Freedom to Farm

An analysis of payments to large agribusiness operations, big city residents, and the USDA bureaucracy

February 1, 1996

Freedom to Farm: Foreword by Kenneth A. Cook

Suppose you're an editor or a reporter who suddenly falls victim to corporate downsizing at the newspaper, magazine, television network or radio station where you work. You'd probably appreciate a new Federal program that will keep you whole with guaranteed payments of tens of thousands of dollars per year, every year, for the next seven years. You might get as much as one million dollars from the government, in total. And you'll get your Federal checks on top of whatever severance payments you get from your employer. In fact, you'll get government payments for 7 years even if you're fortunate to find a new job right away that pays more than the job you lost.

Or let's say you're a manufacturing worker who loses your job because of a factory closing or workplace automation. How about a Federal program under which Uncle Sam will pay you $20,000, $30,000, $40,000 or more every year from now through the year 2002, with no requirement that you get another job? Better yet, under this program even if you do get a job you'll still get the government payments--and your spouse may well get the same amount or more.

Or perhaps you'd just like to retire to a sunny resort spot right now -- even if you're only thirty-something. This Federal program will support you while you do absolutely nothing--a guaranteed Federal annuity of as much as $300,000, $400,000, or more, payable over the next 7 years.

It may sound like "Publisher's Bonanza," but in fact it's public policy -- from the new Congress. And sorry, taxpayer: only past farm subsidy recipients are eligible. The rest of us lose -- big.

It's a Federal farm subsidy "reform" proposal called "Freedom to Farm." Ed McMahon and Dick Clark won't be picking the big prize winners. Congress will.

If "Freedom to Farm" becomes law, Congress will be sending out checks for $35.6 billion, written against your account, taxpayer, to a handful of Americans who will qualify for "Freedom To Farm" payments over the next 7 years.

Under the preposterous rules of this new subsidy game, the only way to win is if you've won before. That's right: only past farm subsidy recipients are eligible for "Freedom to Farm" payments. And the bigger the payments they've received in the past, the bigger the checks they'll get through 2002 under "Freedom to Farm." Some recipients stand to get more than $1 million over 7 years. They won't have to plant a seed to earn it. But if they or the tenants they leave back on the farm do raise a crop, they'll receive government subsidy checks in addition to huge profits from the marketplace, where prices are higher than they've been in years. "Freedom to Farm" subsidies will be made entirely without reference to economic need or market conditions.

For the average taxpayer, the proposition goes something like this: you're taking a pay cut so that anyone who has received a farm subsidy payment over the past 5 years will automatically receive a continuous stream of welfare payments over the next 84 months, even if they get a job that pays as much as yours pays, or even if they don't work at all.

In this report we focus on some of the biggest and most outrageous winners of "Freedom to Farm." These recipients will be familiar to readers of previous EWG studies of agriwelfare, City Slickers, Fox in the Henhouse, and The Cash Croppers. They're the "farmers" who live in the middle of America's biggest cities. They're the federally-paid employees and farmer-committee members of the USDA bureaucracy who will get "Freedom to Farm" payments through the very programs they administer. And they are the super-big winners: the top two percent of Federal farm subsidy recipients--roughly 28,000 large agribusiness operations, corporations, joint ventures and assorted "paper farms" that will haul in more than 22 percent of "Freedom to Farm" payments -- $7.8 billion in all, averaging more than $40,000 apiece per year.

We also debunk some of the misconceptions about the "reforms" represented by "Freedom to Farm." "Freedom to Farm" does not cut farm subsidies, it increases their cost by billions and stretches payment guarantees from 5 to 7 years. "Freedom to Farm" does not end farm subsidy programs, or even phase them out: at least $4 billion will be available per year for farm subsidies after the program expires in 2002. "Freedom to Farm" also does not allow farmers to plant freely for the market instead of for the government. And "Freedom to Farm" does not end any of the well-known abuses and inequities of current programs, which are a goldmine for corporate subsidy loophole artists. In fact, it makes past rules worse by divorcing payments entirely from market conditions, actual farming activity, or economic need.

A sensible reform bill would retain a safety net for bona fide, working family farmers. It would shift billions of taxpayer dollars out of "Freedom to Farm" payments and reinvest those funds in the real needs of rural America. Affordable housing. Help for small businesses. Clean streams and safe tap water. Reduced use of pesticides. Protection of threatened and endangered species.

Then again, if you're the type of taxpayer who likes your government big, dumb, and free-spending, "Freedom to Farm" is the subsidy reform for you.

Kenneth A. Cook
Environmental Working Group