Save the EWG Farm Subsidy Database!

April 27, 2012

When the Environmental Working Group released the 2011 edition of its groundbreaking farm subsidy database, they asked for my comment to use in their press release. I was more than happy to do so, and I had this to say:

I can think of fewer initiatives that have had as big an impact on the American farm subsidy debate as EWG’s database. By shedding light on just who gets these subsidies, how much they get, and where they reside, the EWG has exposed U.S. farm programs for what they are: expensive, outdated, distorting, regressive ways for politicians to shovel money to their powerful special interest friends. When American agriculture is finally free of the shackles of government intervention, it will in large part be thanks to the folks at the Environmental Working Group.

No good deed goes unpunished, of course, and the wonderful work of the EWG has annoyed many in the farm lobby.  But it is a crucial part of the farm bill reform effort, not to mention a good way for taxpayers to learn where their money goes. And judging by the bill voted out of the Senate Agriculture Committee yesterday, it seems we’ll need every piece of ammunition available if we are to see any reform to U.S. agricultural policy. The Committee’s bill would end direct cash payments—based on historical production and not linked to current production or prices, and therefore relatively less distorting—but increase the role of subsidized crop insurance that would protect farmers from falls in revenue.  (Here’s Chuck Abbott from Reuters with a nice summary).

Adding insult to injury, the fact that farm support seems to be turning towards a greater emphasis on crop insurance is not good news for taxpayers who thinks they have a right to know where their money is going. That’s because the Federal Crop Insurance Act (in SEC. 502. 7 U.S. C. 1502 (c), available here) prohibits the Risk Management Agency of the United States Department of Agriculture from disclosing information about who receives crop insurance subsidies, other than in aggregate form. And a Freedom of Information Act request won’t help, because the FCIA has stated that crop insurance subsidy information is exempted from FOIA provisions (in 5 U.S.C. § 552(b)(3)).

So, in short, the more we move toward crop insurance, the less EWG—and the public—will know about where money is going.

It’s considerable money, by the way: the USDA (i.e., you) spent $7.4 billion on crop insurance subsidies in 2011, plus $1.3 billion in administrative and operating expenses for insurance companies. The federal government pays an average of 62 percent of the total premium costs (up from 37 percent in 2000). The Government Accountability Office released a pretty damning report on crop insurance last month, saying that the RMA doesn’t do enough to prevent fraud and abuse of the system, and calling for cuts to premium subsidies.  According to the report (pp. 19-20), one farming business (of course, we don’t know who, thanks to the FCIA) received $1.8 million in premium subsidies in 2010, plus an extra gift from the taxpayer in the form of a $309,000 payment to insurance companies to administer the farm’s insurance policies. Another farmer insured crops in eight counties and received about $1.3 million in premium subsidies.  The largest recipient was a corporation that insured nursery crops across three counties for a total of about $2.2 million in premium subsidies and over $800,000 in administrative expense subsidies.

I’ll stop there before I start a riot, and return to my main point, which is this: I suspect my opinion on the proper role of government differs from that of many staff at the EWG, and I disagree with parts of the platform they are proposing for the upcoming farm bill. But I’ve nothing but respect for the good folks working there, and nothing but profound admiration for the fine work they’ve done. If we are to see any change in agricultural policy in this country, the EWG must be allowed to continue that work, and to have access to the information that enables it. It’s nothing short of shameful that politicians want to limit that access.


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