active personal management” loophole of farm-bill-authorized subsidy programs.
The rules would require people who qualify for subsidies through “active personal management” to perform at least one-fourth of the farm’s total management hours, or at least 500 hours each year, which would limit traditional farm subsidies to people who actually do significant work for the farm. But these new rules do not apply to the MFP. To be fair to taxpayers, USDA must apply these rules to any future farm subsidy programs, such as future iterations of MFP.
The Environmental Working Group is a nonprofit, non-partisan organization that empowers people to live healthier lives in a healthier environment. Through research, advocacy and unique education tools, EWG drives consumer choice and civic action.