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Statement of U.S. PIRG Tax and Budget Advocate Dan Smith on the Farm Bill Conference Committee agreement to be voted on by the House this week:
“U.S. PIRG urges Congress to vote NO on the Farm Bill. At a time of supposed fiscal caution, this bill would put taxpayers on the hook for another five years of billion-dollar handouts to huge, profitable agribusinesses. Even the most modest reforms to trim subsidies for the largest players were stripped out or watered down at the last second by the chairs of the House and Senate Agricultural Committees.
“Just as in previous years, the new Farm Bill does very little to help small farmers. In recent years 74 percent of these subsidies went to just 4 percent of agribusinesses, with more than 60 percent of farms not even getting a dime. These subsidies are pure and simple a boon for special interests, at the expense of average taxpayers.
“On the floor of the Senate, 59 Senators from both parties voted for the bipartisan Durbin-Coburn amendment that would have trimmed crop insurance subsidies for agribusinesses making more than $750,000 in yearly profits by 15 percent. Yet the new bill weakens even that modest improvement. Congress should vote no on this bill and get serious about ending these wasteful subsidies.”
Five Ways the Farm Bill Brings Home the Bacon for Big Ag
“Direct Payments” bait and switch
The Farm Bill eliminates the “Direct Payments” program – long the poster child for wasteful agricultural subsidies, known for handing out checks to rich landowners who don’t even farm. But in a political sleight of hand, the bill plows more than half the savings from cutting Direct Payments into a new subsidy program that will continue to give handouts to large agribusinesses that don’t need our tax dollars.
The new “shallow loss” programs would lock in the record high prices of recent years. A study commissioned by the Environmental Working Group found that if prices fell, the new program could cost taxpayers $20 billion more over the next decade than the discredited “Direct Payments” program.
Big profits mean big subsidies
Since 1995, just 4 percent of agribusinesses have made off with three quarters of the subsidies. Yet the bill does next to nothing to reduce or eliminate subsidies for agribusinesses with high incomes. For millionaire farmers, the checks will keep on coming.
No caps mean million dollar checks
The bill fails to put any cap on how big a check an agribusiness can receive to help pay its insurance bill. Currently, taxpayers pay over 60 percent of the premiums for insurance that compensates agribusinesses for poor yields, price declines, or both. On top of that, taxpayers pay 15 private insurance companies $1.3 billion to run the program.
Because the program has no caps, 26 agribusinesses have received more than $1 million in a single year, while 80 percent get $5,000 on average, according to a study from the Environmental Working Group.
Instead of reining in this program and capping how much agribusinesses can receive, the bill would actually expand it.
Paying to market Big Macs and underwear abroad
The Farm Bill makes no changes to the $200 million per year Market Access Program, which has subsidized ad campaigns for giant agricultural companies and their trade associations. Companies receiving funding have ranged from McDonald’s to Fruit of the Loom. Taxpayer money has even been used to pay for a reality TV show in India to promote cotton. Companies are perfectly capable of buying their own airtime - they don’t need taxpayer dollars to subsidize their ads.
Subsidizing junk food
At a time when America faces an obesity epidemic, billions in subsidies underwrite the production of junk food additives. Between 1995 and 2012, CoPIRG research found that $19.2 billion subsidized four common junk food additives, including high fructose corn syrup. That’s enough to buy every kid under 18 eight 2-liter bottles of soda every year. By contrast, the subsidies for apples – the only fruit or vegetable that gets significant subsidies – would pay for less than half of an apple for each taxpayer.
The Farm Bill fails to make meaningful reforms to correct this imbalance in our food policy.
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