Academic reports dig into government ag spendingWASHINGTON — A series of academic papers written by Montana State University professors with the theme “American Boondoggle” presented at conferences in Washington recently amounted to a “week-long hatchet job” intended to “tar and feather” farm programs, according to a top House Agriculture Committee aide-turned-lobbyist.
By: Jerry Hagstrom, Special to Agweek
WASHINGTON — A series of academic papers written by Montana State University professors with the theme “American Boondoggle” presented at conferences in Washington recently amounted to a “week-long hatchet job” intended to “tar and feather” farm programs, according to a top House Agriculture Committee aide-turned-lobbyist.
The American Enterprise Institute, a conservative, market-oriented think tank, has released a series of 12 papers commissioned from scholars, and under the banner “American Boondoggle: Fixing the 2012 Farm Bill” had planned to hold a series of briefings for congressional staff. All the papers are critical of government farm programs except a paper on research and development, which says that those programs should be expanded. The AEI papers can be found at www.aei.org/americanboondoggle.
Insurance and aid
At a recent session, scholars suggested that crop insurance programs and disaster aid should be abolished, although they acknowledged that crop insurance is so popular that ending the program is unlikely.
Tom Sell, who was deputy chief of staff at the House Agriculture Committee when former Rep. Larry Combest, R-Texas, chaired that committee, urged the staffers to remember, “We are blessed by a strong agriculture sector. We have been free of want for many generations.”
Farm programs make up only one quarter of 1 percent of the federal budget and “provide a little anchor of stability in an otherwise risk business,” said Sell, who now is in business with his former boss in Combest-Sell, a firm that lobbies for a variety of agricultural interests, including crop insurance.
For AEI to devote so much “pomp and expense” to the farm bill while the country is facing a serious budget deficit involving many other programs amounts to “Nero fiddling while Rome burned,” Sell said, adding, “I’d love to see time spent on how we are going to get out of this mess.”
He pointed out he was not saying farmers should be exempt from cuts to resolve the budget crisis, but noted that spending on many farm programs has gone down in recent years.
Noting that farmers have large-scale capital investments, bear weather risks and cannot control worldwide commodity markets, Sell said that “anyone who would say that (agriculture) is not an exceptionally risk business” is “arguing with history.”
Critical of subsidies
Vincent Smith, a Montana State University agricultural economics professor who wrote the crop insurance paper, acknowledged that farming is risky, but said since farms fail at a lower rate than other small businesses, such as trucking, subsidies cannot be justified.
Sell replied that he sees the farm program more as an economic program than a welfare program because so many other businesses are dependent on farm production. All farm challenges cannot be addressed through tax breaks, he said, because those tax breaks assume a flow of income.
In his presentation, Smith suggested that the farm premium subsidy be capped at perhaps $10,000 per farmer, with farmers who take that money required to insure all their acreage. After the event, Smith said he thinks that the Farm Service Agency could enforce the insurance requirement.
Tara Smith, a Senate Agriculture Committee aide, said bankers consider crop insurance vital for making loans. Vincent Smith replied that farmers got loans before the crop insurance program was expanded in 1980. But Sell noted commodity target prices that triggered subsidy payments were relatively higher at that time.
Myles Watts, another Montana State University professor, wrote a paper calling for an end to the supplemental revenue assistance payments program known as SURE.
Watts said he has been surprised to find more popular support for farm programs than for food stamps to feed low-income people. Such a view, he said, is counterintuitive. But since people support farm programs, he said, “We better figure out how to improve them.”