NTU urges all Representatives to vote “NO” on H.R. 2, the “Agriculture and Nutrition Act of 2018.” This legislation is a step backward for agriculture policy, expanding on policies that provide subsidies for the wealthy and leaving taxpayers exposed to high risks and costs.
The House Agriculture Committee deserves credit for including commonsense work requirements for Supplemental Nutrition Assistance Program (SNAP) recipients in H.R. 2. These reforms rest on the basic principles that limited resources should be allotted to those who need them most, that long-term reliance on government assistance should be discouraged, and that decision-making power shouldn’t be centralized with bureaucrats in Washington. Unfortunately, H.R. 2 does not consistently apply these core free-market values across the agriculture portions of the bill.
Instead, the bill expands access to subsidy payments to recipients’ cousins, nieces, and nephews, eliminates means-testing and payment limits for joint ventures and other types of pass-through entities, and extends subsidy eligibility to each member of those partnerships. This massive expansion of taxpayer-funded subsidies increases the likelihood that payments go to individuals who do not actively participate in the management of the farm or directly bear the cost of any losses. Already, the top ten percent of farms receive more than sixty percent of all subsidies, including many millionaires and even billionaires. H.R. 2 would ensure that those at top would receive even more.
This legislation also sets increased commodity reference prices, some at more than 100 percent of market value, virtually guaranteeing payouts for some crops and divorcing planting decisions from real-world market conditions.
Modest reforms proposed in the Administration’s FY19 budget such as decreasing taxpayer support for crop insurance premiums, lowering the guaranteed rate of return for crop insurance companies, along with other amendments to limit commodity payments to actively engaged farmers and one farm manager per farm, means testing, and spending caps, all would have dramatically reduced the corporate welfare that afflicts current farm policy.
As written, H.R. 2 exacerbates the environmental, moral hazard, and market distorting problems inherent in our dated agriculture programs. These increase costs for both taxpayers and consumers. The true price tag of H.R. 2 is likely far higher than Congressional Budget Office estimates. At the same time, current policy discourages the innovation and efficiency that could make our farm economy even more resilient and responsive toward consumer demand. Legislators should oppose this carte blanche extension of the failed policies of the past.
Still, in an effort to improve the underlying bill, all legislators should support amendments that would move farm programs in a more free-market direction and reduce cronyism.
Roll call votes on H.R. 2 will be included in our annual Rating of Congress and a “NO” vote will be considered the pro-taxpayer position. The weight assigned to this vote in our scorecard will be determined after the amendment process.