Subsidy Defenders Cheerleading for Super Congress Failure

by Don Carr, EWG

Ask almost anyone engaged in US agriculture policy, and the consensus is that the current budget crisis makes it all but inevitable that the suite of taxpayer-funded programs authorized under the federal farm bill is headed for dramatic cuts. The subsidy lobby is worried that the newly minted “Super Congress” might actually decide which programs have fat to trim or are non-essential.

One good target for the 12-member committee would be USDA’s Direct Payments program – a pot of about $4.5 billion that is paid out to farmers and landowners every year regardless of crop prices or farm income. These subsidies were supposed to be temporary when they were established in their current form in 1996, and now they may finally see their end. Back in July, they were rumored to be a main target of the bipartisan debt ceiling/deficit reduction talks led by Vice President Biden and Senate Majority Leader Harry Reid – before the negotiations collapsed.

A big question now is whether the new committee will focus on cutting outdated and wasteful farm subsides like direct payments, or kick the issue back to the Agriculture Committees.

What’s not in question is what will happen if the committee fails to come to an agreement that can pass Congress and get signed into law. The legislation that raised the debt ceiling and created the super committee will automatically trigger painful cuts across the federal government. Half would come out of defense spending, the other half from the rest of the budget, including programs that are very popular with most Americans. Farm subsidies fall in this category, as do road building, environmental protection, cancer research and many more. These cuts wouldn’t even try to target programs that generate the fewest social and economic benefits; instead, they will be sweeping, across-the-board cuts that have the potential to wreak havoc on the federal budget and the economy.

The Environmental Working Group has tracked federal farm spending with our Farm Subsidy Database since 1995. We regularly make the case that after years of high farm income and soaring crop prices, programs that pay farmers regardless of income or price are indefensible. Recently, even some of the staunchest subsidy defenders have acknowledged that direct payments have outlived their usefulness.

Not so for Collin Peterson (D-Minn.). Back in August, the ranking member of the House Agriculture Committee spoke his mind about the best course of action for the farm programs he cherishes in an interview with The Iowa Independent website. The Aug. 8 edition of The Hill newspaper summarized his stand this way:

Peterson said failure to reach a deal might be best for agriculture, since it could spread cuts more equally across a range of programs.

In other words, Peterson believes that a yearly 9 percent reduction in all farm programs – as well as in road building, environmental protection, cancer research, etc. – which would automatically take effect in the absence of a budget deal – would be much better than taking a bigger bite out of the direct payments that to go to the biggest and wealthiest farm operations and rural landowners.

It wasn’t so long ago that the Minnesota congressman was sounding downright rational when it came to cutting farm programs. In April 2010, my colleague David DeGennarro thanked Peterson for statements he made to the press signaling that direct payments were indefensible. He also spoke encouragingly about a critical conservation program.

However, much has changed in the political and budget landscape in the past 16 months. And Peterson is a reporter’s favorite, speaking his mind in wide-ranging, on-the-record conversations. His recent public comments about dodging hard budget choices to usher in destructive sweeping cuts could be a reflection of the backroom chatter of the subsidy lobby, which Peterson is always ready to defend.

It could also have something to do with the fact that Peterson’s district ranked seventh of the 435 Congressional districts in the amount of federal farm subsidies it received in 2010, and has taken in $5.7 billion for agribusiness interests since 1995. His district also ranked eighth overall in the particularly egregious “direct payments,” hauling in $1.13 billion since 1995. Corn is the most heavily subsidized crop in Peterson’s district.

Angling to protect profits for agribusiness in his district is nothing new for the former House Agriculture Committee chairman. Peterson’s actions on the failed climate bill of 2008 offer an instructive example of his agribiz-first-everyone-else-last approach. First, he weakened the bill by exacting sweeping exemptions for industrial agriculture. Then, when the Environmental Protection Agency’s science-based analysis found that corn ethanol doesn’t reduce as big greenhouse-gas emissions as the industry claimed, Peterson fumed:

I’m going to bring this climate bill down.

He offered up a whopper of a reason, telling the Wall Street Journal that a warming climate was good for farms in his district because they could grow more corn (a notion that the Think Progress website ably debunked).

Across-the-board cuts will do nothing to fix our badly broken food and farm policy; they likely will make things much worse.  Here’s hoping Mr. Peterson remembers the ideas he gave voice to in the hopeful spring of 2010.

We could use that kind of leadership now.

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