Source: Congressman Jeff Flake (AZ-6th), 7/12/11

With the debt-ceiling debate looming, unemployment hovering near double digits, and the national debt approaching $14.5 trillion, the current economic environment should be anything but conducive to unwarranted, multi-billion dollar subsidies like so-called “direct payments” for agriculture.

Created in the 1996 Freedom to Farm Act, they were intended to serve as a temporary transitional handout to farmers as they moved in a more market-oriented direction.  Instead of expiring, Congress made direct payments permanent in 2002 and they have cost taxpayers more than $41 billion since then.  Amounting to an approximately $5 billion annual giveaway,  direct payments go to farmers and property owners because historically their land produced wheat, corn, grain sorghum, barley, oats, upland cotton, rice, soybeans, other oilseeds, and peanuts.  These fixed direct payments are not tied to current production or prices and do not require any current commodity production on the land.  This equates to individuals receiving billions in taxpayer subsidies whether they farm or not, whether prices were high or low, or whether yields were great or poor.

With the nation’s attention fixed on reducing the deficit, reducing and reforming farm subsidies is a common thread in deficit reduction plans across the ideological spectrum.  Even the Iowa Farm Bureau has seen the writing on the wall and supports the elimination of direct payments in favor of deficit reduction and an improved revenue insurance program.  Deep cuts in farm program spending are on the horizon and I can think of no better place to start than with direct payments.  To that end, I have introduced and urge support for “The Reducing the Deficit through Eliminating Agriculture Direct Payment Subsidies” or REAPS Act of 2011.  A preliminary score from CBO indicates that the REAPS Act would save taxpayers $28 billion over the next ten years.

Sincerely,
JEFF FLAKE