The Fraud, Waste and Abuse of the Federal Farm Subsidy Program

All American Blogger ^ | 12-5-07 | Duane Lester

[Bodhi1]

There is a combination in Washington that draws fraud, waste and abuse like bees to honey. The combination is free money plus government bureaucracy. The federal farm subsidy program has created some stories that are as unbelievable as they are outrageous.

[Bodhi1]

This is part three in a five part series. You can find part one here and part two here.

[snowrip]

I used to think that free money and beaurocracy were only the hallmarks of the democrat party.

Now, it appears that they are the hallmarks of the republican’t party as well.

[jiggyboy]

Washington will take care of farm subsidies as soon as they finish their good work on immigration reform. i.e., never.

[Bodhi1]

You are both right. Reagan said it best when he said:

“The closest thing to immortality on this earth is a federal government program.”

[elpadre]

the company from which I retired from purchased 5000 acres of farm land in the early 70’s on which to build a heavy industrial plant. When I retired over 20 years later it was still receiving checks for the tobacco base allotted to the “land” on which it was not grown.

Also, developers could and did buy land with tobacco acreage and actually sell the acreage separate from the land.

Five or six years ago there was a report published noting the high percentage of subsidized crop payments being paid to people and companies not growing the crop for which they were receiving the payment. Supposedly they, in some cases, were leasing the allotment out to some farmer who could thereby increase his.

[HD1200]

I know a lot of farmers. They are far from destitute and virtually every dime they spend they manage to turn it into a tax deductible event.......

Get a brand new $40,000 Tahoe and call it a service vehicle for the farm - write it off. Going to drive it on a hunting trip to Colorado? Put down you drove to visit a Combine dealership to check out the combines. Freezer empty? Butcher a steer and write it off as “steer died”.

[Wolfie]

I’m shocked! I was shocked the first dozen or so times I’ve read about this over the past few decades, and will be shocked the next dozen or so times in future.

[Justeggsactly]

A family only 17 miles from me receives $17,000 every year so they won’t expand their dairy operation.

[lula]

Abolish the IRS and all this will stop. So sick and tired of unfairness. People will find loopholes every time, but if they have to pay at the consumer level it evens out.

[Neoliberalnot]

Paying at the consumer level is what farm subsidies are about. Subsidies are designed to keep food in the U.S. cheap — about 11% of income, which is the lowest in the world. Eliminate subsidies and listen to the public outcry when people have to pay 20% of income to feed themselves. Either we keep food cheap or pay the market price.

I admit to owning farm ground in the Midwest. I live on it, farm it, and make a small profit. Even with subsidies, I am lucky to make a 5% return. I do deduct equipment, a truck, and other farm-related expenses, just like every other business.

[ccmay]

I am in favor of sensible, fair policies that keep farmers on their land in hard times and thereby secure our domestic food production capabilities.

However, with farm prices as high as they are now, any farmer who takes a nickel of government money is a sponging thief. Times have never been so good down on the farm, and it’s time the rest of us got our money back, or at least could take a break from shelling it out.

Also, it’s plain ridiculous the way welfare-queen dairymen and grain growers are showered in our money, while fruit and vegetable farmers get bupkis. It ought to be the other way around.

[lula]

Admittedly there is abuse out there, not everyone is at fault. We as a country need to address the way we spend money without regard for frugality. We can’t continue to tax and spend irresponsibly. If it means food prices going up to not pay 25% income tax so be it.

[Neoliberalnot]

“However, with farm prices as high as they are now, any farmer who takes a nickel of government money is a sponging thief. Times have never been so good down on the farm, and it’s time the rest of us got our money back, or at least could take a break from shelling it out.

Also, it’s plain ridiculous the way welfare-queen dairymen and grain growers are showered in our money, while fruit and vegetable farmers get bupkis. It ought to be the other way around.”

You neglect the variable weather conditions that the grain belt is subject to. Vegetable producers have much more weather-stable growing conditions. You are right that prices were high for grain this year, but my yield was down about 40% because of the drought. I barely broke even this year. Cost of inputs has also skyrocketed — seed, fuel, fertilizer, and herbicide. For comparison, my Dad sold corn in 1950 for $2/Bu and this year I got $3.60/Bu. Four years ago I sold corn for $1.80/Bu.

And for the record — I paid about 40K in federal and state taxes last year. All total, I pay close to 50% of my income in taxes of some sort. It ain’t no free ride or welfare to get to retain some portion of what I earned.

As far as dairy operations; dairies in the Midwest have declined every year for the last 20 as more of them fail to make a sustainable living. It is a very, very tough business and most operators are outstanding if they get a return of 3-4%.

[BARLF]

We have new neighbors. They are dairy farmers from New Zealand. Preparing to start up a dairy here in S.E. Missouri.

[YouGoTexasGirl]

What also happens here in Texas and probably other states is that agricultural exemptions on property taxes are given to farmers/ranchers. Property taxes are almost nothing!! I have 23 acres of land, which we have a cattle lease and my taxes are $30/year. Otherwise it would be thousands per year. Yes, I do get a meager amount for the lease although we get zero from the goverment.

My brother-in-law bought land and got “introduced” to a local ag management man who has “helped” him improve his land. Although he has put some money into it, he has received lots of expensive planning and some portion of development from this ag money floating around! It’s a vicious circle as taxpayers funded the education of their college education and now pay dearly for them to do their job in agriculture improving other’s land values.

It really is disgusting. When #43 increased the subsidies I wanted to lob him a fresh patty!

[DPMD]

Thinking of farm subsidies as government money paid for not doing something, on land that may or may not exist, leads me to wonder about government money in the form of mandatory carbon offsets. Money paid for not doing something, that is, producing carbon dioxide. Once we get over the outrage at the scams for obtaining farm subsidies or tax deductions, maybe we can anticipate the same sort of monstrosity that will be government involvement- tax increases followed by subsidies to favored individuals or organizations - in the non-production of “greenhouse gases.”