by intern Valerie Scott
In his 2011 budget President Obama proposed to make cuts in farm subsidies and the crop insurance program that would save almost 11 billion dollars over 10 years. This proposal – Obama’s second attempt to cut farm subsidies – was rejected last Wednesday by the House Agriculture Committee .
Since the passage of the 2008 Farm Bill, farmers eligible to participate in the subsidy program must make no more than $500,000 in adjusted gross income (AGI) from off-farm sources and no more than $750,000 on-farm AGI. The newest Obama farm cuts would have lowered these eligibility caps to $250,000 off-farm AGI and $500,000 on-farm AGI. Direct payment caps were targeted for cuts of 25%, from $40,000 to $30,000 annually. A cut of $8 billion from the Federal Crop Insurance Program was also proposed.
The Obama administration’s first unsuccessful attempt to cut farm subsidies in 2009 focused on phasing out direct payments to farmers with annual sales of more than $500,000. Direct payments are a highly controversial subsidy given to farmers based on the size of their farm and the commodity they grow – regardless of crop prices or production levels. In 2007, a year of high crop prices and record net income for farmers, taxpayers paid out $5 billion in direct payment subsidies. Despite the current deficit crisis, cuts in even the most controversial subsidies to wealthy farmers clearly remain an uphill political battle.
Farm subsidies primarily benefit growers of just five crops – corn, soybeans, wheat, cotton and rice. With Congress currently giving school lunch programs just $1 per meal for a generation of children afflicted with epidemic levels of obesity and diabetes – can we really afford not to put those 11 billion dollars towards better nutrition programs?