18 Jun 2012

Farm, Rural and Environmental Groups call for Crop Insurance Subsidy Limits

By John Crabtree

Lyons, Nebraska - This week, the Center for Rural Affairs joined four other farm, rural and environmental organizations in signing and sending a letter to every U.S. Senator urging them to place limits on the federal crop insurance premium subsidies granted to individual farmers, establish income limits for subsidy recipients and require that recipients be actively engaged in farming.

"We are a diverse group of organizations united by the belief that responsible farm policy should direct subsidies for crop insurance premiums to farmers who need it," said Chuck Hassebrook of the Center for Rural Affairs. "And Congress should cap those premium subsidies at levels that do not make it easier for the nation's largest farms to drive out small, mid-sized and beginning farmers."

To view or download a full copy of the letter go to: http://files.cfra.org/pdf/crop-insurance-letter.pdf

According to Hassebrook, federal farm spending is dramatically shifting from farm payments to subsidies for crop insurance, with the federal government now paying an average of 60% of premiums. Crop insurance expenditures are more than double traditional farm programs under the proposed new farm bill, with no subsidy limit and no eligibility requirements.

"The result will be an increase in the already excessive subsidies to the nation's largest farms," Hassebrook explained.

"In a time when federal dollars are scarce we are sending precious government resources to large and highly profitable agribusinesses while cutting food assistance to needy children and environmental protections for soil, water, and wildlife," said Craig Cox, senior vice president of agriculture and natural resources at Environmental Working Group. "It is simply irresponsible to send unlimited subsidies to farm businesses that can easily afford to pay more of the cost for their crop insurance - 26 mega farms received over a million dollars apiece per year in crop insurance subsidies in 2011."

The joint letter also explains that capping individual premium subsidies and setting income limits will not deny farmers access to needed risk protection.  And it is important to note that such a policy would not deny or cap insurance payments (indemnities) to farms facing losses.  Rather, it would limit subsidies on the front end for payment of premiums. These subsidies are highest in the best of times because it costs more to insure a crop at market value when its price is high.

"Federal crop insurance is a valuable tool for producers - one which we support.  Farmers need to be able to manage risks of failed crops and low prices to maintain their farms from year to year," said Chuck Hassebrook of the Center for Rural Affairs. "But the emergence of crop insurance as the primary element of farm policy requires that it be subject to payment limitations and eligibility requirements, just like traditional farm programs."

10 Jan 2012

A Rural Resolution for 2012

By John Crabtree

By John Crabtree, johnc@cfra.org, Center for Rural Affairs

The dawning of a new year is a time when most of us resolve to improve our lives in some way. This year, I resolve to dedicate myself to ensuring  rural America has a voice at the table as Americans grapple with the stern challenges that face our nation. There will never be a better time for rural Americans to raise up their voices as Congress debates a new farm bill and as the nation nominates Presidential candidates, chooses a President and elects a new Congress.

It is crucial that rural Americans ask tough questions of all our elected leaders. Will the farm bill finally include reforms that work for family farmers, ranchers and rural communities? Will such reforms ever be implemented, or will they be undermined when there is no longer an election on the horizon? Will efforts to stimulate the American economy include investments in proven strategies to revitalize rural communities? Will the farm bill include much needed investments in conservation, rural development and the next generation of family farmers and ranchers?

Rural voters will be vitally important in 2012. But we cannot expect candidates and elected leaders to fulfill their promises unless we are willing to take responsibility for ensuring they do. The role rural America plays in elections and policy debates this year will not be long remembered unless those of us who live here remind those candidates and elected officials, as many times as possible, that rural communities matter.
17 Oct 2011

Farm Bill Deficit Deal Must Include Real Reform

By John Crabtree
Lyons, Nebraska - For the Center for Rural Affairs, the most troubling concern about a  proposal rumored to be forthcoming in a letter from House and Senate Agriculture Committee leaders to the twelve member deficit reduction "Super Committee" is whether it would follow the trend of recent farm bill proposals and continue to allow the single most wasteful and counterproductive feature of current farm policy - virtually unlimited federal crop and revenue insurance subsidies.


*Following is a list of questions and background on the subjects mentioned above...

Will the nation's largest farms and wealthiest landowners get a pass on contributing to deficit reduction?

Will the Agriculture Committees' recommendations to the Super Committee continue the single most wasteful and counterproductive feature of current farm policy - unlimited payments to subsidize the nation's largest farms to drive small operations out of business?  

Any serious reform of federal farm programs must cap federal crop and revenue insurance subsidies to mega farms.  They are the most expensive element of farm programs, costing $7 billion annually. And if one big corporation farmed all of America, USDA would pay 60 percent of its insurance premiums on every acre for protection from low prices and crop failure.

Why should the federal government pay 60% of crop insurance premiums on every acre of the largest farms and richest landowners in America, especially in the midst of record high farm income and record federal deficits?

Any serious reform must also close loopholes in the cap on other farm payments. Senators Chuck Grassley (R-IA) and Tim Johnson (D-SD) have again introduced legislation to close those loopholes, but it is not incorporated in either the President's proposal or any of the budget proposals introduced in Congress. That means that whatever revised safety net is established will include no cap on benefits for anyone who takes the steps to form a general partnership with investor partners.

Finally, will the Agriculture Committees' budget proposal include any room for funding for rural development and beginning farmer programs that invest in creating a future in rural America?   We probably know the answer.  But consider this.  The two last farm bills have invested an average of about $45 million annually in rural development programs from mandatory funds.  Overall federal rural development funding has fallen by more than one quarter since 2003. (See below.)

Why should continuing recent levels of farm bill funding for rural development be a lesser priority than paying the crop insurance premiums for the biggest farms and richest landowners in America, without limit, at a time of record deficits and record farm income?

Subsidies should be capped to powerful mega-farm interests and the savings reinvested in rural development programs that support small business and beginning farmers, create jobs for ordinary rural Americans and build a more vibrant future for small town America.

Rural Community Development Budget Authority Final Appropriation FY 03-11 and President's Proposed FY 12 Budget (excluding ARRA and mandatory funds for water and sewer backlog )

 

 

FY03

 

FY04

FY05

FY06

FY07

FY08

FY9

FY10

FY11

FY12

Water/Sewer

723.2

 

605

552.1

530.1

554

539

566.8

568

529

489

Buss-ness

127.7

 

91.5

89.6

109.5

71.3

105.9

123.9

121.4

108.3

125

Comm Facility

96.8

 

75.9

89.1

82.6

77

69

50.1

55

41.62

38

Total

947.7

 

772.4

730.8

722.2

702.3

713.9

740.8

744.4

679.1

675
02 May 2011

USDA Invests in Iowa Organic Farmers

By John Crabtree

Iowa farmers transitioning to organic systems as well as established organic producers now have an opportunity to apply for Environmental Quality Incentives Program (EQIP) Organic Initiative funding to assist their organic efforts.

The USDA recently announced another $50 million in funding for the EQIP Organic Initiative, which provides a 75% share of the cost of implementing organic conservation measures to those who qualify - 90% for beginning, limited-resource and socially-disadvantaged farmers and ranchers.

This is the third year of the Organic Initiative. In 2010, NRCS obligated $24 million nationally with over $1.4 million going to Iowa organic farmers. This year even greater funding is available for Iowa producers to plan and implement conservation practices that address natural resource concerns in ways that are consistent with organic production. The deadline for this application period is May 20, 2011.

The Center for Rural Affairs has a long history of assisting family farmers and ranchers in accessing new conservation programs.  We created an EQIP Organic Initiative fact sheet available at - http://www.cfra.org/node/2509 - and we operate a Farm Bill Helpline where producers can call (402) 687-2100, ask for the Farm Bill Helpline and speak to a real person who can help producers receive assistance in accessing new programs like the EQIP organic initiative.

The Farm Bill Helpline can also assist farmers and ranchers with the Conservation Stewardship Program, the Cooperative Conservation Partnerships Initiative, the Value Added Agricultural Market Development Program and a host of Beginning Farmer and Rancher programs.

By John Crabtree, johnc@cfra.org, Center for Rural Affairs

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