Who Feeds at Farm Subsidy Trough?
Federal dollars go to marching bands and nonprofit foundations
WHEN you think of federal agricultural subsidies, images of corn farmers in Iowa or Kansas wheat growers probably spring to mind.Skip to next paragraph
Subscribe Today to the Monitor
But those federal dollars also find their way into the budgets of state public schools and universities. Unlike ordinary farmers, these nonprofit entities do not pay income taxes on subsidy receipts.
Consider the Stiles Farm Foundation. This debt-free, 3,100-acre model farm in central Texas has accepted more than $1 million in corn, oats, sorghum, cotton, and wheat subsidies since 1985. Without those payments it would be ''losing equity,'' says a spokesman for Texas A&M University, whose regents are the foundation's trustees.
Yet since it was founded in 1961, the foundation has given $430,000 in scholarships to Texas A&M students. It also bestowed another $250,000 on the financial management chair in agricultural economics.
Taking a closer look
Out of $100 billion in farm subsidies shelled out over the last decade, $50 million went to recipients that the US Department of Agriculture lists as ''public schools.'' Though a tiny fraction of total farm subsidies, these often overlooked payments are likely to come under closer congressional scrutiny next month when the 1995 farm bill comes up for review.
That federal subsidies prop up a foundation benefiting a wealthy university highlights one of the central issues in the farm-policy debate: How much subsidy fat is there left to trim?
The Congressional Budget Office projects that under current law and marketplace trends, agriculture will qualify for $56.3 billion in subsidies over the next seven years. But Congress has already decided that more must be cut.
Farm advocates on the House Agriculture Committee hope to hold the line at $42.9 billion and continue subsidies beyond 2002. ''Our farmers and ranchers feel like they've already given,'' says committee spokeswoman Jackie Cottrell, citing the decline from previous years. But some subsidy opponents would limit payments to $27.3 billion over five years and halt them after that.
The Environmental Working Group, a watchdog group in Washington that obtained a list of farm subsidy recipients, has criticized wealthy city dwellers and USDA employees who pocket agricultural-program dollars. EWG President Ken Cook says finding schools on the list is not an ''outrage.'' But the public ought to know who's getting federal subsidies so it can ask questions.
''Is this going to the people who most need it? Should we tighten up on what it really means to be a farmer?'' Mr. Cook asks. ''Surely there's a more direct way to support education than this.''
''Public school'' recipients, most of which are found south of the Mason-Dixon line or west of the Mississippi, view subsidies as arising naturally from their worthy, legitimate endeavors.
''We very definitely use subsidies when available to offset the cost of research,'' says Dewey Liccioni, who oversees the finances of the Texas Agricultural Experiment Station.