Farm Policy Hoax: Saving Small Family Farms
January 24, 2007
by: John Frydenlund

Wastewatcher, January, 2007

When Congress considers the farm bill this year, there is one certainty: an endless number of senators and representatives will parade down to the Senate and House floor imploring their fellow legislators to continue status quo agriculture policy in order to preserve the small family farm.

However, that claim will sustain one of the biggest hoaxes that have ever been played on the American people. Thanks to farm policy enacted by the most recent farm bill of 2002, the federal government paid out approximately $25 billion in 2005 to subsidize producers of a handful of farm commodities. Between 2002 and 2006, the subsidies and so-called disaster assistance cost taxpayers $100 billion.

This money did not go to save the poor, struggling family farmer. Despite what the farm lobby and its mouthpieces in Congress will say, the main beneficiaries of this wild spending spree have been not been needy farmers.

In 2003, the top 10 percent of farm subsidy recipients collected 72 percent of total subsidies. The largest 10 percent of grain farmers, with an average net worth of $2.4 million, received 50 percent of all grain subsidies. Sixty percent of sugar program benefits go to the wealthiest one percent of sugar farmers. Most of the farm subsidy largesse flows to individuals whom are 10 times as wealthy as the average American family and have average annual incomes of more than $230,000 - four times the income of the average American household.

Furthermore, landlords own 60 percent of U.S. farmland eligible for subsidies, but 95 percent of them don’t even farm.  These absentee landlords collect subsidy checks directly from the government, while also grabbing much of their tenants’ subsidy payments through higher rental rates.

Despite record-setting amounts of money being spent in the last decade on farm subsidies, small farmers that depend on farming for their livelihood continue to disappear. According to the U.S. Department of Agriculture’s (USDA) 2002 Census of Agriculture, the number of farmers decreased by almost 100,000 since 1997 and average farm size increased from 431 to 441 acres. Other than an increase in the number of farms between 10 and 49 acres, which are primarily hobby farmers (i.e., they mainly rely on off-farm income to make a living), the only other category by size of farms that increased was those with 2,000 acres or more. Similarly, there were increases in the number of farms that had sales of less than $2,500 and those with sales of more than $500,000, but decreases in all other categories.

Observers of farm policy debates should recognize that farm subsidy advocates indulge in a bit of obfuscation when discussing the number of farmers. According to USDA, there are 2.1 million farmers in the U.S. However, 60 percent of them have sales of less than $10,000 annually (another 10 percent have sales of more than $10,000, but less than $25,000), which means that many of these are hobby farmers. Those that are receiving subsidies are getting only a pittance and certainly not enough to help them survive.

Don’t be fooled again. No matter what one hears when the farm bill debate begins, farm subsidies do not benefit small farmers. They make rich farmers richer, drive up the price of land which forces small farmers to leave, and concentrate wealth in the hands of the shrinking landed class. It really is as simple as that.