If congressional budget hawks have that deer-in-the-headlights look, it’s understandable.
Back in 2014 when the latest Farm Bill was signed into law, there was plenty of strutting about how the overhaul of the bill’s commodity title was going to save taxpayers billions of dollars in subsidy payments.
The enacted law repealed three farm safety net programs generally hated by GOP budget cutters: direct payments, counter-cyclical payments and the Average Crop Revenue Election (ACRE) program.
So when U.S. Department of Agriculture Chief Economist Robert Johansson told a House Agriculture subcommittee that in 2014 feds paid $10.6 billion in subsidy payments to farmers due to depressed prices for crops like corn and – to a lesser extent – soybeans, you can imagine what the hawks were thinking: “Hey that’s a lot of dough-ray-me.”
But Johansson was just getting warmed up.
Johansson testified that 2016 farm subsidy payments could reach $13.9 billion.
The reason, Johansson noted, was the slowdown in China’s economy, negative influences associated with currency rates, bans on some U.S. exports (notably poultry due to bird flu), and growing competition from other nations and lower commodity prices in general.
Given that net farm income for 2016 is projected at slightly less than $55 billion, it didn’t take budget downsizers very long to realize that U.S. farmers would derive about 25 percent of their income from taxpayer funded subsidies.
That’s the biggest payout and highest ratio since 2006.
Of course there was a lot of mumbling about the need to re-open the Farm Bill and fix commodity payouts.
Lost in those numbers is that farmers will earn less than half of what they did in 2012 when corn futures reached a record $8.49 bushel.
Not to say that Johansson tried to put rosy spin on the numbers:
“…despite slightly lower expected net farm income in 2016, we still project that a majority of farm households will see increases in household income in 2016…”
Huh? Turns out that calculation depends on off-the-farm income, often provided by a second job or spouse.
Maybe it’s lost on those who want to slash and burn the Farm Bill, but it’s doing exactly what it’s intended to do — keeping farmers planting crops even as they risk taking a loss for their effort.
I’ve got two words for it: food security.
Farming is a high risk business. And the bottom line is that while farmers certainly work for themselves and their families, they also keep us from becoming a very hungry nation.
It is our national interest to ensure farmers and ranchers continue to produce — especially in the lean times.
About Dave Dickey
Dickey spent nearly 30 years at University of Illinois at Urbana-Champaign’s NPR member station WILL-AM 580 where he won a dozen Associated Press awards for his reporting. For the past 13 years, he directed Illinois Public Media’s agriculture programming. His weekly column for Big Ag Watch covers agriculture and related issues including politics, government, environment and labor. Email him at email@example.com.
This column reflects the writer’s own opinions and not those of Big Ag Watch.