House lawmakers push against crop insurance subsidies

By Derrick Cain

© Copyright Agri-Pulse Communications, Inc.



WASHINGTON, Sept. 12, 2013 - Two House lawmakers continued today to press against subsidies for premium crop insurance for large agribusiness companies at a U.S. Public Interest Research Group (PIRG) press event, even as farm and industry groups continue to counter their arguments.

Rep. Ron Kind, D-Wis., and Rep. Tom Petri, R-Wis., joined PIRG in presenting another chunk of the 278,000 public petitions and 1,000 letters from small farmers calling on Congress to end subsidies to large agribusinesses.

The lawmakers said the subsidies send more than $1 billion dollars annually to crops that end up in junk food ingredients like high-fructose corn syrup.

“Farmers and taxpayers across the entire political spectrum know that our agriculture subsidy programs need to be overhauled,” Kind said. “As the representative of one of the largest agricultural districts in the country, I'm committed to working in a bipartisan fashion to bring real reform to American farm policy so that taxpayers and family farmers are put ahead of big agribusiness.”

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 Kind said the fight over the issue will get “duked out” during an eventual farm bill conference.  

 But industry leaders continue to counter what appeared to be a well-designed campaign of negative news on crop insurance this week, starting with a series launched by Bloomberg News and continuing with a series of press conferences like this one.

 

“Over the last decade, elected officials, financial institutions, farm leaders and farmers have reached a general consensus that crop insurance is the best risk management tool available," noted Tom Zacharias, president, National Crop Insurance Services, in response to the Bloomberg News series on crop insurance. "That conclusion was reached because crop insurance reduces the risk exposure to taxpayers while requiring farmers to purchase policies with their own money before enjoying the relative protection of insurance. In short, it forces farmers to manage risk before, not after it happens, which saves taxpayers money.
 
“The factual errors, blatant omissions and obvious bias in this series were stunning and it is unfortunate that the editors of Bloomberg News agreed to release these stories publicly. It was a great disservice to their readers and a personal insult to the hardworking farmers and ranchers of this nation.”

 

 Senate Agriculture Committee Chairwoman Debbie Stabenow also noted yesterday that, once a farm bill goes to conference, that crop insurance will be a key counterpart of the final bill.

 

 "We all agree we need a strong crop insurance safety net," she told Agri-Pulse regarding how the four principals view crop insurance.

 

  Groups speaking at this event included the National Taxpayers Union, Taxpayers for Common Sense, the Environmental Working Group, and the R Street Institute.

 

“Thousands of Americans, lawmakers from both parties, and groups from across the political spectrum all agree that it's time to end wasteful handouts to ‘Big Ag' in the farm Bill,” said Dan Smith, U.S. PIRG tax and budget advocate. “Almost anything would be a better use of our tax dollars than sending checks to giant, profitable agribusinesses.”

 

Petri said the government subsidizes about 62 percent of farmers' crop insurance premiums at a cost of about $9 billion a year, while U.S. small farmers receive 27 percent of the subsidies.

 

“That doesn't seem right to me,” Petri said. “We need to put in place reforms that keep a safety net in place for farmers who truly need assistance, but also ensures the program is not exploited-which ends up costing taxpayers a lot of money.”

 

The lawmakers said since 1995, $292 billion has been spent on agricultural subsidies, with three-quarters of the subsidies going to four percent of farmers. They introduced legislation in May to place a $40,000 cap on the subsidy for farmers with an income of more than $250,000.

 

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