Tags: Farm | subsidies | billionaires | insurance

Billionaires Reap $11 Million in Farm Subsidies

Thursday, 07 November 2013 11:33 AM

Federal farm subsidies were paid to 50 billionaires or businesses in which they held a stake, and their payouts are about to increase if proposed changes to the farm bill are passed.

The billionaires who received the $11.3 million in farm subsidies from 1995-2012 have a $316 billion collective net worth, according to a report from the Environmental Working Group.

The identities of those making money from farm subsidies was determined when the Environmental Working Group matched its Farm Subsidy Database with the Forbes 400 list of the richest people in America.

Those on the list include Paul Allen, co-founder of Microsoft; Charles Ergen, co-founder of Dish Network; Penny Pritzker, U.S. commerce secretary; and S. Truett Cathy, founder of Chick-fil-A.

"The irony is that farm subsidies are going to billionaires at the same time that there are proposals to kick 3 million to 5 million people off of food stamps," Scott Faber, vice president for government affairs at the Environmental Working Group told The New York Times. "This clearly highlights the need for reform to our farm programs."

The Environmental Working Group noted that many of the same billionaires also may have benefited from crop-insurance subsidies, but this couldn't be confirmed because the identities of crop-insurance policyholders cannot legally be disclosed.

However, the Washington-based research group could determine that there are more than 40 billionaires, whose properties grow corn, soybeans, wheat, cotton, and sorghum — which are the most likely crops covered by the federal crop-insurance program.

Both houses of Congress are working on farm bills that include shifting subsidies to the more generous crop-insurance program from programs that are subject to means testing. The crop-insurance program is not subject to means testing, payment limits, or conservation requirements, like traditional farm subsidies.

"So basically the bills would allow billionaires to get even more in subsidies, all without taxpayers knowing who they are, while imposing draconian requirements on low-income people," Faber said.

The Senate and House farm-bill conference committee is debating whether it should add crop- insurance means testing. If passed, it would lower premium subsidies for the top 1 percent of farm businesses.

The crop-subsidy program started during the depression, to keep struggling farmers from going under, but affluent growers now see it as a way to gamble on risky plantings.

Republican House Budget Committee Chairman Paul Ryan has referred to the crop-insurance program as "crony capitalism," and President Barack Obama would like almost $12 billion cut from the program over the next 10 years.

Some cite farm subsidies and crop insurance as examples of out-of-control government spending. Both Republicans and Democrats think the programs need to change.

"We have been subsidizing some of the farmers who least need it in a way that is really costing taxpayers a lot of money," said Democratic Sen. Jeanne Shaheen of New Hampshire. "We're never going to solve our budget challenges if that's what we're doing."

Former Republican Rep. William Frenzel of Minnesota, who now works for the Brookings Institution, agrees.

"The crop-insurance program is terrible budget policy," Frenzel said. "It's the kind of congressional back-scratching that got us into our debt and deficit situation."

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Federal farm subsidies were paid to 50 billionaires or businesses in which they held a stake, and their payouts are about to increase if proposed changes to the farm bill are passed.
Thursday, 07 November 2013 11:33 AM
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