Washington senators slam USDA over unequal farm payments in bailout

By:  Thomas Clouse
Source: The Spokesman-Review

Both U.S. senators from Washington signed an analysis by congressional staffers that shows the Trump administration’s $16 billion bailout of U.S. farmers has mostly benefited those growers in the South and large companies over small operations.

Sens. Maria Cantwell and Patty Murray joined 15 other Democratic senators in critiquing how the U.S. Department of Agriculture and Agriculture Secretary Sonny Perdue have doled out billions in aid through the Market Facilitation Program.

The report released Tuesday concluded that Georgia, Mississippi, Alabama, Tennessee and Arkansas have received the highest payments per acre under the program. The analysis also shows that farmers in the Midwest and northern Plains have been hurt the most by trade wars.

“The President boasted about his trade wars today, but lots of Washington farmers have not been protected from these tariffs or have been blocked from delivering their crops,” Cantwell said in a prepared statement. “Secretary Perdue and President Trump need to stop the speech-making and deliver the support to farmers they have promised.”

After President Donald Trump sparked a trade war with China and other countries, retaliatory tariffs were immediately put in place on agriculture commodities grown in the U.S. In response, Trump pushed through the Market Facilitation Program to reimburse farmers for those losses.

The programset aside $12 billion in 2018 and authorized another $16 billion in 2019. The agency has paid farmers nearly $6.7 billion so far this year in the first installments. The states collecting the most so far – more than 60% of the total funds – are Iowa, Illinois, Minnesota, Texas and Kansas.

The analysis released Tuesday also asserted that the Department of Agriculture has done nothing to target the assistance to vulnerable small, medium and beginning farmers. Instead, it said the agency doubled the payment limits, directing even more money to large, wealthy farming partnerships.

“Our growers and exporters are a critical part of the economy in communities across Eastern Washington and our state, and this uneven approach to federal trade assistance unfairly picks winners and losers in industries that are already being squeezed by President Trump’s decisions,” Murray said. “Farmers from Spokane Valley to Walla Walla to Ritzville and beyond should have access to the federal support they need to weather the impacts of these unpredictable trade disputes – and that’s what I’m going to keep pushing for.”

Sen. Debbie Stabenow, of Michigan, the top Democrat on the Senate Agriculture Committee, said the program lacks any plan for rebuilding or replacing the markets that farmers have lost since they became caught up in the trade war last year. She leveled the charges in a letter to Perdue that accompanied the 12-page report.

“This Administration’s chaotic trade agenda has irreparably harmed farmers, on top of the market instability and extreme weather challenges they already face,” Stabenow wrote.

In response, the USDA issued a statement saying the payments are based on trade damage and not on where the farms are located or their size.

“While we appreciate feedback on this program, the fact of the matter is that USDA has provided necessary funding to help farmers who have been impacted by unjustified retaliatory tariffs,” the statement said. “While criticism is easy to come up with, we welcome constructive feedback from any member of Congress with recommendations as to how the program could be better administered.”

The formula for payments gives a premium to those counties, like many in the Midwest, that have multiple crops such as corn and soybeans. It gives less money to those counties, like many in Eastern Washington, that grow only wheat, said Michelle Hennings, executive director of the Washington Association of Wheat Growers.

“We are appreciative that the administration has recognized problems with trade and thank them for trying to compensate farmers,” Hennings said. “But the question of whether the calculation is fair can be a concern. We obviously noticed that the Pacific Northwest is a lot lower than a lot of the U.S. When you pay $15 or $20 an acre here and pay $50 an acre in the Midwest, you have to explain that” to farmers.

And the formula also means that farmers in the Evergreen State can get less per acre than their neighbors across the county border, she said.

“The farmers come in and ask, ‘What’s the difference?’ ” Hennings said. “You have to explain it to them. But for our dryland wheat farmers, we took a big hit. We felt the Pacific Northwest payments could have been higher.”

The 2018 and 2019 versions of the farm payments used very different formulas for allocating aid. The program originally was based on a farm’s production of certain crops. About 83% of the money went to soybean producers because they had suffered the most from China’s retaliatory tariffs.

For 2019, farmers get fixed per-acre payments based on their county, varying from $15 to $150 per acre, based on how much the USDA calculated that each county had been hurt. Counties qualifying for the highest per-acre payments are concentrated in the South, the report noted. And the payment caps were doubled, from $125,000 to $250,000.

Roger Johnson, president of the National Farmers Union, said the report highlights “gross disparities” from region to region. He noted that producers in Western and Northern soybean country, who typically shipped their crops to the Pacific Northwest for export to China, suddenly took a big price hit because they had nowhere to send their beans. Yet, he said, it shows the money flowed disproportionately to Southern farmers.

The USDA could have designed the program better if it had consulted with Congress, Johnson said, because the agriculture committees have experience in minimizing regional and other inequities.

Brooke Appleton, vice president of public policy at the National Corn Growers Association, said the Democratic senators’ report, along with Peterson’s letter, “raised important issues regarding the impact on Northern state corn farmers who have faced additional hurdles due to limited export opportunities in the Pacific Northwest.”

While Hennings said local growers appreciated the administration at least trying to help farmers, she called the payments a “Band-Aid.”

“Farmers want trade, not aid,” she said. “We’d prefer not to be in this position. We get targeted when we start getting aid from the government. We would rather go about it by having good trade relations.”

The Associated Press contributed to this report.