Posted April 9, 2014
Senators Jeanne Shaheen (D-NH) and Tom Coburn (R-OK) recently introduced legislation that would cap crop insurance premium subsidies at $70,000 per farm each year, according to an Agri-Pulse article available here.
The Senators say the new limit would save $1 billion over 10 years “and would impact less than 1.3 percent of producers” according to a 2011 report from the Government Accountability Office.
“Crop insurance subsidies are yet another example of egregious government spending that needs to be reeled in,” said Senator Shaheen.
“Crop insurance premium subsidies should go to those who need assistance rather than those who don’t,” said Senator Coburn, who previously co-sponsored legislation with Senator Dick Durbin (D-IL) to apply means testing to crop insurance purchasers.
The Environmental Working Group (EWG) praised the legislation. “The largest and most financially secure farm businesses harvest most of those subsidies, and this bill is a good start toward leveling the playing field,” said Craig Cox, EWG’s senior vice president of agriculture and natural resources.
Crop insurance premiums, unlike federal commodity programs, are partially paid for by farmers and subsidized by the federal government at an average rate of 62 percent.
There is no limit on premium support, according to an article by Oklahoma Farm Report available here. As a result, “26 policy holders received over $1 million” in crop insurance subsidies in 2011 and over 10,000 policyholders received more than $100,000 each, according to EWG research.
For more information on crop insurance, please visit the National Agricultural Law Center’s website here.
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