Restoring integrity and fiscal responsibility in farm policy

“The farm program was never intended to help big farmers get bigger, instead it was created to help those who couldn’t withstand the political whims of Washington or the fierce reckonings of Mother Nature.” — Senator Grassley, August 2010.

NEW:  Fact Sheet on Commodity Payment Subsidy Reform in House and Senate Farm Bill

While farm programs have been capped by law for four decades, they actually operate as unlimited government subsidies that drive family farms out of business and keep new farmer entry low.  Because of program eligibility loopholes, an individual does not actually have to be actively farming to receive a government check.  These loopholes and unlimited subsidies have helped fuel an exodus from farming and rural America by favoring mega-farms over family farms, driving the consolidation of farmland, and inflating land prices.  In a time of record budget deficits, scarce federal dollars should not be flowing without limit to the wealthiest mega-farm owners, and should instead be targeted to those most in need of assistance and capped at a reasonable level.

The Farm Program Integrity Act (S.281, H.R.1932) is a comprehensive bill intended for inclusion in the 2013 Farm Bill that would lower the per farm cap on farm commodity program payments and ensure that federal farm payments flow to working farmers by closing existing loopholes that allow mega farms to collect subsidies that are many multiple times larger than the legal payment limitation.

Bill Basics

Commodity payment limit reform is a cost-saving policy that restores common-sense rules to farm programs by:

• Creating a hard cap on commodity payments so that no farm can receive more than $250,000 per year – rather than the current unlimited amount – in farm subsidies, including not more than $100,000 per farm in payments not associated with marketing loans.
• Targeting payments to working farmers and closing existing loopholes that allow mega-farms to collect far higher payments than current law would otherwise seem to allow.

Why It Matters

• Ensuring fiscal responsibility in farm policy during this time of financial crisis requires creating a firm cap on commodity payments.
• Closing current loopholes is the key to targeting payments to active farmers instead of absentee landowners and investment bankers, and to ending unlimited subsidies that pay for mega-farm consolidation.
• Rebuilding a vibrant rural economy and farming population requires restoring common-sense rules for farm payments and reinvesting a portion of the savings into higher priorities for rural America.

NSAC and NSAC member groups have worked very closely with the bill’s champions on the development and advocacy of this bill over many years.  The Senate adopted this language in the final farm bill that was passed by the full Senate last year, but the House Agriculture Committee did not include these common-sense reforms in their draft farm bill.  NSAC continues to urge its adoption, and will be advocating for its inclusion in the 2013 Farm Bill currently under consideration.

Read more about the bill on our blog or press page, or download the full legislative text of the bill.  Check out NSAC’s Grassroots Guide to learn more about commodity payment reform.