With Congress headed back into session, the biggest remaining item on their to-do list is how to deal with the Farm Bill before it expires at the end of the month. The Farm Bill determines our nation’s agricultural and food policy, including a raft of food-related programs such as food assistance and rural development programs. But it also authorizes a set of misguided agricultural subsidies that lavish billions of taxpayer dollars on large, already profitable agribusinesses.
These subsidies were created during the Great Depression and were aimed at providing a financial safety net for small rural farmers. However, in the decades since, the farming sector has drastically changed. Six million rural farms are now down to just over 2 million, with a marked shift from small family farms to giant corporate agribusinesses. These mega agribusinesses, like Cargill and Monsanto, no longer need taxpayer assistance — in fact, last year the agricultural sector saw record profits of $98 billion and this year, even in the face of a drought, Big Ag is expected to shatter last year’s records with profits of $122 billion.
And Big Ag has not been shy about leveraging its profits into increased political influence that maintains the status quo. In 2008, the last time the Farm Bill was up for reauthorization, big agribusinesses spent $178 million on lobbying and campaign contributions to protect their subsidies.
As a result, the Farm Bill disproportionately subsidizes the large mature agribusinesses who take advantage of taxpayer dollars. Of the $277 billion spent on agricultural subsidies since 1995, 75 percent of the total went to just 3.8 percent of U.S. farmers, skewed towards the largest farms — not small family farms.
Not only are these subsidies going to companies that don’t need them, but frequently these dollars subsidize the production of additives that put public health at risk. Our research has found that over $18 billion went to subsidize junk food ingredients like high-fructose corn syrup and soy-derived vegetable fats since 1995.
Massachusetts consumers’ share of the cost for junk food subsidies is about $22.6 million each year on average, compared with just under $800,000 in subsidies for apples. That’s enough to buy 61 million Twinkies, but only 1.6 million apples.
This waste of taxpayer dollars is outrageous given the gravity of the childhood obesity epidemic. Childhood obesity rates in the U.S. have more than tripled in the past 30 years, with a third of children nationwide now overweight or obese. Obesity and its related illnesses accounted for roughly $150 billion in health care costs in 2008, representing a doubling of such costs in the course of a decade.
Despite this, Big Ag is using the current drought as an excuse and emotional pull to drive through a Farm Bill that would lock in these unnecessary subsidies. However, these long-term, rain-or-shine taxpayer giveaways have nothing to do with helping small farmers hard-hit by drought and natural disasters. In fact, struggling farmers are already receiving help through existing disaster programs. In addition, crop insurance programs expect to pay out $11 billion in claims on insured crops.
Public health experts, small farmers and conservative taxpayer groups want a farm bill with real reform, not one that wastes taxpayer dollars and underwrites junk food ingredients. Under pressure, both the Senate and House have proposed removing one of the worst tax subsidy programs, the Direct Payment Program, a cut that would save $45 billion over 10 years.
Unbelievably, many in Congress want to plow those savings into a new, expensive tax subsidy program benefiting the same large, profitable agribusinesses. While the Senate has passed their flawed bill, bipartisan opposition has so far held up a vote in the House.
With only a few working days in September before lawmakers head home to campaign, Congress will need to grapple with the calendar in order to act before the current Farm Bill expires. If agreement on a full Farm Bill can’t be reached, some will call for a short-term extension that would postpone the issue until after the election.
Regardless of the path taken, however, it is crucial for Congress to reform the outdated system of agricultural tax subsidies and end these corporate handouts. Members on both sides of the aisle will campaign on cutting wasteful spending and deficit reduction — how they handle the Farm Bill vote will be an important test of their commitment to making sure taxpayer dollars aren’t wasted on giveaways to special interests.