Much has been made of the fact that two-thirds of the $27 billion in fiscal 2001 farm program and disaster payments went to only 10 percent of those classified by USDA as farmers.
In the weeks leading up to the House vote on the new farm bill, environmental groups distributed lists of the “Top 100” recipients of farm payments to major daily newspapers. The lists, obviously designed to attract maximum exposure, included the names of congressmen, NBA basketball stars and some federal agencies.
The articles produced predictable reactions. Sen. Tom Harkin, chairman of the Senate Agriculture Committee, called them “an embarrassment, a black eye that can only undermine public and taxpayer support for the programs.”
Farm organizations attempted to respond with varying degrees of success, realizing their comments would be ignored by the big city dailies that carried the articles.
Perhaps the best rejoinder would have been a paraphrase of bank robber Willie Sutton's statement that he chose those institutions “because that's where the money is.” That is, farm payments go to the farms with the most acres and, thus, the highest production.
According to the 1997 Census of Agriculture, USDA considers 18 percent of the farms in the United States “large” because they have annual gross revenues exceeding $100,000. Those farms account for about 84 percent of the total U.S. production. (“Small” farms with less than $100,000 in revenues were 76 percent of the total but accounted for only 8 percent of U.S. production.)
If large farms account for 84 percent of the production but only received 66 percent of the payments, some would argue those farms are being short-changed by federal spending programs.
As most producers know, the figures are skewed by the payment limitations that apply to Agricultural Market Transition Act, loan deficiency and crop disaster payments. Larger farming operations have reorganized to qualify for more payments but frequently have to “leave money on the table.”
While the environmental groups apparently chose to release their Top 100 lists to gain support for the now-defeated Kind amendment, administration officials also have begun picking up on the theme of “farm payments helping the big get bigger.”
Writing in their Food and Agricultural Policy Report, USDA officials said: “Highly efficient commercial farms benefit enormously from price supports, enabling them to expand their operations and lower costs even more. Others have not received enough benefits to remain viable and have been absorbed along the way.”
The report does not mention the possibility that U.S. farms have grown larger because of the “Wal-Mart principle” — they have been forced to get bigger to compete with low-wage, lower-cost farming operations around the world.
With the Senate Agriculture Committee beginning work on its farm bill, the big-small farmer rhetoric will become more heated in coming weeks. Those engaging in the debate need to ask this question: Do we really want the United States to have to buy its soybeans from Brazil, its cotton from China, its corn from South Africa, its wheat from Canada and Australia?
Shifting payments from commercial farms to those who barely produce enough crops to qualify to be called farmers is one of the fastest ways we know to make that happen.
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