The Farm Bill

Thu, 02/01/2007

The roots of the Farm Bill go back eighty years. Today we need a food policy that recognizes the legitimate interests of all – farmers, consumers, nutrition, health, the country, and the growing food challenge facing the world. Our investments in the food system should promote our public policy goals.

What can we do?

First, we must work to free agriculture from a sterile and meaningless attachment to conventional notions of industrial efficiency, and place the consumer and the environment in which we live at the center of food policy.

Second, we must replace the myth of the family farm with the reality of farm businesses that are good for families.

Third, we should fight the farm subsidy structure. The Washington lobby for commodity interests is far more single-minded in its defense of subsidies than are most farmers.

Hunger is the lens through which we should examine the Farm Bill.

The current Farm Bill was signed into law in 2002 and is set to expire in 2007. Traditionally, it has been the commodity crops – corn, wheat, soybeans, cotton and rice – that drive the reauthorization agenda. Of the $51.7 billion in new funding included in the 2002 Farm Bill, more than two-thirds went to the commodity programs.

The 2002 bill was negotiated in 2001, before the escalating federal budget deficit and the war on terror reshaped spending priorities. A change in U.S. agricultural policy is long overdue, and it begins with commodities. Commodity programs force farmers to depend on government subsidies, divert scarce resources needed for rural development, distort agricultural markets at the expense of farmers in the developing world, and contribute to rising obesity rates in the U.S.

Farm Subsidies do not benefit most rural Americans.

Rural America has higher rates of hunger and poverty than urban areas. Unemployment and underemployment are higher, and rural America has higher concentrations of substandard housing. These conditions may not be caused directly by government payments to commodity producers, but the fact that most people consider farm subsidies a form of rural development explains why so little is left for the development strategies and programs that would improve the lives of most rural Americans.

By design, commodity payments benefit the biggest producers.

It is a myth that government payments to farmers support rural America. Areas of the country that receive the greatest share of subsidies, like the Great Plains or the Delta, have some of the highest rates of hunger and poverty, and these communities have been losing people for decades as farms have consolidated, making it increasingly difficult for small farmers to compete.

By design, commodity payments benefit the biggest producers. That is how they have encouraged consolidation. U.S. farm subsidy programs do little to help small to medium-sized family farmers, most of whom receive no subsidies and earn most of their household income by working off-farm. Nor do farm programs provide much help to growers of the so-called specialty crops, better known as fruits and vegetables, which are ineligible for subsidies. The notion that U.S. agriculture could not be competitive without the high commodity subsidies is another myth – for one thing, specialty crops remain competitive without subsidies.

U.S. farm programs favor a few thousand large corporate farming interests, much to the detriment of smaller family farmers.

Direct government support for farmers started during the Great Depression, when most U.S. farm households were extremely poor. A policy designed to be a temporary solution to address a national crisis has prevailed for three-quarters of a century. Today, average farm household income exceeds the average income of the rest of the country. The landscape of rural America is also vastly different than during the Great Depression. Less than 1% of the population in the U.S. is engaged in farming, compared to 25% in the 1930s. Roughly the same amount of farmland is being used, but the farms themselves have grown larger and more specialized, due to improvements in technology and the government programs that have encouraged consolidation. Federal farm policy has not kept pace with changes in the farm sector or with changes in rural America.

Some legislators worry U.S. agricultural imports are increasing faster than exports. But agricultural imports are serving the widespread U.S. consumer demand for products grown in other parts of the world. For many people, the state Iowa signifies farming – yet almost all of the foods Iowans eat come from out of state. Iowa farmers grow lots of corn and soybeans, but very little else. It is not because the soil cannot produce foods other than corn and soybeans. It is because it would be a disastrous business decision for farmers to rethink their planting decisions. Under the current farm program structure, they have become dependent on subsidies that give them little scope to diversify.

Federal farm policy should offer farmers tools for managing financial risk, assistance during times of catastrophic crop failure, and support for practicing good environmental stewardship. But most importantly, federal policy needs to support creativity and an entrepreneurial spirit in farming by encouraging farmers to plant the crops they choose. All farmers should be eligible for this support, not just a small handful of commodity producers.

Commodities and world hunger

U.S. farm programs favor a few thousand large corporate farming interests, much to the detriment of smaller family farmers. Their impact on small-holder farmers in the developing world is even more devastating. Subsidizing commodities encourages U.S. farmers to overproduce them. Selling these excess commodities in world markets at artificially low prices distorts trade and makes it extremely difficult for farmers in developing nations to sell their products. In spite of their much lower production costs, cotton farmers in Senegal, Burkina Faso, Chad and Mali cannot compete against highly subsidized U.S. cotton. For these African nations, where 15 million people earning roughly $1 to $2 per day depend directly on cotton, U.S. farm programs shatter hopes of reducing hunger and poverty.

There are roughly 3 billion people in the world living on less than $2 per day. Raising the income of the poorest people, even by a small amount, could be a great opportunity for U.S. farmers to expand their export markets. The demand for animal protein in particular will outstrip developing countries’ productive capacity. Midwestern producers of feed grains stand to gain from poverty reduction in the developing world.

Strong economic growth in developing countries should be a preeminent concern for U.S. farmers, but so far, farm groups have not used their powerful influence on Capitol Hill to press policymakers to understand the relationship between global poverty reduction and emerging markets for U.S. agriculture, and to take action. In the developing world, reducing poverty depends largely on improvements in agricultural productivity. Three-fourths of the poorest people in the developing world make their living from agriculture. Without large-scale growth in the agricultural sector of poor countries, broad-based economic development will not occur and the substantial new markets for U.S. agricultural products will not materialize.

Nutrition programs protect families from hunger.

Federal nutrition programs represent an investment in the health and well-being of families by ensuring that low-income Americans have access to food. The Food Stamp Program, the largest federal nutrition program, will be reauthorized in the farm bill, and so will several other programs that are smaller but still important.

There is much to praise in the Food Stamp Program. “Waste, fraud and abuse” is at an almost negligible level, such that policymakers might hold up the Food Stamp Program as an example of what other federal programs should try to achieve.

The Food Stamp Program does not ensure low-income families access to adequate amounts of healthy food. The government meal plan that the program is based on, the Thrifty Food Plan, does not meet current nutritional guidelines. Improving the Food Stamp Program will benefit families in several key ways. First, it will improve the health of families by making it possible for them to afford healthy foods for the entire monthly benefit cycle. Second, it will help increase participation. Finally, it will help the U.S. meet its pledge of cutting food insecurity in half by 2010.

Overweight and obesity affect all income groups but are most prevalent in low-income communities. Calories are cheap and abundant in the U.S. – it’s the nutrients that are expensive. Poverty limits access to healthy foods. Too poor to afford nutritious meals, many low-income households stock their cupboards with cheap but filling foods, high in fats and sweeteners.

Some public health experts contend that U.S. farm policy, by heavily subsidizing corn and soybean production, is contributing to the obesity problem. High fructose corn syrup and hydrogenated vegetable oil, by-products of subsidized corn and soybeans, are ingredients used in almost all processed foods.

Obesity is the most prevalent nutritional disease of children and adolescents in the U.S.

Hunger is the lens through which we should examine the Farm Bill. No legislator wants to increase hunger, but sometimes policies do so inadvertently because of conflicting priorities. If policies are contributing to hunger, the moral imperative should be to reform them. That does not mean eliminating support for farmers. Rather, policymakers must develop solutions that help struggling U.S. farmers, strengthen rural communities, provide an adequate, nutritious diet for hungry people in the U.S. and support the efforts of small farmers in developing countries to get their products to market and feed their families.