How to Save Billions in Farm Spending

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2015-07-21
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Babcock, Bruce
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Center for Agricultural and Rural Development

The Center for Agricultural and Rural Development (CARD) conducts innovative public policy and economic research on agricultural, environmental, and food issues. CARD uniquely combines academic excellence with engagement and anticipatory thinking to inform and benefit society.

CARD researchers develop and apply economic theory, quantitative methods, and interdisciplinary approaches to create relevant knowledge. Communication efforts target state and federal policymakers; the research community; agricultural, food, and environmental groups; individual decision-makers; and international audiences.

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The most vexing problem facing Congress as it works toward completion of the farm bill is where to fi nd funding to make changes in farm legislation. High commodity prices have drastically reduced available funds that supporters of change can tap to create new programs or expand existing programs. The agricultural committees have found only two signifi cant sources of funds under their control: direct payments and the crop insurance program. Reductions in either program could fund increased nutrition and conservation programs or could be used to redesign commodity programs. The rationale for cutting direct payments is that it is diffi cult to see why crop farmers should receive subsidy payments when farm income is at record levels. The rationale for cutting crop insurance subsidies is that taxpayer support for the program has ballooned with the higher commodity prices, far outstripping the costs of actually running the program.

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