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« Beverage container recycling scorecard | Main | In the news: October 19, 2006 »
Farmers want conservation programs
& an end to payment limit abuse
Today Michelle Perez, Senior Analyst for Agriculture & Natural Resources at EWG, enlightens us about the results and implications of the survey The 2007 Farm Bill: U.S. producer preferences for agricultural, food, and public policy:
A nationally representative survey of farm producers showed that farmers are willing to consider reasonable subsidy limit policy proposals and that they continue to support conservation programs.As farmers and environmentalists begin to rally their troops in preparation for the 2007 Farm Bill reauthorization fight, both sides should take a deep breath and count what they have in common.
A September 2006 study by the Farm Foundation and others found that farmers’ support eliminating the three-entity rule and supported continued funding of conservation programs. On a scale of 0 thru 5 with 0 being “least important” and 5 being “most important,” the composite score of 15,000 farmers was 3.69 indicating, “eliminating the 3-entity rule was important.” In terms of conservation support, over 80% of the farmers surveyed, favored federal technical and financial assistance for water quality and soil erosion programs.The 3-entity rule:
Farmers and fiscal conservatives agree that the subsidy payment limit policy known as the “three-entity rule” has been abused. Originally, the three-entity rule enabled family members that farm together and grow specifically subsidized commodity crops (like corn, wheat, soybeans, cotton, and rice) to collect the limit from two additional farming entities such as partnerships or joint ventures. For example, the direct payment limit for all commodities for an individual is $40,000 per year. Additionally that farmer can receive another $40,000 per year for being a member of up to two additional farm entities, totaling $80,000 to that one individual. When it was originally developed, this policy recognized that many family farms involve more than one member and allowed the additional members to benefit from the commodity system as well.
Abuse of the 3-entity rule and unintended policy consequences:
However, some farmers have abused the system and the “three-entity rule” is widely regarded as a subsidy loophole. Some farmers game the system simply by setting up three different corporations on one farm, saying for example, that their grandmother (who happens to be in a nursing home) or their son (who is away at college in another state) or even dead relatives, are operating the other farms.In addition to fraud, the 3-entity rule encourages the honest consolidation of farms towards commercial sizes in order to stay a float in a government-controlled agricultural marketplace. Many economists acknowledge, the 3-entity rule is yet another factor forcing family farmers off the land.
As the Farm Bill ’07 fight unfolds, farmers and environmentalists should agree to agree on certain issues so that everyone leaves the debate happy and with party favors.
Thanks, Michelle.
Comments
Why not just eliminate the 3 entity rule and change the payment limitation to $80,000 per producer? Don't tell me congress didn't know what they were doing when they enacted this "loophole."
Posted by: B Allan McIntyre | October 19, 2006 7:28 PM
Dear Michelle,
Congrats for your BLOG. I am imperssed.
Love,
Dad
Posted by: Antonio T. Perez | October 22, 2006 4:43 AM
Not sure who was polled, but conservation programs like EQIP, CSP, WHIP, etc are NOT the answer. They are ok, if you happen to qualify. Just a few in certain priority areas get to participate. Very little oversight from SCS/NRCS on these cons programs. Not blaming them, just the way the programs are designed.
Changing the 3 entity rule won't save money, and probably will create more ficticious farming operations. The money is based on # of base acres.
The old idea of a deficiency payment on acres grown only would not only save money, but put $$ in the hands that are at risk. If prices were below the target price it pays, and doesn't pay, if prices average above the target price. Pretty simple and fair. Yes, bigger farmers would get more money, but would still be more fair. WE had this before the Freedom to farm 1996 farm Bill. We have it sorta with CC payments now, except we pay on base acres, and everyone with a share gets a payment, if price justifies, regardless if they had any of that crop grown that year.
A safety net is needed, no doubt. We enjoy a nice problem of over-production in US, so it's not all bad. We would freak out, if we had to start importing most of our ag products. The few dollars the taxpayers pay for a safe and reliable food supply is realized/saved hundreds of times at the grocery store.
Posted by: RJ | October 25, 2006 3:56 PM
Wonderful research and excellent work.
A return of Black Farmers in America could be facilitated in the 2007 Farm Bill.
A food secure nation may depend upon utilizing the historical legacy of Blacks in Agriculture.
Posted by: Khubaka Michael Harris | October 25, 2006 8:05 PM
Hello, I live on the family farm and I have a big factory farm above me. This huge farm keeps polluting the creek. He keeps getting a slap on the hand from the DNR. This farm once killed all the fish for miles. Anyway I know they get lots of subsidies. I think any farm that is known to pollute should be banned from all government monies. Maybe that would make them shape up!!! Thank You
Posted by: Teresa Verbsky | November 5, 2006 12:49 AM
I feel payment limitations should be done away with. Everything should be based on the acres you farm. We have alarge farming operation,and should not be discriminated against. The risk we take farming and the acres we farm should be relevant to the payments we recieve just as someone who farms less acres.
Posted by: D DeLine | November 7, 2006 10:47 PM