In 2012, the federal government paid some $5 billion in direct payments to farmers of wheat, corn, barley, oats, cotton, rice, soybeans, peanuts and other crops -- except the recipients cannot all be farmers. According to the Environmental Working Group, 116 of those tillers of the earth reside in San Francisco. For their farming activities, they pocketed $446,302.
How is it, you might ask, that a government saddled with $17 trillion in debt can afford to send checks to more than 18,000 urban farmers? The group's senior vice president for government affairs, Scott Faber, calls the direct payments program "one of the most ridiculous" government programs in recent history, as it pays "farm subsidies to farmers regardless of whether they have suffered a loss or whether they even planted a crop."
Of course, the program was born as a reform. The 1996 Freedom to Farm Act was supposed to wean farmers off New Deal largesse by phasing out agriculture subsidies through direct payments. But old subsidies neither die nor fade away. In 2002 and 2008, Congress extended the program.
Because direct payments are based on a producer's historical output, Uncle Sam sends checks not only to working farmers but also to landowners who don't plant crops. A quarter of direct payments made from 2003 to 2011 -- $10.6 billion -- went to landowners who didn't grow the crop that sprouted the subsidy or didn't grow any crop at all.
Why not get rid of direct payments? Politicians from both parties say they want to do so. In 2011, President Barack Obama proposed gutting the program as a common-sense reform. House Budget Committee Chairman Paul Ryan agrees. "Taxpayers should not finance payments for a business sector that is more than capable of thriving on its own," quoth Ryan. Senate Agriculture Committee Chairwoman Debbie Stabenow proposed eliminating direct payments to meet sequester cuts required in the 2011 Budget Control Act.
Indeed, both the Senate and House passed farm bills this year that eliminated the $5 billion annual boondoggle.
Yet direct payments may live on.
The House, you see, cut direct payments -- but in a farm bill that purposely omitted food stamps. The idea was to curb the growth in government assistance for the needy, a program that had doubled in size since Obama took office. Citizens Against Government Waste was part of a conservative coalition that pushed for the split in order to break up "an unholy coalition of urban representatives, who support food stamps, and rural representatives who support commodity programs." Cut the support, was the thinking, to cut the funding.