Lawmakers in the farm states are making efforts to form a brand new type of subsidy that would provide farmers with protection when they face a drop in revenue.
This program is unprecedented and would provide farmers with billions of dollars in future support to farmers who are currently experiencing record breaking high prices for their crops.
This free insurance subsidy would give farmers with the coverage they need for “shallow crop losses” that are incurred before their paid insurance policies become effective and has the support of soybean and corn farmers – those who stand to benefit the most from it.
It would also mostly eliminate some other types of subsidy programs, such as those currently benefitting cotton and rice farmers in the South through direct payments. Regardless of the prices or crop yields, farmers will be able to receive direct payments from the new subsidy program. In fact, they wouldn’t be required to grow anything at all.
There are also a wide range of critics to this income protection plan. They include several environmental groups, conservatives who claim that the government won’t save much money from the changes, and even one of the largest farm groups in the country is opposed to it.
The American Farm Bureau Federation has stated that this new form of income insurance would make farmers more inclined to make higher risk choices, making land more expensive.
The House and Senate Agriculture Committees’ top Democrats and Republicans are seeking to work the new subsidy program into a proposal for a farm bill that is currently being developed as an element of the congressional super-committee’s efforts to reduce farm spending in order to lower the deficit.
