Stimulus aid to farmers shows what’s wrong with U.S. farm policy

April 9, 2020 7:00 am
Cows on dairy farm

Photo by Scott Olson/Getty Images

Panicked food buying spawned by the coronavirus has, for now, drawn public attention to my often-ignored profession: farming. So, I was happy to see that the $2 trillion pandemic aid bill coming out of D.C. included $23 billion for agriculture.   

It’s especially good to see $9.5 billion going to farmers who raise food for local and regional markets such as schools, restaurants and farmers’ markets. The coronavirus outbreak could cost the economy $1.3 billion as a result of the sales hit local and regional foods are expected to take by May, according to Colorado State University and the University of Missouri. The majority of farms involved in local and regional food systems are small and often operated by beginning farmers like my son, Chris, who is trying to get an organic dairy off the ground.

The bad news is the bulk of the agricultural money — $14 billion — is going to the Commodity Credit Corporation, the USDA branch forking over farm aid as a result of President Trump’s last-man-standing trade war. Those trade bailout payments mostly benefit some of the largest agricultural firms in the country, not folks like me. Of the tens of billions of “Market Facilitation Payments” made during the past few years, the top 10% of recipients — the largest, most profitable industrial-scale farms in the country — got half, says the Environmental Working Group.

Farmers and consumers are at the mercy of an increasingly powerful small group of players in the food industry, and that’s not good, especially during a pandemic.

Here in Minnesota, giant Molitor Farms of Cannon Falls received almost $1.4 million in trade bailouts in 2018 and 2019. Nationally, the top 1% of recipients received an average payment of $177,000 during one round of payments; the bottom 80% got an average of around $5,000. Our farm received a total of around $30,000 in Market Facilitation Payments the past few years; a fraction of the $300,000 I estimate we lost to the trade war.

This unfair tilt is no surprise, given that the federal government has long favored mega-ag via policy initiatives such as crop insurance and crop subsidies. So, who do you think will be crowding the trough to lap up as much coronavirus money as they can? And the bill gives one man, Sonny Perdue, a lot of leverage in determining who will get farm checks. During a talk he gave in Wisconsin last fall, Perdue, who is Trump’s Agriculture Secretary, said, “In America, the big get bigger and the small go out. I don’t think in America we, for any small business, have a guaranteed income or guaranteed profitability.”

But Perdue has no problem supporting policies that guarantee profitability to some of the largest agribusiness firms. His statements, and actions, make it clear he’s fine with the current uncompetitive situation in agriculture, where, for example, four firms control 85% of the beef slaughter and almost 80% of soybean processing. No wonder the 2019 median farm income for U.S. farm households was negative $1,383. My fellow dairy farmers have been especially hard hit as mega-operations flood the market with an oversupply of milk; Minnesota alone lost 250 dairy farms in 2019.

Farmers and consumers are at the mercy of an increasingly powerful small group of players in the food industry, and that’s not good, especially during a pandemic.

This crisis will produce more bailouts and more policy initiatives, both on the federal and state level. The focus this pandemic is bringing to food and farming could bring about long-term changes to agriculture — for the good as well as the bad. The stimulus package’s support for local and regional food systems represents a positive path. The open checkbook approach of the rest of that money offers more of the same, which will result in decimated rural communities, dirty water and a monopolized food system.

We need to think beyond this pandemic and get involved in determining who makes decisions about what kind of farming our policy supports. I belong to the Land Stewardship Project, which has long advocated for a more regenerative, family-farm based type of agriculture. Recently, the Land Stewardship Action Fund was started as a sister organization that works on electoral politics. Such work is needed since some officials representing rural areas are often either actively working against us or being complacent by failing to stand with us. We need to identify, support, and ultimately grow candidates in a variety of offices and representing a variety of political affiliations who know the importance of an agriculture that supports the land, our communities and our people.

As the system for distributing agriculture funds — during a crisis as well as in normal times — shows, public policy created this mess, and public policy can get us out of it.

Our stories may be republished online or in print under Creative Commons license CC BY-NC-ND 4.0. We ask that you edit only for style or to shorten, provide proper attribution and link to our web site. Please see our republishing guidelines for use of photos and graphics.

Darrel Mosel
Darrel Mosel

Darrel Mosel raises crops and livestock in Sibley County and serves on the Land Stewardship Project’s federal policy committee.