By Vincent H. Smith
Presidential elections cycles often have little or no relevance for federal farm subsidy programs. This year may be different.
Representative Colin Peterson (D-Minn.), the chairman of the U.S. House Committee on Agriculture and a titan when it comes to farm subsidies, is in the re-election fight of his life, apparently 10 points down in his race against Michelle Fischback, a well-known Republican candidate. Fischback has consistently emphasized her strong support for Minnesota farmers, though if she wins, she is unlikely to have much influence on agricultural policy as a freshman.
Simultaneously, Michael Conaway (R-Texas), a major supporter of farm subsidies and the ranking member of the U.S. House Committee on Agriculture, is retiring. Conaway and Peterson have a long history of brokering bipartisan farm policy deals, defending and expanding lucrative sugar programs for Minnesota sugar beet growers and more favorable cotton and wheat subsidies for farmers in the Texas panhandle.
The potential departure of both politicians, who have been steadfast supporters of farm interests, has many agricultural lobbying groups concerned that agricultural subsidy programs may be curtailed or at least moved away from big commodity crops like corn and wheat. Discussions about the 2023 farm bill have begun and could well include substantive changes in agricultural policy.
Traditionally, the Senate has served as an effective backstop to prevent policy changes farmers don’t like, protecting farm interests from shifts in both the House of Representatives and the White House.
In over 25 states, including Florida, New York and more obvious agricultural power houses like Iowa, Kansas and Texas, Senate candidates assiduously seek the farm vote. Regardless of party affiliation, senators from these states have long delivered programs sought by influential lobbies such as the largely conservative American Farm Bureau, the National Corn Growers Association and the more liberal National Farmers Union.
By comparison, the U.S. House of Representatives is much less farm-oriented. According to the 2017 Agricultural Census only about 45 of the 435 House members have districts with more than 20,000 farm operators. Thus farm lobbies consider the backing of influential and powerful members of the House Committee on Agriculture a high priority, regardless of party affiliation. They view the loss of Conaway and Peterson as a serious concern.
New leadership in the House Agricultural Committee, perhaps coupled with a new Biden administration, could shift agricultural subsidies toward smaller farm operations and climate-change-oriented conservation programs and away from subsidies for major commodities such corn, wheat and sugar.
Several of those commodities are widely accepted as exceptionally harmful for the environment. Corn production is associated with rapid soil depletion and toxic chemical runoff into rivers serving as urban water sources in Midwest states, most prominently in Iowa. Nitrogen runoffs from Florida cane sugar production are damaging the Everglades and Lake Okeechobee.
Over the years, Peterson has steadfastly supported the federal sugar price-support program and subsidies for corn, soybeans and wheat, and has frequently received substantial campaign donations from the American Sugar Alliance and other farm interest groups. His powerful pro-subsidy role on the House agricultural committeehas been useful in his reelection efforts, even in 2016 when the tide turned against Democrats. Today, however, farmers in his Red River Valley district, as in other rural areas, have become wealthier and, like other rural residents, more likely to support Republican approaches to issues such as taxes and regulations.
Still, the outlook for continued farm subsidies for commodities such as corn, cotton and sugar is not entirely bleak. First, the influence of the Senate agricultural lobby remains robust. Second, a long-standing, periodically renegotiated agreement among house members to give farmers subsidies in return for funding nutrition program for low-income households is likely to remain in place. Third, and by no means least, in the broad context of using government programs to obtain political support, farm votes are relatively cheap. In fiscal year 2019, Congress “only” spent about over $30 billion on direct payments to farmers, less than 1% of the $4.34 trillion total spent by the federal government.
It’s a good bet that even a less powerful House agricultural committee chairperson can sustain support for farm programs at close to current spending levels.
But how the money gets spent could look quite different.
Vincent H. Smith is director of agricultural studies at the American Enterprise Institute and professor of economics at Montana State University.
More from Vincent H. Smith: The U.S. spends $4 billion a year subsidizing ‘Stalinist-style’ domestic sugar production