Agribusiness Still Relies on Subsidies - NYT 5/14/01

05-14-2001, 10:48 AM

Here is a glimpse of the irony. Gigantic agribusiness farms are supported by
government subsidy. Because of factors such as high land taxes, artifically
depressed prices, and high land costs -- the small farmer can barely make it,
if
at all. As far as I can see, Srila Prabhupada had one main vision for
establishing self-sufficient farms -- that the Sucis and Srimatis (the educated
and wealthy devotees) should form a board of trustees and provide start-up
costs
and help offset other artificial expenses (such as tax payments to
non-devotees)
to help self-sufficient farms communities develop.

But, our leaders have no such vision. If funds are raised, rather than invest
them in training devotees in the arts of self-sufficiency, they generally
prefer
to build a spiritual disneyland like New Vrndavana and Bombay (and -- is
Mayapur
next?). Then when the devotees who are members of the spiritual disneyland
communities want to break away from ISKCON, they wonder why.

Could it be because they devoted all their resources to building fantastic
physical structures -- and devoted none to building spiritual social structures
and self-sufficient farm communities?

This article proves that the U.S. government is willing to put its money in
place to support its beliefs -- capitalist agribusiness and cow slaughter
industry. Wouldn't it be great if ISKCON could put its resources in place to
support Srila Prabhupada's goals of cow protection and self-sufficient farm
communities?

your servant,

Hare Krsna dasi

May 14, 2001 -- New York Times

FAR FROM DEAD, SUBSIDIES FUEL BIG FARMS

By Elizabeth Becker

ALHART, Tex. — By any measure, Lanny Bezner is a successful family farmer.
His eldest son, John, rides herd over his cattle, spread out on pastureland
from
here to nearby New Mexico. A younger son, Brian, looks after the farm's heavily
irrigated cornfields, with help from the husband of Mr. Bezner's daughter,
Virginia. As a Texas patriarch, Mr. Bezner rigorously sticks to the principle
that economy of scale is the only way to survive in modern farming. The bigger
the farm, the better likelihood of turning a profit, he says.

By buying adjacent fields, he has expanded his cropland from its original 700
acres to more than 8,000. In five years he has doubled his grazing land by
leasing 90,000 acres of pasture. He owns a fleet of tractors and heavy farm
equipment; he fills their tanks with fuel from his own gas pumps. He dries and
stores his harvest in his own imposing grain elevators, which hold more than a
million bushels of corn.

Surveying the farm that he carved out in the Panhandle landscape of dry
mesquite
and sagebrush, Mr. Bezner says the key to his family's prosperity is federal
farm subsidies.

"We're successful primarily because of government help," said Mr. Bezner, 59,
an
entomologist who grew up on a farm outside Amarillo.

Although Mr. Bezner hesitated to discuss the size of those subsidies (and
refused to divulge how much he makes without federal help, or what his expenses
are), government documents show that in the last four years of the 1990's, he
received $1.38 million in direct federal payments.

Most remarkably, Mr. Bezner and the other big farmers here in Hartley County
and
across the country received those record-breaking payments in an era when farm
subsidies were slated for extinction.

Under the Freedom to Farm Act of 1996, swept up in the language of the
Republican revolution under Speaker Newt Gingrich, farmers who planted row
crops
— corn, wheat, soybeans, rice or cotton — were freed from government production
controls. In exchange for being able to plant what they wanted, they were told,
they would have their subsidies gradually phased out.

While farmers embraced their new freedom to decide what to plant, they balked
at
accepting the rigors of the free market. When prices for their crops held
stagnant and their costs rose, farmers lobbied Congress for "emergency"
payments.

Their friends in Congress relented. Instead of diminishing, the subsidies have
nearly tripled with steep emergency payments that reached $22 billion last
year,
according to Keith Collins, the top economist at the Agriculture Department.

Supporters of farm subsidies, which were enacted in the Depression, argue that
they are needed to save the family farm. But government documents indicate that
the prime beneficiaries hardly fit the image of small, hardscrabble farmers.
Because eligibility is based on acreage planted with subsidized crops in the
past, the farmers who have the biggest spreads benefit the most, according to
the Environmental Working Group, a nonprofit advocacy organization that
obtained
government records of farm subsidies through the Freedom of Information Act.

"The data shows that government subsidies are tilting the playing field in
favor
of the largest farms," said Clark Williams-Derry, the senior analyst at the
Environmental Working Group who created a national database of subsidies.

Mr. Bezner, who saw his direct federal payments balloon from $164,621 in 1996
to
$741,839 in 1999, is one of the elite 10 percent of American farmers who
receive
61 percent of the billions of dollars the program distributes. The subsidies
have been a chief source of capital for large operators to expand their
holdings, often by buying out their smaller neighbors.

And unlike other federal entitlement programs, farm subsidies have no
requirements of income, assets or debts.

FRIENDS IN HIGH PLACES

As Congress considers reauthorizing the Freedom to Farm Act, lawmakers have
already made one fundamental decision: they will keep the subsidies. The
phaseouts are a thing of the past.

The cost, and the fact that the money goes mostly to a select few, will be at
the crux of the debate over how to reshape subsidies.

"The cost of this program is astonishing," Mr. Collins said. "Any person
engaged
in small business in America would be amazed looking at this. Their jaws would
drop at the money farmers receive."

Mr. Bezner makes no apologies for accepting the money. To his mind, government
subsidies help the American consumer by making sure grocery stores are stocked
with inexpensive food.

"That government money is keeping cheap cereal on the shelves in New York
City,"
he said.

And no one expects farmers to lose their subsidies — not with the friends they
have in Congress.

The top leaders of both parties represent farm states that rely on subsidies.
In
the Senate, the majority leader is from Mississippi and the minority leader
from
South Dakota. In the House, the speaker is from Illinois and the minority
leader
from Missouri. The relevant committees are headed by representatives from farm
states; the chairman of the House Agriculture Committee is Representative Larry
Combest, a Republican who represents Mr. Bezner's district in the northern
plains of Texas.

"Look at the Nasdaq: those companies are going out of business and we don't
open
up the Treasury to them," Mr. Collins said. "But Congress chose not to let
farmers bear that kind of pain."

Like their counterparts in Hartley County, large farmers around the country
have
complained to Congress that Freedom to Farm is not working because their crops
are selling at the same low prices their grandfathers' crops fetched 40 years
ago.

When lawmakers passed the act in 1996, they approved generous subsidies for the
first two years in order to give farmers a cushion to prepare for their
independence. But when the world market pushed prices down, farmers asked for
emergency payments.

In 1998, Congress approved additional money, adding 50 percent to the core
subsidy payments. In 1999 and 2000, the lawmakers doubled the core payments.
This month, with the strong backing of the White House, Congress added $5.5
billion to next year's budget blueprint to cover potential emergencies.

The concentration of payments will remain the same: the wheat-growing plains
states from the Texas Panhandle through North Dakota; the Corn Belt across the
Midwest; and the rice and cotton states of the Mississippi Valley from Missouri
through Louisiana.

While there are other subsidy programs, like those for dairy farmers and sugar
producers, the row-crop payments are by far the biggest. Ranchers, and farmers
who produce fruits and vegetables, receive virtually nothing from this program.

Representative Combest said he had concluded that the subsidy system should
remain intact. His one minor proposal is to cut subsidies when farmers receive
higher prices for their crops — what he calls a "countercyclical" approach.

WHO BENEFITS?

Even though President Bush has promised to eliminate what he calls corporate
welfare, Mr. Combest and some Republican leaders see no contradiction between
the farm payments and Republican free-market orthodoxy. They contend that the
subsidy is meant to help the consumer, not the farmer.

"The consuming public has been the beneficiary of this program that gives money
to farmers to produce low-price commodities," Mr. Combest said in an interview.
"We don't want to become as dependent on foreign food as foreign oil."

Those emotional appeals fall flat with his counterpart, Senator Richard G.
Lugar, the Republican from Indiana who is chairman of the Senate Agriculture
Committee.

"Let's not make a mistake that these subsidies are pro-consumer; they are
pro-producer," Senator Lugar said in an interview. "There would be
extraordinarily adequate supplies of food in America if you had no control and
no subsidies."

Senator Lugar said he wanted a revised farm policy to provide more money to
conserve land, improve rural communities and help farmers who are not doing
well.

He also said he was under no illusion about the effect of the
multibillion-dollar payments.

"The rhetoric of failing farms doesn't always match the reality, because large
commercial farmers are doing well with their subsidies; their land values have
gone up and so have land rents," Mr. Lugar said.

Eight percent of the country's farms produce 72 percent of the country's
harvest. Most of the rest of the two million American farmers earn their
incomes
from jobs off the land.

Instead, Senator Lugar said, these crop subsidies are a direct transfer of
taxpayers' money to rural landowners. "Is the American public willing to spend
money each year and every year providing a transfer payment from the taxpayers
to the agricultural sector?" he asked. "And how much — 5 billion, 10 billion,
15
billion?"

What no lawmaker is expected to do is ask farmers to prove they need the
subsidies.

"This is not meant to be a welfare program, and it won't be — not if I have
anything to do with it," Representative Combest said.

Agriculture economists say such an argument misses the point.

"In our food stamp program we means-test the working poor with strict
requirements, but we ask nothing of farmers," said Mr. Collins, the Agriculture
Department economist, who called the subsidies "an income supplement from the
government."

WHERE THE MONEY GOES

Even in Mr. Combest's Congressional district, where federal subsidies make up
more than one-third of the total farm income, Hartley County holds a special
place. The top 10 percent of the county's subsidy recipients were paid an
average $396,131 from 1996 to 1999 — more than double the national average.

And in the pecking order, Lanny Bezner ranks third. Two other Hartley County
farmers received more money: John Cover, whose subsidies totaled $2.3 million
over that period, and Carl Kupyer, who received $1.9 million.

With subsidies of that size, those families rank among the top 10 recipients in
Texas and the top 100 in the country.

Yet the Kupyer family considers the subsidies barely large enough to keep it in
business, according to J. C. Kupyer, who works with his father, Carl.

"We do make a living as farmers," J. C. Kupyer said. "But actually it would be
hard to farm without subsidies."

For three generations the Kupyers have been adding to their property, building
their farm from less than 700 acres to a 16,000-acre spread that they now own
free and clear. Yet with spiraling energy costs, Mr. Kupyer said, the family
would sell the farm if someone offered to buy it.

Mr. Cover refused to discuss his subsidies.

Andy Michael, the Hartley County commissioner and a rancher, said he discounted
many complaints from big farmers like Mr. Kupyer. In his view, farmers complain
to cover up how much money they are receiving from the government.

"The farmers are very closemouthed about getting help from the government —
they
never, never talk about it," Mr. Michael said. "Farmers work the system.
There's
no system for us to work."

In the last five years, he said, the classic divide between farmers and
ranchers, exploited in generations of cowboy movies, has gotten worse, because
farmers are receiving bigger subsidy checks while ranchers get nothing.

"Any time I'm around farmers they say farming doesn't pay, but then they go out
and buy those $150,000 tractors with their government checks," Mr. Michael
said.
"When times are tough for us, the rancher just tightens his belt."

Business is good for Mr. Michael and many other farmers and ranchers in
Dalhart,
a town of more than 7,000 people midway between Dallas and Denver. Local farm
equipment dealers report that despite the downturn in crop prices, their sales
of tractors and other equipment are among the best in the country.

At the John Deere dealership, farmers have spent $13 million to $21 million on
agricultural equipment every year since Freedom to Farm was enacted. "This is
one of Deere's strongest markets," said Mark Miller, finance manager at the
Dalhart dealership.

Ralph Link is a Hartley County farmer who cannot afford new tractors. He works
his 845-acre spread himself with used equipment and received $173,787 in
subsidies the first four years of Freedom to Farm.

But unlike his neighbors with larger farms, Mr. Link has nothing but praise for
the prosperity that comes with federal checks. With his new freedom, Mr. Link
has been able to take advantage of the region's shift toward agribusiness and
plant all his cropland in corn, selling it to one of the huge cattle feedlots.

In bad times, he says, the checks provide a safety net. In good times, like the
current season, the subsidies will provide him with a good profit — this
season,
he says, it will be 18 percent.

"The government payments are bigger since Freedom to Farm, so I don't
understand
why you wouldn't like it," Mr. Link said. "Things couldn't be better."