avatar
Most EWG Subsidy ‘Recipients’ Are Too Tiny to Be ‘Farmers’


Part I

Below is a “Map” for navigating around the farm subsidy database to see various rankings.  It is also a summary of the findings reported in Part II.  This is all explained in Part II, below.

Mapof the Farm Subsidy Database  (16 year data)

Most Recipients are Tiny Fractions of Full Sized Farms

EWG Farm Subsidy Database:  TOP RECIPIENTS        10/15/11

                  % mark                    Ranking    Page #   Amount

         Top  0.14%      3,887         194     $2,000,000

         Top  0.65%     18,523         926     $1,000,000

         Top  1%        28,521        1426       $834,694

         Top  2%        57,041        2852       $588,011

         Top 10%       285,206       14260       $140,323

My (corn/soybeans) standard of a minimum-sized full-time family farm: 

        Top  10.1 %          288,293           14414          $138,259

(Small part-time farm:  100 acres of corn + 100 acres of soybeans)

(Use this as a conservative standard of a “full time” farm.)

Other Rankings:

 

               % mark                    Ranking    Page #     Amount

        Top 33%        950,688       47534        $15,170

(2/3 of all “recipients” are 11.0% of “full time” farming or less)

        Top 50%      1,426,032       71301         $4,615

(1/2 of all “recipients” are 3.3% of “full time” farming or less)

        Top 67%      1,901,375       95068         $1,369

(1/3 of all “recipients” are 1.0% of “full time” farming or less)

(Other Possible Standards)

        Top  11.7%     335,043       16752       $112,000

        Top  15.2%     433,161       21658        $75,000

        Top  22.2%     632,648       31632        $37,500

Part IIBelow is an explanation and detailed mathematical analysis of farm subsidy raw data.

Fuzzy Math from the Farm Subsidy Database

The Top 10% are Mostly Family Farm Victims

Farm Subsidy Illusions

Who gets the subsidies in the Farm Subsidy Database managed by the Environmental Working Group?  Let’s do the math, for an Iowa corn & soybean farm.  What do the facts show regarding who really gets the subsidies shown in the farm subsidy database?  

According to EWG, on the “National Data” page, the top 10% got an average annual subsidy of $30,751 while the bottom 80 percent averaged only $587 annually.  (http://farm.ewg.org/region.php?fips=00000&regname=UnitedStatesFarmSubsidySummary)  Over 16 years that’s $492,016 for the average recipient in the top 10% vs $9,392 for the bottom 80%.

Wow!  It really looks like most of the farmers who get subsidies get, on average, a mere 2% of what a bunch of huge farmers at the top get.  It clearly LOOKS as if the top 10% are the big farmers reaping a King’s share of the benefits, while, and the remaining 80% get mere breadcrumbs.

Looks can be deceiving, however, and in fact, the EWG chart presents us with a mere illusion which is nowhere near to the real facts about a key category:  farmers.  This is fairly simple to prove by doing some simple math, so I’ll prove how the picture that most persons get about farm subsidies, the picture most often presented by progressives and in the mainstream media, is hugely false.

Simple Math Proves my Case.

Ok, here’s some fairly simple math for overall numbers for 1995-2010, to prove my case.  (Numbers can be divided by 16 for yearly averages.)  I’m using a corn and soybean example, from my region, which is probably the simplest way to present my proof.

Ok, over the 16 years there were $77,123,770,221 in corn subsidies and $24,285,436,253 in soybean subsidies.

http://farm.ewg.org/region.php?fips=00000&regname=UnitedStatesFarmSubsidySummary

During the same time period there were just over one million harvested acres each for corn and soybeans, (1,186,202,000 for corn and 1,138,907,000 for soybeans).

We see then that, in total, corn subsidies averaged $1,049 per acre and soybean subsidies averaged $334 per acre.   

I can use these figures to then compute farm sizes in acres in the farm subsidy database.  Since corn and soybean acreages are almost equal, I’ll use a farm example that is 50% corn and 50% soybeans.  Similar corn and soybean farms are common in Iowa and across the cornbelt.  A farm that grows almost exclusively corn and soybeans is fairly typical for the region these days.

Ok, next we’ll compute figures for a fairly small, part-time farm growing just 100 acres of corn and 100 acres of soybeans each year.  Using the figures from above, that farm would have received $138,259 (corn:  $104,859; soybeans: $33,400,) in farm commodity (and conservation & insurance) subsidies over the 16 years, 1995-2010.  (Note:  these figures are the per-acre figure for each crop x 100 acres.)

Next we can go online to the Farm Subsidy Database (http://farm.ewg.org/) to see where this small, part-time cornbelt farm ranks.  To find this, click on “Natioal Data,” then, under “Commodity Program Top Recipients:” click on “Top Recipents 1995-2010.”  There you see the top 20 recipients.  Scroll down and click on “Next.”   There you see recipients ranked 21 to 40.  

But note the web address:  http://farm.ewg.org/top_recips.php?fips=00000&progcode=totalfarm&page=1.  You can see there at the very end that it says “page=1.”  By changing that number from 1 to other numbers, you can move quickly through the thousands of pages of rankings.  We find then that a farm with subsidies of $138,259, (like our 200 acre corn and soybean farm,) is found by changing the number to “page=14414.”  (Note:  my work here was done on October 15, 2011.  Database numbers change as new data is added.)

Ok, note at the top of each page that there are 2,852,063 subsidy recipients overall.  Our 200 acre farm is ranked at 288,293. As a percentage that puts it at the 10.1% mark.  We see then, that a small, part-time farm of 200 acres almost gets into the top 10% of the supposedly huge farms!  (Actually it takes another 1.5 acres each of corn and soybeans to do that, for a total of 203 acres.)

Ok, how about a full time-family farm of 400 acres?  That gets us $276,518  in subsidies by these calculations (on “page=7849”).  That puts us at the top 5.5% mark.  

Ok, try a bigger family structured farm of 600 acres. That gets us $414,778 (on “page=4838”).  That puts us into the top 3.4%.  

Ok, what do we find at the top 2% mark?  We find subsidies of $588,100, from 850 acres, and a ranking of 57,041 on “page=2852”.  

We see then that most farms in the top 10% are family farms, close to family-sized farms, or smaller than full-time family-sized farms.  They’re not large corporate farms.  They’re not “giant agribusiness,” as many progressives have claimed.

Ok, what about that bottom 80% that got an average total of $9,392 in subsidies over 16 years.  We can plug that average figure from the EWG chart right into our mathematical computations.  Let’s use a conservative standard, and assume that 200 acres is the bare minimum for a full-time farm.  By that standard, the bottom 80% average only 6.8% of being full time farms!  They’re only about 1/15th the size of my bare-minimum full-sized family corn and soybean farm!

This brings us to that “key category” I identified above:  “farmer.”  What EWG, the mainstream media, conservatives and most progressives have done is to confuse subsidy “recipients” with “farmers.”  The bottom 80% of subsidy recipients are not “farmers.”  They’re people who work elsewhere and do a little farming on the side. They’re retired people, including retired farmers who may have been in the database as full-time farmers for some years, but who then dropped out. The’re people with small acreages.

They’re also dead people.  Yes, EWG and others are suggesting, unknowingly, that dead farmers are among those who are being victimized by the full-time family farmers who all seem to be in the top 10% of the farm subsidy database, not in the bottom 80%.  Farmers who worked and received subsidies in 1995 and 1996, for example, who then retired, and who then died, are legitimate recipients to be included, but their 16 year data cannot be validly compared to farmers who worked full-time for all 16 years.

Here are some additional database fractions:

                      16 year Subsidy Amount   % of “Full Time”

50% mark:                  $4,615                    3.3%

Bottom at 33% mark:        $1,369                    1.0% 

We see then that fully half of the recipients farm 3.3% or less of full-time, and for all of the bottom one third of database recipients, it’s only 1.0% or less (of my minimum standard for a 200 acre corn & soybean farm) of full time.

Further Thoughts on Farm Size and Other Aspects of These Numbers

In interpreting my mathematical calculations, we should keep in mind that family-sized farms vary in the number of acres needed based upon the type of farm.  A wheat, etc. farm out in dry parts of the great plains, would need to be bigger to compare in income with my 200 acre corn and soybean farm from the corn belt, because yields would be much lower.

Another point is that my generalized numbers are false in the way that all generalizations are false.  In fact, there is a wide range for per acre subsidy amounts (of corn, for example,) across the cornbelt and other regions.  This is true for a variety of reasons.  In addition, farms with significant amounts of livestock can be full-time family farms at much smaller sizes.  For example, if half of farm income came from livestock, then the corn/soybean portion would only need to be half as large.

Another factor to consider is racism.  In cases where the Crop Acreage Base and Program Payment Yield (“Base” and “Yield” are the 2 varying keys in formulas figuring subsidy amounts,) are less for minority farmers, due to racism, they’ll have smaller amounts of subsidies, but still be full-time farms.

Another important factor is found in the history of the farm bill.  Under corporate pressure for cheap raw materials, price floors (and supply management) were lowered (1953-1995) and eliminated (1996-) over a number of decades.  As a result, income from farm program crops has been reduced drastically. For example, adjusted for inflation, corn subsidies have added up to about $200 billion since they were first started in 1961, (as a partial compensation for the lowering of price floors).  In contrast, prices were reduced by Congress by more than $1.2 trillion (according to another set of simple mathematical calculations).   Overall, subsidies are not part of increases in income from corn, they’re part of huge net decreases.  One result of this is that most farms have gone out of business.  We see some remnants of this in that bottom 80% in the farm subsidy database.

A key result from these policy changes, and a similar political reason for them, is that giant corporate animal factories and feedlots have been subsidized by billions of dollars of cheap feed ingredients, (such as corn and soybeans).  (The “below cost gains” or “implicit subisides” that these CAFOs [and the trillions for various other US and global farm commodity buyers] get are not in the farm subsidy database.)  As a result, CAFOs have taken most of the “value added” income of livestock away from diversified family farmers.  As a result, most farms that had livestock have lost their livestock.  As a result of that, more acres have been needed to achieve the same income levels as farmers received in past years.  This fact is often not well understood.  To people who grew up on farms 30 to 60 years years ago, a 400 acre farm might seem to be capable of generating more than enough income for a family.  It’s repeatedly said that farms are getting much larger.  When income is used as the measure, however, and farms with livestock from times past are compared to farms without livestock today, the whole idea of increases in farm size changes.  By the standard of income, many farms have gotten smaller, even as they got larger in terms of acreages.

Other standards of farm size can be used & I’ve illustrated some above in Part I. For example, a farm that is 51% of full time could be used.  Livestock income could also be assumed to double farm income in a farm size standard.  When other standards of this nature are used, however, the basic conclusion remains the same. The bottom half of recipients are still tiny fractions of these standards for full time farming.

Similar computations could be made for other regions, with other groups of crops on typical minimum “full-time” farms.  I’ve surveyed subsidies in several other regions.  I think my basic argument holds.

Farms not in the Database

It is often noted that fruit and vegetable farms do not usually get any subsidies.  Examined mathematically, however, I find that these fruit and vegetable farms almost always got more income from the marketplace per unit, as measured by their percents of parity, than did the farm “program crops,” (such as corn, wheat, rice, cotton, barley, sorghum grain, oats, and soybeans) that received subsidies.  As a percent of parity, I find that fruit and vegetable crops usually got larger amounts than “program crops got from the market plus from subsidies.  We find, then, that the crops that get the subsidies are the crops that have had their prices lowered the most by Congress.  (Congress lowered and eliminated price floors and set asides, thus lowering prices.  Program crops lack price responsiveness on both supply and demand sides, so without adequate government price floors, prices have usually (for 140 years) been low, and even very low, below costs of production.  We saw the lowest prices in history recently (1998-2005) after price floors and set asides (to reduce oversupply) were eliminated.

Farmers Subsidize You

Clearly, farmers have received absurdly large amounts of money from taxpayers over the years.  On the other hand, farmers have ended up with even much larger reductions in income from farm programs overall, with the true benefits being multitrillion dollar “below cost gains” going to agribusiness buyers who are not in EWG’s Farm Subsidy Database.  As farm prices have been reduced below the “fair trade,” “living wage,” or “parity” levels of the past (1953-1973 & 1974-2012), and even below full costs (every year 1981-2006, except 1996, for a sum of 8 major program crops,) farmers have subsidized consumers far more than taxpayers have subsidized farmers.  These claims can also be easily demonstrated with simple mathematical calculations.

Needed Policies

During the times (1942-1952) when we had living wage price floors, no subsidies were needed and corporations paid fair prices to farmers.  That’s what we need today.  Make corporations pay, not taxpayers.  We need price floors and supply reductions, (as needed,) plus, for occasional price spikes, price ceilings and reserve supplies to protect corporate buyers and consumers.  These are the policies of the Food from Family Farms Act of the National Family Farm Coalition.

For further reading:

How to Lie with Statistics, by Darrell Huff.

“Subsidy Narratives: How Foodies Unknowingly Bash Family Farmers,” by Brad Wilson,” La Vida Locavore, 2/23/12, http://www.lavidalocavore.org/diary/5099/subsidy-narratives-how-foodies-unknowingly-bash-family-farmers.

“Farm Bill Primer,” (“Farm Bill 101”):  http://www.zcomm.org/zspace/bradwilson

http://www.zcomm.org/got-food-subsidies-farmers-have-long-subsidized-your-food-by-brad-wilson

http://www.zcomm.org/farm-bill-facts-commodity-title-a-family-farmers-view-by-brad-wilson

http://www.zcomm.org/wto-africa-group-with-nffc-not-ewg-by-brad-wilson

http://www.nffc.net/Learn/Fact%20Sheets/FFFA2007.pdf

Leave a comment