Thursday, August 1, 2019

Farm-aid disparities result from USDA's institutionalized economic inequality

Here’s a choice item from the 538 significant digits email Thursday morning.

10 percent of recipients
The Trump administration’s trade-war aid for farmers is not being distributed evenly. Ten percent of the recipients have received more than half the money, according to an analysis by the Environmental Working Group. Iowa Senator Chuck Grassley and the president of the National Farmers Union, among others, criticized that imbalance, suggesting that they’ll help large farms get larger and not assist the smaller farms that need the aid. [Bloomberg]

To expand, Bloomberg.com reported that the Majority of Trump’s Trade Aid Went to Biggest Farms, Study Finds. 54% of the aid payments went to just one-tenth of recipients. Even more inequality might be in the works as the President approved new $16 billion round of trade aid for 2019.

More than half of the Trump administration’s trade-war aid for farmers went to just one-tenth of the recipients in the program, according to an analysis of payments by an environmental organization.

Eighty-two farming operations received more than $500,000 each through April under the U.S. Agriculture Department’s Market Facilitation Program, according to the Environmental Working Group, which analyzed records it obtained through the Freedom of Information Act covering $8.4 billion in payments.

Roger Johnson, president of the National Farmers Union, the nation’s second-largest general farm organization, said the way the Trump administration has allotted trade aid “provides the means for the largest farms to get even larger,” at a time when the number of mid-sized family farms is declining.

“We are disappointed that USDA did not use its discretion to focus this aid on family farmers and ranchers who need it most,” added Johnson, whose organization says it represents about 200,000 farmers and ranchers.

The Trump administration has announced a new $16 billion round of trade aid for farmers this year as the trade dispute with China continues.

While the initial set of trade aid was based on crops produced, the new aid payments are to be tied to the acreage planted, making more explicit “the bigger the farm, the bigger the government check,” the environmental group said. The organization regularly analyzes and publishes detailed databases on federal farm subsidy payments, often highlighting disparities in aid.

The U.S. Department of Agriculture said in a statement that the program “is designed to provide a level of support that’s proportionate to a farm’s size and success.” It added, “Payments were made based on a producer’s individual production – the more acres they farm and bushels per acre they produce, the more assistance they receive.”

So there you have it. Let me rephrase. It is the policy of the USDA to increase economic inequality, paying large growers at the expense of assistance for the family farm.

It gets worse.

The environmental organization, which published a searchable database of trade aid recipients on its website Tuesday, said the top 1% of farmers were paid an average $188,000 while the bottom 80% averaged less than $5,000.

Trade aid payments are capped at $125,000 per person in each of three categories of commodities: one for soybeans and other row crops; one for pork and dairy; and one for cherries and almonds.

… farms set up as corporations or partnerships can exceed those limits. Relatives and partners who don’t live or work on a farm can collect payments as long as they help make management decisions such as what to plant, said Scott Faber, senior vice president for government affairs for the environmental organization.

The organization also found that thousands of farm trade aid recipients live in the nation’s largest cities.

“When Market Facilitation Program payments continue to overwhelmingly flow to an elite group of the largest farms, wealthy landowners and city residents with no real connection to the day-to-day operations on the land, it’s clear the program is deeply flawed and not delivering aid to those farmers in desperate need,” said Donald Carr, a senior adviser to the group.

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