PRESIDENT OBAMA promised in February to "end direct payments to large agribusinesses that don't need them." Ever since, farm-belt politicians and lobbyists have been trying to crop-dust him into backing off - a sad testament to the power of farming interests over basic budget sense.
Opposition to the plan managed to unite a fractious political world. Representative Frank Lucas of Oklahoma, the ranking Republican on the House Agriculture Committee, said Obama's proposal "attacks family-run farms all across rural America." House Agriculture Committee chairman Collin Peterson, a Democrat from Minnesota, said the proposal was so "stupid," it was "more than dead on arrival." American Farm Bureau Federation president Bob Stallman said ending subsidies "would have drastic impacts at the farm level."
But what is the "farm level," exactly? Agricultural lobbyists like to pretend that they are protecting small farmers from financial ruin. While some families continue to eke out a modest living from the land, American farming is now an industrial-scale business. According to a December report by the US Department of Agriculture, the 8 percent of farms with sales of $250,000 or more make up a whopping 76 percent of all sales.
Federal direct payments disproportionately help large corporate farmers. While 40 percent of farms with sales under $250,000 received direct payments in 2006, 65 percent of farms with sales over $1 million received subsidies. In other words, the money goes to the farms that need it least.
Obama's proposal is quite modest, and has nothing to do with small farms. Rather, he wants to end direct subsidies to farms with an income of more than $500,000 a year. The administration also wants to reduce bloated crop insurance subsidies - another form of welfare for big corporate farms. But as the agribusiness lobby mobilizes, the administration hasn't put enough emphasis on its own proposals.
The continuation of the status quo has massive implications, from driving out small farmers precisely when Americans are demanding healthy local produce, to mindless production of processed foods fueling the nation's obesity epidemic. Indeed, Obama would use potential savings from cutting farm subsidies to promote better nutrition in school lunches and other federal food assistance programs.
Obama should stick to his proposal and not be cowed. Skillful lobbyists have played on Americans' empathy for family farmers while defending policies that primarily help corporate farms. The industry is reaping entitlements that need to end.