NCPA - National Center for Policy Analysis

Farm Subsidies Went To Rich Farmers In Iowa

January 14, 2000

Wealthy agribusiness partnerships and corporations reaped about half of the $2 billion in federal farm subsidies channeled into Iowa in the first three years of the Freedom to Farm program. The other half was parceled out in smaller payments of usually less than $6,000 to small, family farmers, according to a study by the Environmental Working Group.

  • Of the payments made between 1996 and 1998, half went to just 12 percent of farm operators.
  • More than 29,000 of Iowa's farmers, or 21 percent, received less than $1,000 in annual payments.
  • About 4,000 farmers received payments of $100 a year or less.
  • Although the Freedom to Farm law was supposed to wean farmers from most traditional subsidies during a seven-year transition to free-market agriculture, the state's three-year total of $2 billion was $243 million more than was received the previous three years.

Reports point out, however, that the study doesn't fully capture the government's generosity toward Iowa. Payments under Freedom to Farm totaled $929 million in 1998. But adding in special aid to hog raisers, disaster payments, crop insurance indemnities and conservation payments brings Iowa's total take to $1.54 billion for 1998.

Experts expect that 1999 figures will be even higher.

Source: Bruce Ingersoll, "Iowa Farm Aid Helped Rich Most, Study Says," Wall Street Journal, January 14, 2000.

 

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