WASHINGTON – A diverse group of taxpayer, farm, and environmental groups today urged Congressional leaders to reject attempts to increase reference prices for covered commodity crops as Congress debates the farm bill.
The organizations participating in the press conference included National Taxpayers Union, Taxpayers Protection Alliance, Taxpayers for Common Sense, R Street, Environmental Working Group, Rural Coalition, the National Sustainable Agriculture Coalition and Farm Action.
On May 1, the groups sent this letter and this letter to the chairs and ranking members of the House and Senate Agriculture Committees opposing increases in reference prices.
Here are the participants’ statements.
Bryan Riley, National Taxpayers Union
“Many U.S. agricultural producers do just fine without price supports. For those that utilize price supports, increasing reference prices would increase their dependence on the federal government and increase potential costs for American taxpayers.”
Marty Irby, FreedomWorks
“FreedomWorks stands firmly against increasing subsidies and spending federal tax dollars that we don’t have just to line the pockets of multi-millionaires who are beholden to multinational conglomerates like the Chinese-owned Smithfield and Brazil-based JBS. Increasing PLC reference prices does little to help the family farmers who are barely making ends meet and Congress should reject this costly proposal that would add to the national debt.”
Josh Sewell, Taxpayers for Common Sense
“The push to increase government-enforced crop prices is a naked cash grab. The ag sector is projected to suffer from $137 billion in net farm income this year. That’s net; income after costs. This after a 50-year high of nearly $168 billion in 2022.
“Title 1 subsidy programs haven’t paid out because farmers have made money in the market. Their bottom lines show it. The push to increase government-mandated prices for a small number of crops handpicked by the farm bill writers would be laughable if it weren’t unconscionable. $32 trillion in debt. Potentially days from default. Yet some lawmakers, demanding austerity from everyone else, are looking to dig deeper into our pockets to replace markets with mandates for a few special interests. It’s not fiscally responsible. It’s not right. It’s not gonna happen.”
Dan Savickas, Taxpayers Protection Alliance
“The Taxpayers Protection Alliance exists to educate the public about the government’s impact on the economy. We strive to hold politicians accountable for those effects.
In the past, TPA has been a vocal advocate of a market-oriented farm bill and that will not change for this year’s version.
“Farmers should be allowed to compete freely in the marketplace. Farms are, for all intents and purposes, businesses. And farmers are businessmen and women. They buy and sell products and services like any other. They should be allowed to reap the rewards of competition domestically and internationally, as should consumers.
“TPA, like other free market groups and individuals, have highlighted the inefficiency of seeking to insulate any business or sector of the economy from market forces. This promotes a poor allocation of resources. Further, price controls of any sort distort the market and impact production levels. Many politicians who are advocating for an increase in reference prices recognize these basic truths for most all areas of the economy (from prescription drugs to wage labor and more), but turn a blind eye every five years once the Farm Bill comes around and it’s time to consider reference pricing for commodities.
Agricultural America should be no different. The American taxpayers should not be on the hook for shielding some farms, crops and commodities from market forces while the government picks winners and losers in the market. That’s why we urge Congress to reject an increase in PLC reference prices.”
Nan Swift, R Street
“Those large, wealthy farms that would benefit most from any increase in reference prices already reap the rewards of an overly generous safety net that guarantees income and even a market for their products, in the form of the Renewable Fuel Standard that relies heavily on corn and soy inputs.
“By any conventional measure a reference price hike is both unnecessary and would exacerbate the many unintended consequences already associated with the problematic federal commodity programs. It would add to our record debt and make future reforms much harder to achieve. Sadly, taxpayers, consumers and the environment will all continue to pay a high price if this proposal moves forward.
“Congressional Republicans will recall that after the Affordable Care Act passed there was a scramble to enact reforms before people began to receive the bulk of the new subsidies scheduled to be implemented in 2014. That was because we understand how hard it is to walk back a subsidy once people start to enjoy its benefits. This economic rule continues to apply regardless of the constituency.”
Billy Hackett, National Sustainable Agriculture Coalition
“The National Sustainable Agriculture Coalition, or NSAC, stands with this alliance of farm, environment and taxpayer groups to oppose raising Price Loss Coverage reference prices in the 2023 Farm Bill – a time when gross farm income is higher than ever. Taxpayer commodity program subsidies were designed as a safety net tool, triggered when necessary, to help protect against unpredictable losses that are part of farming – NOT an annual entitlement program for the country’s most successful farms.
“Roughly 10 percent of farms receive 70 percent of farm program subsidies and $90 billion in ad-hoc disaster assistance has been allocated to these producers above farm bill spending since 2017. Blindly throwing more money at a system that cannot sustain itself is no solution.
“NSAC represents a diversity of American agriculture, including beginning, small- to mid-sized, specialty crop and diversified farmers. Even as USDA advises more than half of our diets be composed of fruits and vegetables, it is precisely these producers who are not eligible for federal commodity programs and continue to face barriers to access crop insurance or credit.
“NSAC’s vision for the 2023 Farm Bill is one where the farm safety net is made accessible to all producers requiring protection against worsening disasters while supporting proven on-farm risk management strategies that can reduce reliance on a safety net in the first place. Rather than applying a temporary bandage, investing in practices that improve soil health will expand farmer’s economic bottom lines, improve resilience against weather-related events, and reduce public safety net costs in the long run.”
Scott Faber, Environmental Working Group
“We need a farm safety net, and some farmers are struggling. But increasing the price guarantees in the Farm Bill will not help struggling farmers. That’s because most farmers do not grow the crops that are eligible for these subsidies. That’s also because these subsidies overwhelmingly flow to the largest and most successful farmers who – according to USDA – are enjoying farm household income of more than $1 million a year.
“By any measure, large farmers are doing well. Net income is near record levels. Crop prices remain high. And the cost of production remains well below crop prices. Farm equity is rising. And farm bankruptcies are the lowest in recent memory.
“Some farmers are struggling, but the farmers who would benefit from increases in price guarantees are not. We may not agree about ways to help struggling farmers, but we do agree that increasing price guarantees, as some in Congress have proposed, will not.”
Joseph Van Wye, Farm Action
“At Farm Action, we believe our farm safety net is important and helps keep farmers on their land to feed their neighbors and nourish their communities. But even though farm income reached all-time highs this year, fewer than 10 percent of our farmers made money through their farms. And more than 50 percent actually lost money.
“Major corporations and the largest farming operations in the country have used their influence to take advantage of our already poorly targeted farm programs. Today, the majority of farm subsidies go to the biggest farm corporations with the deepest pockets, while most farmers are cut out of these programs altogether.
“But it’s not just the largest farming operations who would benefit from increasing PLC reference prices. Providers of inputs like fertilizer, seed and chemicals also stand to profit from this expensive mistake.
“Agricultural input costs rose well above the rate of inflation over the last two years. Dominant corporations selling these products blame these price hikes on supply chain disruptions – but are contradicted by their own financial documents.
“In looking at these documents, along with other Farm Action research, we find evidence that input providers charge farmers based on what they are able to pay, tying the cost of their products to expected commodity prices, not to actual market factors such as supply and demand. And according to these companies’ statements on last week’s earnings calls, they’re optimistic that prices for their goods will remain high.
“Therefore, we at Farm Action strongly urge Congress to reject proposals to increase reference prices as a misguided solution to the current economic situation plaguing family farmers. While we support efforts to improve and strengthen farm safety programs for all farmers, we cannot support increases in PLC reference prices that will ultimately be captured by just a few large corporations. Instead, we call on Congress to address the real issue at hand here: unprecedented monopoly power in agriculture input markets.”
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The Environmental Working Group (EWG) is a nonprofit, non-partisan organization that empowers people to live healthier lives in a healthier environment. Through research, advocacy and unique education tools, EWG drives consumer choice and civic action.