Trump Is Shamelessly Bribing Farmers With Cash Handouts

Georgi Boorman
 
Farmers have raked in $24.5 billion and counting from the main “bailout” program in President Trump’s aid package to farmers, supposedly intended to mitigate losses due to the disruption caused by his trade war with China. As critics have pointed out, that’s more than twice what taxpayers lost the auto industry bailout in 2009. This is despite the fact that American farmers are, arguably, far more insulated from the impact of China’s tariffs than Chinese companies are of American tariffs. Reports seem to be missing a key point, though: The auto bailouts were not direct subsidies, but losing investments through buying stock and extending loans to the failing companies. The Automotive Industry Financing Program totaled $80 billion in investments and loans. By the time the government had completely closed the AIFP, taxpayers netted a loss of $9.3 billion, most of it lost to General Motors. The farm “bailouts,” on the other hand, are neither bailouts in the sense that they are saving companies from failing, nor are they loans and investments. In total, the trade aid packages for 2018 and 2019 included $2.6 billion to purchase food staples for government food programs, $300 million for “developing new export markets,” and $24.5 billion for direct payments — cash transfers — to farmers. According to the July 2018 Department of Agriculture press release for the first round of handouts, “The Market Facilitation Program, authorized under The Commodity Credit Corporation (CCC) Charter Act and administered by Farm Service Agency (FSA), will provide payments incrementally to producers of soybeans, sorghum, corn, wheat, cotton, dairy, and hogs.” MFP payments for the 2018 trade aid package were valued up to $10 billion. In May of this year, Agriculture Secretary Sonny Perdue again announced “up to $14.5 billion in direct payments” through MFP, an amount claimed to be “in line” with the estimated impacts of the retaliatory tariffs and “non-tariff barriers” on U.S. agricultural exports. Farmers have relied on government assistance for decades through the Farm Bill, passed every five years and projected to cost $428 billion over the next half a decade. But unlike the other programs farmers and ranchers have historically depended on, such as crop insurance and price loss coverage, the MFP payments are cash paid out per unit of output (e.g. 14 cents per bushel for wheat), and farmers have packed government offices to get their share of tax dollars. NBC News reported that more than 31,000 ranchers and farmers have stacked up cash doled out through the MFP between January and April. Offices processing MFP applications have been flooded with nearly 600,000 applications submitted from September of last year through this August. Trump’s “bailout” program is so large that it has caused a processing backlog; late payments have accrued over $1 million of interest paid to qualifying applicants...MORE

The post above resulted in the following discussion on Facebook:

Sarah Henton Most farm subsidies go towards Foodstamps, SNAP, WIC & urban nutrition programs make up nearly 80% of USDA farm subsidies...
https://farmpolicynews.illinois.edu/.../focus-snap.../
That's $24 million divided among thousands of farmers... compare that to individual non-agriculture corporations like Boeing getting over $13 BILLION.. with a B... in subsidies...making it the top subsidy recipient in the U.S.... followed by these corporations making the top 8 with $2 billion or more each in U.S. ... Nike, Shell, Chrysler, General Motors, Ford, Intel & Boeing.
https://www.cheatsheet.com/.../high-on-the-hog-the-top-8.../
Subsidized health insurance costs taxpayers $685 billion a year... whether the taxpayer gets insured or not. At least you eat the food that farmers grow... and most don't get subsidies anyway.
https://www.bloomberg.com/.../it-costs-685-billion-a-year...
...and former gov Brown making Calif taxpayers subsidize $10 million for marijuana growers...
http://fox40.com/.../grant-program-aims-to-help.../
And Tesla gets $700 million in subsidies... plus it's poor yuppie customers who can afford to spend $100,000 for a Tesla get a $10,000 taxpayer-funded rebate.
https://realmoney.thestreet.com/.../tesla-s-main-product...
And taxpayers subsidize public broadcasting... who's programs often demonize the rural Americans that are forced to fund public broadcasting
https://www.heritage.org/.../stop-forcing-taxpayers-fund...
And $2 billion a year for immigrant students...
https://www.washingtonexaminer.com/.../report-tax...
And taxpayer-funded homeowner subsidies....
https://www.citylab.com/.../the-us-spends-far.../390666/
And all those grants for environmental studies... subsidies.

farmpolicynews.illinois.edu

Focus on SNAP, the Largest Farm Bill Program • Farm Policy News

Focus on SNAP, the Largest Farm Bill Program • Farm Policy News

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 Frank DuBois Sarah Henton Many thanks for all your research, there is a lot of interesting stuff there. I do not support any of the subsidy/welfare programs you’ve listed. I do not believe any of those programs that transfer taxpayer funds to those individuals or companies, including farmers, are in the public interest. They certainly do not comport to anyone who supports limited government, free markets and private property.
If your point is there are many ill-advised subsidy programs in the federal budget that should be opposed, then I am with you 100%. If however, your point is to justify the farm subsidies because of all the other subsidy programs, then I’m afraid I must disagree. In my view all of those programs are unjustified transfers of wealth. I do not support socialized medicine, or subsidies to public broadcasting, immigrants, environmental/climate change programs or any of the other items listed, and don’t believe it appropriate to use them to justify farm subsidies.
I do have one minor quibble. You write, “Most farm subsidies go towards Foodstamps, SNAP, WIC & urban nutrition programs make up nearly 80% of USDA farm subsidies”. Those programs make up 80% of the total expenditures authorized by the Farm Bill, not 80% of farm subsidies. Note the link you provided refers to “the total cost of the new Farm Bill”, which consisted of 12 Titles, only one of which had farm subsidies.
Also the Market Facilitation Program referred to in the article is $24.5 billion, not million.
I always appreciate receiving your comments and thank you for providing your input.

Sarah Henton Frank DuBois ... I don't support subsidies of any kind. I was pointing out how the media & general public single out & demonize farmers as welfare farmers while ignoring other subsidy recipients.
The general public has the impression that all farmers are subsidies & are the biggest recipients.
• Frank DuBois Sarah Henton Got it, thanks

  
  
  

  I include the discussion because it allowed me to address an error made by some of my friends and colleagues: Using other subsidy programs to justify farm subsidies. It is that type of thinking or 'explaining away' that has created many of the problems we face today.